California Billionaire Tom Steyer Criticizes APS Rate Hikes

By Steve Goldstein
Published: Tuesday, May 14, 2019 - 12:27pm
Updated: Tuesday, May 14, 2019 - 2:43pm
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Kaely Monahan/KJZZ
Ryan Randazzo in KJZZ's studio in 2018.

STEVE GOLDSTEIN: California billionaire and activist Tom Steyer is once again criticizing Arizona Public Service. Last time around it was the clean energy ballot measure Prop 127, the renewable energy standards initiative. Now, Steyer is joining local activists in calling for a 2017 rate hike to be reversed by Arizona regulators. Arizona Republic reporter Ryan Randazzo wrote about this issue and joins us now. Ryan, good morning.


GOLDSTEIN: So, Tom Steyer is once again getting involved. What is his goal here? And are there risks, considering how Prop 127 went?

RANDAZZO: Yeah, well let's start with what he's trying to do. He was involved in that ballot initiative last year that failed, as you mentioned. But right now he's come back to the state. He's advertising to — you know — spending his own money, to advocate that a 2017 rate hike at APS gets reversed. And the regulators, the Arizona Corporation Commission, is actually scheduled to vote on that next week. So he's sort of jumping in at the 11th hour to put pressure on those five regulators to reopen that case and repeal that rate hike that affected, you know, more than 1 million customers.

GOLDSTEIN: So, what is Steyer and his group saying about why he's getting involved in this again because he had such a bad showing frankly the last time around he got involved.

RANDAZZO: Well, he's saying that since the ballot measure failed, what has come to light is a APS has revealed that they were behind the spending in 2014 that put two Republicans on the Corporation Commission. Tom Forese and Doug Little, those two did vote for this rate hike, and he's saying that that is corruption. Now what APS did there was not illegal,  but he says that it is improper that a utility company should be able to secretly fund the elections of the people who then set the utility companies rates. This is something we've discussed for the last five years here in Arizona. He is really frustrated by that, and he says that the rate hike is improper because those people were basically put in office by the company.

GOLDSTEIN: Well, it almost seems as though ... that people are — even those who would agree with Steyer — there are still some who come with the phrase "California billionaire." We can't have him getting involved in that. How much does this take away from the issue if at all, if possible?

RANDAZZO: Well, that's a great question, because the person who started this complaint, you know, APS raised its rates. We wrote about that. People were concerned that their bills were going up more than what was advertised by the company, and a local woman named Stacey Champion launched a petition, started crowdfunding for her attorneys fees and filed a complaint that has gotten all the way to a vote before the commission. There's been expert testimony. APS has had to hire its own experts to try and refute the stuff they found out. We learned a ton of things about APS's rates she's been working tirelessly on this, and she doesn't really want Tom Steyer's help. You know.

GOLDSTEIN: She has actually said that?

RANDAZZO: Oh, yeah. I mean, she's been doing this on her own ... and when she started this campaign said she was not going to take any corporate money at all. So she did crowd crowdfund for her attorney's fees, but she wouldn't take money, say, from the solar industry — which has long been at odds with APS because she didn't want to bias this complaint. She says it's a bipartisan complaint. APS has Republicans and Democrats as customers and they're all paying too much, according to Stacey Champion. And, so, she's been working on this case, and then, you know, the week before this comes to a vote, you have a Democrat fundraiser-billionaire-activist-Californian — and she doesn't think that's helpful. And, frankly, she doesn't doesn't want that assistance.

GOLDSTEIN: Well, I don't want to use my own analogy, but it almost makes me think of Save Our Schools, which was such a grassroots effort. And what if someone from California or some other out-of-state person said, "You know what, I'm happy to come in. I'll visit your state and give you millions of dollars. Wait, wait, wait. You're taking away from the actual initial message." Does Stacey think that could affect how things are actually seen in reality?

RANDAZZO: Well, her words were: "It could could hurt more than help." And, you know, there are five commissioners who are going to sit down and vote on this. Four of them are Republicans one's a Democrat. Arizona Republicans are not likely, in my opinion, to be swayed by Tom Steyer's opinion on something.

GOLDSTEIN: That is very good political analysis, I think, on your part. So, where do the commissioners stand right now in terms of the rate hike. The fact that they're taking up — do you have a side of an indication to yourself? Let's say if we could even do pre- and post-Steyer. Let's say Steyer was not involved. How seriously the commissioners taking it based on the setup there is now — still only one Democrat.

RANDAZZO: Yeah, I think they're taking it incredibly seriously. The one Democrat has already openly said that she wants this rate hike reversed. She campaigned on that, as a matter of fact last year, and she got more votes than anybody else in that election. The other person who has, in the past favor that, is Robert Burns. He got more votes than anybody else in the prior election. So, I don't know where those two are going to vote next week when it comes down to this. But if they don't vote to repeal the rate hike, the judge in the matter, she recommended dismissing the case but not without consequence to APS. She wants APS to return $5 million to customers. She wants APS to describe its rate hikes more accurately in the future — rather than saying, "It's an average $6 a month. Oh, some people might see a $20." She wants a much more descriptive analysis given to customers, so that they know what to expect in future rate cases. So, I think the commissioners are going to really work around the edges on that and definitely, I think, they're lined up to probably make a APS. cough up that $5 million. I think they're going to make APS  make some changes going forward. There's a longshot they could repeal this rate hike. But even if they don't next week, they're continuing their own inquiry into whether or not APS is earning too much money. So, even if Stacey champions case does get dismissed next week, as the judge recommended, the commissioners themselves have really taken this upon them upon themselves to look harder at how much money APS  is earning off of its Arizona customers.

GOLDSTEIN: I suppose it doesn't matter, but perception becoming reality to a lot of people, is there pressure on the commissioners to act in a certain way? Not that they wouldn't take it seriously, but the fact that there is, of course, the revelation you mentioned the millions that APS actually did spend. I know there's these commissioners who were involved in that are in the past at this point, but is there a feeling that the commissioners need to act to to make sure that they're showing a true independent streak?

RANDAZZO: I think there's real political pressure on the corporation commissioners. Again, Tom Forese was on the commission when this rate hike passed. So was Doug Little. Doug Little took a job in D.C. and left. Tom for got smoked last year in the election. ... And largely because of this APSissue that was in front of him. He had to campaign after having voted for an APS rate hike that was widely disliked, all the other Republicans in that race basically said that they were interested in looking hard at APS's earnings and this rate hike. So, that's where the public sentiment lies, and I think that those people who have to win re-election realize that.

GOLDSTEIN: In about 20 seconds, Ryan. Does this indicate we're going to see a lot more of Tom Steyer in Arizona — maybe even in 2020?

RANDAZZO: Tom told me yesterday he's still trying to decide. I said, "Are you doing this just to set up for another ballot initiative? Are you going to come back here?" And he said, "We're still trying to figure that out." He realizes that he also got smoked last year with his Prop 127 clean energy initiative. It wasn't even close. But he says Arizona is a very important state ... for clean energy and also just for the presidential election could be a swing state. So, he wants to be active here. His other big political goal is to impeach President Trump. So, if he fails in that he at least wants to see someone else elected in 2020. So, he really wants to participate here, he wants to influence Arizona. But this may be what it tells him whether or not that's gonna be effective.

GOLDSTEIN: He's clearly not afraid of dunk tanks, we know that. Ryan Randazzo, the Republic. Thanks.

RANDAZZO: Thank you.

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