After more than two weeks of a hearing before the Arizona Corporation Commission on Johnson Utilities, two things are clear:
First, based on testimony, including that of Johnson family members, it would be highly suspicious if the commission didn’t appoint an interim manager for the Pinal County utility.
And Pinal County Supervisor Todd House has no business being a public servant.
In the 10 days of riveting, and sometime bizarre, testimony before the commission, we have seen just how haphazard and careless the operation of the San Tan Valley utility actually is. Staff writer Jake Kincaid’s reporting has been like unwrapping a rotten onion. Just when you think one layer can’t be any more spoiled, Jake unwrapped another layer through his detailed coverage of the proceedings.
The biggest eye-opening detail is that the operations of a company that has taken in millions of dollars from northern Pinal County residents are even a mystery to the family that owns it.
The hearings have revealed that the utility diverts half of its revenue — $15 million a year — to a subsidiary company called Ultra Management.
In testimony before the commission, neither Johnson Utilities owner George Johnson, nor his son, Chris, could say what that company does or why it exists.
Chris Johnson couldn’t even tell the commission how much money he makes as the owner of the subsidiary company.
Town of Queen Creek Finance Director Scott McCarty testified that the utility was not investing properly in its infrastructure.
“If payments to Ultra were being made in a lower amount, there would be enough money to address infrastructure problems.” McCarty said. “Not only have they not been investing, but the money is not with Johnson Utilities.”
And that’s the financial end of the company. On the operational side of the business, there have been hundreds of complaints from customers of lousy service, overcharging and plain rude behavior.
Last week George Johnson said all the complaints were just from a vocal minority.
“A group of people down there ganged up on me about six years ago,” Johnson said. “They are still going at it.”
He blamed Republican Pinal County Supervisor Mike Goodman, who represents San Tan Valley, for riling people up.
“You got people like Mike Goodman stepping outside of his shoes as a supervisor; he’s been an instigator out there.”
An independent observer, such as myself, would say Goodman was representing the best interest of his constituents. That is what an elected official is supposed to do. If anyone has stepped outside of his shoes, it is Supervisor House.
House’s district is the Apache Junction area. None of his constituents pay bills to Johnson Utilities. But that didn’t stop him from giving his input on the matter and supporting his longtime friend and campaign donor George Johnson.
“There is a history of people being upset with Johnson Utilities, but I believe that it’s confined to a small group of people,” House said, implying he knows more about the people of Goodman’s district than Goodman does. “A lot of the issues that were brought up that night (during hearings in San Tan Valley) were past issues that had been corrected.”
Then after being told that the utility is the second worst in the state for sewage overflows, he said he never heard any complaints about that.
“I would not know if those problems exist. They have not been brought to me by citizens, so I would not be in the loop on that,” House said. “I rely on citizens to bring problems to me. ... I am saying they are doing a satisfactory job of trying to rectify those problems.”
That’s because it is not House’s district, so residents would complain to Goodman.
I guess that detail escaped House.
The reason private utilities are regulated by state agencies like the Corporation Commission is because they are monopolies. Customers have no choice whom they get their water from, or who takes their sewage. They can’t shop around for a better service.
This is why the commission exists. And when a company like Johnson Utilities is performing in such an incompetent, and some might say despicable and unethical, manner, then it should have its exclusive rights to the monopoly removed.
The testimony from the ownership alone is enough to justify an interim manager being appointed while a transfer of ownership is sought. It is clear that the best option is for Johnson Utilities to become a public utility. And the testimony shows that the town of Queen Creek would probably be the best operator.
House is known for his diaper drive every year. He even brought it up in his testimony. Maybe that is something he should stick to.
Andy Howell is assistant managing editor. He can be reached at firstname.lastname@example.org.