AG Brnovich files petition to oust ACC chairman

Posted at 5:03 PM, Nov 30, 2015
and last updated 2015-11-30 19:03:36-05
A member of the Arizona Corporation Commission should be removed from office because she is a registered lobbyist for cable companies regulated by the panel, the state attorney general said Monday.
A petition for special action was filed with the state Supreme Court seeking the removal of Susan Bitter Smith because of the alleged conflict of interest.
Her job as executive director and designated lobbyist of the Southwest Cable Communications Association, and as a registered lobbyist for Cox Communications, are clear violations, Attorney General Mark Brnovich said.
He said he made the move to protect the commission's integrity and to restore voters' faith in the electoral system. He and Bitter Smith are both Republicans. Bitter Smith was elected to the post in 2012.
"This isn't something that we do willy-nilly, that we're doing for whatever reason -- we are doing this because we feel like we have to, that she clearly violated the law," Brnovich said.
Bitter Smith said in a statement issued by her lawyer, Ed Novak, that she had never been employed, paid or lobbied for a regulated utility. She said Brnovich's interpretation of the conflict of interest law is so broad that almost everyone could be excluded from serving as a commissioner and she looks forward to the state Supreme Court review.

"The complaint was provided to the AG by a democrat who is connected with a potential democratic candidate for the commission," said Bitter Smith through her attorney.

The action came nearly three months after a Chandler attorney filed a complaint with Brnovich's office against Bitter Smith seeking her removal for violating state conflict-of-interest laws that govern corporation commissioners.
Brnovich cited a state law that says a person employed by or having an official relation to a regulated entity cannot hold office as a commissioner.
Bitter Smith says she works for non-regulated cable companies, not for telephone companies that are regulated by the commission.
Brnovich said there's no difference in ownership involving cable companies and telephone companies.
"Those cable companies that pay the dues, pay the fees to the SWCCA do indeed all of them offer bundling services, they offer phone services," he said. "She does indeed serve as a lobbyist not only for those cable companies, but those companies have direct affiliates that are controlled by those parent companies."
Bitter Smith was interviewed by Assistant Attorney General Beau Roysden and acknowledged being paid $150,000 a year for serving as executive director of the cable association.
The state Supreme Court could decide the case just on the filings, send it to a lower court for hearings, or ask for a response from Bitter Smith and hold oral arguments before issuing a decision, Roysden said.
There is precedent for removing a sitting commissioner for violating the law cited by Brnovich. In 1999, the state Supreme Court removed commissioner Tony West because he held a securities license at the time of his election.
The five-member commission regulates electricity providers, water companies and other firms that hold monopoly power in the state, including setting rates. It also oversees securities regulation, railroad and pipeline safety and facilitates business incorporation. It has executive, judicial and legislative power over the firms it regulates.
The action targeting Bitter Smith is the latest development in a series of issues that has embroiled the commission in controversy. Allegations that Commissioner Bob Stump exchanged text messages with executives with utility Arizona Public Service Co. during the 2014 election campaign are part of another attorney general's probe.
APS is widely suspected of spending millions to support two Republicans running for the commission last year.
The attorney general also is looking into former commissioner Gary Pierce. A whistleblower alleges he met multiple times privately with top APS officials while the commission was considering a rate increase.

A Corporation Commission spokesperson said nothing will change for the board pending the ruling. Brnovich said he wants this case to move swiftly, to limit the issues Bitter Smith can vote on.