For Immediate Release | 10-15-20
Media Contact | Nicole Capone
Direct | 602-542-0713
E-Mail | NCapone@azcc.gov
Phoenix - The Arizona Corporation Commission held its monthly Open Meeting to discuss and vote on various securities, safety and utilities agenda items. Here is a brief recap of the meeting highlights:
Commission Finds Mesa Businessman Defrauded Investors with Unregistered Real Estate Investment
The Corporation Commission ordered Richard A. Smart of Mesa and his affiliated companies to pay $45,000 in restitution and a $15,000 administrative penalty for committing securities fraud in connection with a real estate investment.
The Corporation Commission found that Mr. Smart was the managing member of three companies: Smart Acquisitions, LLC, Smart Enterprises, LLC and Simply Smart Homes, LLC. However, Mr. Smart and his companies were not registered to sell securities in Arizona.
The Commission found that Mr. Smart and Smart Acquisitions, LLC were raising investment capital to “fix and flip” residential property in Tucson, Arizona.
This is the second time the Corporation Commission has taken legal action against Mr. Smart and his affiliated companies. In 2017, respondents Smart and Simply Smart Homes, LLC were ordered to pay restitution and penalties for fraudulently offering and
selling unregistered securities involving real estate investments.
The Corporation Commission found that despite its previous administrative order, Smart and Smart Acquisitions induced two Arizona residents to collectively invest in the fix and flip investment property in Tucson. The Commission found Mr. Smart and
Smart Acquisitions, LLC misused a significant portion of the investor funds on personal expenses not related to the investment. Additionally, the Commission found that the respondents failed to tell the two investors about the Commission’s prior
order and that there were at least six judgments entered against Mr. Smart in the state of Utah for unpaid state income tax liens.
All documents relating to this agenda item can be found in the Corporation Commission's online docket at https://edock t.azcc.gov and entering docket number S-21113A-20-0233.
Commission Revokes Securities Salesman License of Surprise Man
The Corporation Commission revoked the securities salesman license of Adrian Ortega of Surprise, Arizona based upon a Financial Industry Regulatory Authority (FINRA) bar from associating with any FINRA member in any capacity. Ortega pled guilty to identity
theft and forgery in Maricopa County Superior Court, which ordered Mr. Ortega to a term of supervised probation and to pay $20,185 in restitution.
All documents relating to this agenda item can be found in the Corporation Commission's online docket at https://edock t.azcc.gov and entering docket number S-21114A-20-0244.
Union Pacific Railroad Rio Salado Parkway Bridge Update
At the October Open Meeting, Commissioners heard updates regarding the Union Pacific Railroad Rio Salado Bridge reconstruction in the City of Tempe. On July 29, 2020, a Union Pacific Railroad (Union Pacific) train derailed resulting in a fire and a portion
of the railroad bridge over Rio Salado Parkway to collapse. On August 4, 2020, Union Pacific filed a request to reconstruct which was approved by the Corporation Commission on August 12, 2020.
Union Pacific related that following the Commission’s approval, the Rio Salado Railroad Bridge was once again operational on August 12, 2020, following the final long span section of the bridge being replaced. This allowed Union Pacific to resume
train operations through the Phoenix metro area, which has returned to normal levels following a backlog that resulted from the temporary closure and reconstruction of the bridge. On August 24, 2020, roadway construction began and was completed on
September 4, 2020, allowing roadway and pedestrian traffic to resume prior to Labor Day Weekend.
While train, roadway, and pedestrian traffic has resumed, there are several outstanding issues that have not yet been resolved including chemical leakage into Tempe Town Lake and landscaping issues among others. Union Pacific and the City of Tempe indicated
they are working together closely to resolve all outstanding issues and will continue to update the Commission of their progress moving forward.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number RR-03639A-20-0242.
Johnson Utilities, Update from Interim Manager
During an update from Johnson Utilities, LLC, the company’s Interim Manager, EPCOR, informed the Arizona Corporation Commission that the company’s water systems performed
well despite it being one of the hottest Arizona summers in recorded history, with no major supply or pressure issues and no issues with water quality.
EPCOR continues to make improvements to the wastewater plants and collection systems including planned maintenance. While there have been limited sanitary sewer overflows, those have been small and mainly due to the result of third-party contractors hitting
facilities. EPCOR will work with contractors to further reduce the frequency of these incidents.
Major capital projects remain on hold for the time being due to a lack of funding. Customer satisfaction remains above 80%.
Finally, EPCOR continues to monitor developments involving the COVID-19 pandemic to ensure safety measures are taken to protect both employees and customers.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov/and entering docket number WS-02987A-18-0050.
Southwest Gas Corporation to Add Additional Public Comment Sessions Regarding Rate Increase Application
The Corporation Commission directed Hearing Division Staff to hold at least two additional public comment sessions regarding Southwest Gas Corporation’s (SWG) rate increase application, which was filed in 2019.
Commissioner Sandra D. Kennedy filed a letter requesting additional public comment sessions be held to accommodate a greater portion of SWG’s customers who might not have been available during previously scheduled public comment sessions. Commissioner
Kennedy requested that the additional sessions be held in the evening and on a Saturday and that they be at least two and a half hours in duration.
Spanish language interpreters will be available at the public comment sessions. Notice to SWG customers will be sent out via bill inserts and posted on the SWG website. The Corporation Commission’s Hearing Division will be working with SWG to determine
the exact dates of the future public comment sessions. That information, once finalized, will be noticed by the Commission and posted on the Commission website.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number G-01551A-19-0055.
A complete broadcast of the Commissioner’s October 13-14, 2020 Open Meeting is available on the Corporation Commission’s website: http://azcc.gov/live.
The Arizona Corporation Commission was established by the state’s constitution to regulate public utilities and business incorporation. The Corporation Commission is Arizona’s co-equal, fourth branch of government. 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