PHOENIX — The Arizona Corporation Commission discussed last week whether it was time to seek a contempt of court ruling against Johnson Utilities, possibly resulting in “incarceration” of managers.
“I would feel very comfortable in directing that we do an enforcement with sanctions or perhaps even incarceration by a direct violation,” Commissioner Boyd Dunn said at the Feb. 4 meeting. The commission will hear a recommendation from its staff on Feb. 20.
EPCOR is the interim operator of Johnson Utilities by a court order issued in 2018. The issue is alleged “interference” with EPCOR by Johnson Utilities or Hunt Management, a related company whose employees do work for Johnson Utilities. EPCOR most recently complained an employee was unavailable to shut off a water main on Jan. 28.
“This caused the repair work to be delayed and prolonged and added additional costs to the project,” Jeff Stuck, EPCOR’s vice president of Arizona operations, said in a Jan. 31 memo to the ACC. Stuck continued that another Johnson employee has been “routinely” assigned to work on other Johnson properties “instead of working on utility issues. This has been an ongoing issue.”
Johnson Utilities provides water and wastewater service to San Tan Valley, part of Queen Creek and Anthem at Merrill Ranch in Florence.
Johnson attorney Jeffrey Crockett responded to the ACC that the issue was more of a miscommunication; the Jan. 28 repair wasn’t scheduled with Johnson Utilities or on the company’s “scheduling board.” Crockett told the commission his own investigation found no delay on Jan. 28 as others were able to do the work. He said employees are where they need to be 99% or 100% of the time.
But some commissioners sounded as if their patience for a solution was wearing thin, in a video of the meeting on the ACC website. “I feel like it’s ‘Groundhog Day’ to hear this problem again, Dunn said.
Commissioner Sandra Kennedy said, “This problem is not going to go away until we address it.”
EPCOR attorney Jason Gellman wrote to the commission on Jan. 31 that EPCOR has noted previous instances when owners of Johnson Utilities or Hunt “have interfered with EPCOR’s ability to perform under its interim manager agreement … EPCOR requests that the Commission take appropriate action to prevent further instances of interference.”
Elijah Abinah, utilities division director for the ACC, asked the commission to give staff a chance to work out a solution among EPCOR and the Johnson entities.
But Robin Mitchell, chief counsel for the ACC, questioned the wisdom of involving owners of the company.
“We already have an order in place to tell them what to do. Once you involve ownership, the process gets mired down. They then assume they have a bunch of veto power over what we propose. We just want to get the work done. It’s starting to become counterproductive,” Mitchell said.
Crockett asked the ACC for “a hearing on the facts” around the alleged issues of interference.
Burns said that without an operator who can respond to issues quickly, “we’re going to have a health and safety problem.”