Phoenix, Ariz. —   The Arizona Corporation Commission voted on 19 matters, including securities, railroad, telecommunications, electricity and water utility items, in addition to one policy statement.  All items were unanimously approved, 5-0.  Highlights from the meeting include:

Securities

Dan E. Droeg et al

• TMTE, Inc. a/k/a Metals.com et al

Utilities

• Salt River Project Agricultural Improvement and Power District
• Global Water – Ocotillo Water Company, Inc.

 Railroad

• Union Pacific Railroad Company

Dan E. Droeg et al (S-21269-A-23-0247) - The Arizona Corporation Commission ordered respondent Dan E. Droeg of Mesa to pay $1,105,187 in restitution and a $150,000 administrative penalty after he defrauded a securities client by spending the client’s money for his personal benefit. The Commission also revoked Mr. Droeg’s investment adviser representative license and salesman registration due to this conduct.   The Commission found Mr. Droeg lied to his employer about being a client’s nephew so he could be named trustee of this client’s charitable remainder trust. This misrepresentation gave Mr. Droeg account access in order to surrender an annuity and liquidate other investments.

TMTE, Inc. aka Metals.com – The Commission authorized the Securities Division to represent the Arizona Corporation Commission in a global settlement in conjunction with the federal government and 29 other states against TMTE, Inc., also known as Metals.com. The parties successfully negotiated the settlement, agreeing that Metals.com engaged in a fraudulent scheme targeting senior citizens, in which 32 Arizona investors were defrauded, their losses totaling about $5.9 million.  Metals.com convinced the victims to liquidate their retirement assets and purchase gold and silver bullion from the Company. The case was filed in the United States District Court of the Northern District of Texas Case No. 3:20-CV-2910.  The consent order will recover funds for fraud victims.  The District Court will determine the amount of restitution and civil monetary penalties in a future proposed agreement or at a future hearing.

Salt River Project Agricultural Improvement and Power District (L-00000B-24-0223-00239)– The Arizona Corporation Commission approved a Certificate of Environmental Compatibility for the South Mountain Transmission Project. The project will support the rapid growth and development along Loop 202 in the Laveen area and strengthen the overall transmission system reliability.  The City of Phoenix is planning for future development in Laveen, which could include a mix of land uses that include retail locations, hospitals, hotels and resorts, residential areas, new businesses and an industrial and technology park. 

Global Water – Ocotillo Water Company, Inc. (W-21307A-24-0107) -  The Commission approved Global’s application for a Certificate of Convenience and Necessity to provide water service to seven existing developments in unincorporated Pima County: Diamond Bell Ranch, Rancho Del Sol Lindo, Sierrita Foothills Estates, Silverbell, Thunderhead Ranch, Valley View Acres, and Vistas Las Catalinas.  These seven areas total approximately 4,783 acres and 2,200 water customers.  These customers had been serviced by Tucson Water, the City of Tucson’s municipal water provider.  Upon closing, Global will acquire Tucson Water’s water system assets that serve the seven areas pursuant to an Asset Purchase Agreement.  Because Tucson Water is not regulated by the Commission, the application addresses only the CC&N necessary to serve the customers.  On April 25, 2024, the City of Tucson passed Resolution No. 23746 - which states that the City of Tucson staff determined that it would be financially and operationally beneficial to sell the systems due to the annual maintenance needs, operational risk, future liability, and capital investment requirements in comparison to the revenue generated. 

Commissioner Lea Marquez Peterson, who is also a Pima County resident and Tucson Water customer, said she acknowledges that many Tucson Water customers opposed the acquisitions by Global, and added, “Global will be charging the current Tucson Water rates, and the City of Tucson’s determination to sell its water system assets falls outside of the Commission’s jurisdiction.”

Chair Thompson also commented, “It’s not that we don’t care about the public’s frustration, but the only thing this Commission can do is evaluate whether the purchaser is a viable option, and I believe Global is a viable option.  I commend Global for keeping in place the current Tucson Water rates.”

Union Pacific Railroad Company (RR-03639A-22-0287) – The Commission approved Union Pacific’s proposed amended deadlines and updated design plans for the Ellsworth Road at-grade crossing, which is part of the Pecos Industrial Rail and Train Extension (PIRATE) Line.  Union Pacific states the 18-month construction deadline is being delayed by federal approval processes and requested the construction deadline be extended by two years, from June 12, 2025, to June 12, 2027.  The Surface Transportation Board (STB) is investigating and assessing damage to archeological sites that were discovered at the newly excavated basin, and has determined that ancestral remains and habitation features from descendant tribal communities are present at the construction site.   Union Pacific also requested approval to provide for a six-lane at-grade crossing at Ellsworth Road, original design plans called for a four-lane at-grade crossing.