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Phoenix, Ariz. — The Arizona Corporation Commission voted on 24 matters, including securities, water, and electric items. Highlights from the meeting include:
Securities
Utilities
ACC
John A. Perez (S-21267A-23-0242) - The ACC ordered respondent John A. Perez of Scottsdale to pay $ 174,087 in restitution and a $71,000 administrative penalty for fraudulently engaging in unlicensed advisory services to defraud investors. The Commission found Mr. Perez solicited investors to attend training sessions, misrepresenting himself as an experienced and wealthy investment adviser to at least eight investors, but failed to disclose his two prior criminal convictions for property theft. While Mr. Perea was never licensed as an investment adviser or registered as a securities salesman in Arizona, he guaranteed quick and substantial gains from trading securities in his big “carpool” investment account. The pooled investment accounts showed little to no activity.
TRS PureFlex, LLC et al. (S-21208A-22-0254) - The ACC found former securities salesman Robert Steven Swagger of Scottsdale, along with two limited liability companies—TRS Pureflix, LLC and TRS Companies, LLC, committed securities fraud. Mr. Swagger, TRS Pureflix, LLC, and TRS Companies are jointly and severally ordered to pay $202,000 in restitution and a $25,000 administrative penalty, while his wife, Terri Lynne Swagger, as a controlling person of TRS Pureflix, LLC, is ordered to pay $10,000 in restitution for the company’s securities fraud violations. The Commission found Mr. Swagger solicited investors through the Young Presidents Organization Christian Fellowship Network by posting the investment pool offering on its discussion board and by emailing members. However, Mr. Swagger failed to tell investors that he spent investor funds on personal expenses instead of investing the money into a streaming company for faith and family-friendly media projects. Mr. Swagger is awaiting sentencing before the United States District Court for the District of Arizona after pleading guilty to federal wire fraud charges related to his conduct promoting the investment pool offering.
Ronald Eugene Krause et al. (S-21354A-25-0100) – The ACC sanctioned insurance producer Ronald Eugene Krause of Tucson and his affiliated company, Senior Forethought, LLC, for offering an unregistered investment while not registered as securities salesman or dealer. Mr. Krause is ordered to pay a $500 administrative penalty to the state of Arizona. The Commission found that Mr. Krause placed an online and print advertisement seeking Christian investors for a “low risk” investment, offering a “high yield” return of 83 percent within one year. Mr. Krause told potential investors each investment of $35,000 or more would fund his mail-based insurance company that would sell policies to ensure the coverage of funeral costs and other final expenses after the insured’s death. Ultimately, Mr. Krause did not make any known sales from his investment promotion activity.
Arizona Public Service Company (L-00000D-22-0030-00198) – The Commission approved a Certificate of Environmental Compatibility to interconnect a new 230-kV Switchyard, known as the Raptor Switchyard, to the West Valley Central Line that will exclusively serve a new data center customer. In response to Commissioner questions, APS confirms that all infrastructure costs associated with this project will be paid upfront by the data center customer, and no costs for the Raptor Switchyard will be passed on to any other customers. The project’s purpose is to provide electricity service ONLY to the data center customer.
"I support the economic opportunities that data centers bring," said Commissioner Rachel Walden. "However, we must ensure that all costs are paid for by that customer, and not other rate payers, which was achieved in the West Valley Central Transmission Project."
Harquahala Complex HoldCo, LLC (L-21304A-25-0169-00248) – The Commission approved a Certificate of Environmental Compatibility for the Harquahala North Transmission Line Project, which is intended to interconnect the associated Industrial Campus and Generating Facilities to the bulk electric transmission system, improve operational flexibility and reliability for the facilities connected to the Delaney substation southwest of Tonopah. The campus is comprised of a 3,000 MW solar and battery storage facility, and a 450 MW natural gas generating facility will be constructed on the campus in the future.
El Rio Sol Transmission, LLC (L-21328A-25-0186-00249) – The Commission approved a certificate of environmental compatibility for the RioSol to Saguaro Interconnection Project, which includes two new 500-kV transmission lines from the RioSol transmission line to a new 500kV Rancho Saguaro Switchyard. The original Rio Sol project is a 550-mile, high voltage transmission line that will provide energy for communities in bother Arizona and New Mexico, with a planned in-service date of December 2028. The project was met with opposition from more than a dozen residents of Red Rock Village in Pinal County, located east of the I-10 and east of the project. Several residents in the Missile Base neighborhood filed comments in the docket expressing opposition to the project. One consumer claimed the current project is not new, but an addition to the original RioSol transmission line and should not be treated as a separate project. The Office of General Counsel investigated the claims, finding no evidence to support that claim.
Bensch Ranch Utilities, LLC, Pine Meadows Utilities, LLC and Verde Santa Fe Wastewater Company, Inc. (SW-04026A-24-0275, SW-03962A-24-0276, and SW-03437A-24-0277) –The Commission approved consolidation and a Settlement Agreement in these cases, which collectively serve about 1,100 customers in the Dewey, Payson, and Cottonwood communities. The Companies are all owned by JW Water Holdings, LLC, which also owns 15 other water and wastewater utilities in Arizona. The companies propose to consolidate into a single entity by absorbing Bensch Ranch and Pine Meadows into VSF, which will then be known as VSF Consolidated. The parties and the Commission have produced a Settlement Agreement resolving all disputed issues in the case. The consolidation and Settlement Agreement is expected to reduce monthly bills for most ratepayers, the following table shows potential rate impacts for typical residential customers:
| System | Current Bill | Consolidated Statement Rates |
| Bensch Ranch | $79.80 | $55.25 |
| Pine Meadows | 71.74 | 55.25 |
| VSF | 43.24 | 55.25 |
Empirita Water Company, L.L.C. (W-03948A-25-0130 and W-03948A-25-0131) – Empirita Water Company serves about 80 customers eight miles west of the City of Benson in parts of Cochise County and Pima County. The current rates were set in 2012. Empirita proposed a rate design that includes a monthly minimum charge that increases by meter size. The recommended order and opinion adopted three customer tiers. The expected rate impact would result in a rate increase. The typical residential bill for a 5/8 x 3/4-inch meter, with a median usage of 4,173 gallons, will go from $42.78 to $84.82 per month. With the rate case expense surcharge of $3.61, the typical residential bill for a 5/8 x 3/4-inch meter, with median usage of 4,173 gallons, would rise to $88.43, a total increase from current rates of $45.65 or 106.71%.
Commissioner René Lopez commented, “This month’s Decisions demonstrate that consolidation, in combination with cost-effective ratemaking, will contribute to the stability, safety, and reliability of water and wastewater services in our rural Arizona communities.”
Arizona Corporation Commission (E-00000A-25-0235) - The Arizona Corporation Commission voted unanimously to move forward with a document-less intervention related to a US Department of Energy letter to the Federal Energy Regulatory Commission (FERC). The letter asserts jurisdiction over the interconnection of large loads, particularly data centers. The doc-less intervention allows the Commission to show interest in the issue without filing a letter or comments into the FERC docket.
“FERC has traditionally not asserted authority over matters involving load interconnection, and so as this process unfolds, it’s important for the Commission to represent Arizona’s voice and preserve our authority over large loads connecting to our grid. We share the goals of serving large industry and promoting growth in a manner that does not impact reliability or come at the financial expense of residential and small business ratepayers,” said Chair Kevin Thompson.
“I believe it is critical that FERC work closely with the States and state regulators to ensure rules resulting from this proposal affirm state authority and do not inadvertently create challenges to resource adequacy, reliability, and affordability,” said Vice Chair Nick Myers.
"This is such a hot controversial issue across the nation. It's important that Arizona has a voice in this conversation,” said Commissioner Lea Márquez Peterson.
In late October, the U.S. Secretary of Energy sent a letter to FERC, indicating an advanced notice of proposed rulemaking on the interconnection of large loads to the interstate transmission system. "Large loads, including AI data centers, served by public utilities must be able to connect to the transmission system in a timely, orderly, and non-discriminatory manner. This is an urgent issue that requires prompt attention," Energy Secretary Chris Wright wrote, "it is my view that the interconnection of large loads directly to the interstate transmission system to access the transmission system and the electricity transmitted over it falls squarely within the (Federal) Commission's jurisdiction."
