Billionaire spending money to ‘educate’ public on APS influence
PHOENIX -- Having burned through $28 million in a pair of losing political battles in Arizona last year, California billionaire Tom Steyer is now prepared to pump some more cash into the state.
But unlike last year, it’s not to affect the outcome of elections, at least not directly.
Instead, it’s designed to “educate’’ voters about what NextGen America, Steyer’s political action committee, believes is the outsize influence that Arizona Public Service has on state politics. And that, according to organization spokeswoman Aleigha Cavalier, should ultimately affect how people vote in future elections.
Cavalier would not specifically disclose how much Steyer intends to spend.
The billionaire hedge fund manager funneled $22.8 million last year into Proposition 127. That measure would have required investor-owned utilities like APS and Tucson Electric Power to generate at least half of their power from renewable sources by 2030.
It was rejected by a margin of 2-1 after Pinnacle West Capital Corp. spent more than $32 million of its own cash against the proposal.
Steyer had no better luck with his bid to oust state Attorney General Mark Brnovich.
That came after Brnovich’s office altered the description of the measure that appears on the ballot, adding wording that Steyer and Prop 127 proponents said was specifically designed to help APS. The change was so radical that Eric Spencer, who at the time was state elections director, called it “eyebrow raising.’’
Steyer then spent $3.9 million in attack ads on Brnovich. But the Republican incumbent still outpolled Democrat January Contreras by about 90,000 votes out of more than 1.3 million ballots cast.
This time, however, Cavalier said the money is going to be focused not on specific ballot measures or political campaigns but on educating voters on how APS is using money from ratepayers to exercise its own influence.
“We want to make sure that we’re continuing that work to make sure that people know the level of corruption that goes on in Arizona because of APS,’’ she said.
APS spokeswoman Suzanne Trevino derided the effort.
“It seems very hypocritical that a person who doesn’t even live in our state ... is accusing a company that has done business for more than a century in Arizona of having undue influence when we are working to craft responsible energy policy,’’ she said. And Trevino said that whatever money Steyer is spending now is “positioning for the 2020 election.’’
A key focal point of the Steyer-financed campaign is going to be the rate hike for APS approved by the Arizona Corporation Commission last year by a 4-1 margin.
That increase was supposed to boost the average bill of consumers by about $6 a month and generate an extra $95 million for the utility. But commissioners have been taking a second look amid complaints by many customers that their rates have gone up much faster.
And then there’s the question of whether the utility is actually bringing in more than the permitted increase.
APS reported earlier this month that its profits in the first three months of this year were $17.9 million, compared with $3.2 million at the same time last year. APS officials said the difference was a combination of an unusually cold winter and lower operating costs.
That led to figures of income of $500 million.
Cavalier contends that the commission vote is a direct result of the utility putting commissioners of its choosing in place.
That specifically includes the recent disclosure that Pinnacle West gave $10.7 million to organizations that spent heavily on the 2014 Corporation Commission race to secure the election of favored utility regulators.
It did openly admit to spending $4.2 million on commission races in 2016; there were no reports of Pinnacle West spending this past election.
“I think the money was spent to elect their own regulators,’’ Cavalier said. So one point behind the messages will be to urge APS customers to call commissioners to rescind the rate hike.
Cavalier acknowledged that the $95 million figure was the result of a deal among various intervenors in the case, including the Residential Utility Consumer Office. But she said they signed off on that deal because they did not believe they could get a better deal out of the commission.
A spokesman for APS previously has said that any spending on races and lobbyists comes not from ratepayer dollars but from the profits of the parent company.
That, however, ignores the fact that APS -- and the money it gets from customers -- is pretty much the sole source of income for Pinnacle West.
What Steyer hopes to achieve in Arizona is only part of his broad political agenda.
Steyer has been behind a push on members of Congress to impeach President Trump. While his Need to Impeach campaign has gained some attention among some elements of the Democratic Party after the release of the Mueller report, party leadership has been talking the issue down.
More recently, Steyer announced that he is launching a campaign to disbar Attorney General William Barr. That follows allegations that he lied to Congress about the Mueller report.
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