For Immediate Release | 2-6-19      
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Arizona Corporation Commission February Open Meeting Highlights Day 2

PHOENIX — The Arizona Corporation Commission today held the second and final day of its monthly Open Meeting to discuss and vote on various utilities, securities, and safety items. Below is a brief recap of the meeting:

Commissioners Approve Amendments to Contributions and Advances in Aid of Construction

Commissioners voted to approve amendments to a previous decision related to the tax treatments of Contributions and Advances in Aid of Construction (CIAC/AIAC). Commissioners originally addressed the methods of funding the income tax liabilities that accompany the receipt of CIAC and AIAC at last year's November Open Meeting, but there were amendments that Commissioners felt needed more time to be worked on.

Commissioner Justin Olson's amendment prohibits a water or wastewater utility from requiring a developer to gross-up a contribution for tax expense if the utility is not expected to have any tax liability. Commissioner Olson's amendment relates to water and wastewater utilities that are otherwise eligible to gross up CIAC and AIAC.

All documents related to this agenda item can be found in the Corporation Commission's online docket at and entering docket number AU-00000A-17-0379.

TEP Energy Efficiency Improvement Plan

Commissioners voted to approve Tucson Electric Power Company's (TEP) application for approval of Its 2018 Energy Efficiency Implementation Plan and Request for Waiver, as recommended by staff.

In its plan, the Tucson utility company proposed two new programs: Residential Load Management Pilot program, and Commercial Community Development Pilot Program. Corporation Commission staff recommended approval of the Residential Load Management Pilot Program. Staff recommended disapproval of the Commercial Load Management Pilot Program saying it consisted of revitalization of vacant facilities and reinvestment of energy savings in economic development and found that the revitalization component would increase energy usage rather than decrease it.

All documents related to this agenda item, including the components of the TEP energy efficiency plan, can be found in the Corporation Commission's online docket at and entering docket number E-01933A-17-0250.

APS Request for Rate Adjustment Through a Lost Fixed Cost Recovery Mechanism

Commissioners voted to approve Arizona Public Service Company's (APS) annual application for lost fixed cost recovery adjustment.

This lost fixed cost recovery mechanism was originally approved in Corporation Commission Decision 73183 in May 2012 and provides for the recovery of lost fixed costs associated with energy efficiency savings and distributed generation. The lost fixed cost recovery is a rate mechanism intended to assist in the recovery of a previously authorized revenue requirement. The adjustment charge recovers fixed costs of providing services that are not recovered due to mandated energy efficiency and renewable resource requirements.

APS is requesting a new lost fixed cost recovery rate be changed from $0.772 to $0.838 per kilowatt (kW) per month for customers on a demand rate and from $0.00301 to $0.00288 per kilowatt-hour (kWh) per month for customers on an energy-only rate. APS calculated the change would result in an average bill increase of $0.40 per month (.26 percent) for residential customers on a demand rate using an average of 1,140 kWh and 6.1kW per month, and an average bill decrease of $0.14 per month (-0.09 percent) for customers on an energy-only rate with an average use of 1,140 kWh. The overall average bill impact to all customers would be a decrease of $0.02 per month (-0.01 percent).

All documents related to this agenda item can be found in the Corporation Commission's online docket at and entering docket number E-01345A-16-0123.

Commission Sanctions Multiple Individuals and Companies, including two Lake Havasu CPAs and their company that committed a $2.6 Million Fraud

The Corporation Commission ordered Lake Havasu CPAs Lance Michael Bersch and the late David John Wanzek and their affiliated company, ER Financial & Advisory Services, LLC, to pay $2.6 million in restitution and a total of $816,000 in administrative penalties for fraudulently selling unregistered securities and registration violations. Also, the Corporation Commission ordered Concordia Financing Company, Ltd. of California to jointly pay $2.6 million restitution and a $700,000 administrative penalty for its securities registration violations. The Corporation Commission found that Bersch and Wanzek fraudulently sold unregistered investment contracts in Concordia, which was in the business of purchasing and servicing subprime loans to truck drivers who purchased used, big rig trucks. The Corporation Commission found that Bersch, Wanzek and ER Financial were not registered to sell securities in Arizona, and they failed to disclose to several investors the finders' fees Concordia paid them for selling the investments. The Corporation Commission found Concordia did nothing to determine if an investor had the financial wherewithal to make an investment, and it failed to use questionnaires or other materials to determine whether investors were accredited investors. For more details on this case, view the full text of the Corporation Commission's order S-20906A-14-0063.

A complete list of agenda items and archived broadcast of the Commissioner's February Open Meeting is available on the Corporation Commission's website:
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The Arizona Corporation Commission was established by the state's constitution to regulate public utilities and business incorporation. The five Commissioners elected to the Corporation Commission oversee executive, legislative, and judicial proceedings on behalf of Arizonans when it comes to their water, electricity, telephone, and natural gas resources as well as the regulation of securities, pipeline, and railroad safety. To learn more about the Arizona Corporation Commission and its Commissioners, visit