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SB1508 - 572R - I Ver
REFERENCE TITLE:
utilities; annual disclosure requirements; commission
State of Arizona
Senate
Fifty-seventh Legislature
Second Regular Session
2026
SB 1508
Introduced by
Senators
Kuby: Diaz, Miranda, Ortiz, Sundareshan;� Representative Garcia
AN
ACT
Amending title 40, chapter 2, article 1,
arizona revised statutes, by adding section 40-207; relating to public service
corporations.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 40, chapter 2, article 1,
Arizona Revised Statutes, is amended by adding section 40-207, to read:
START_STATUTE
40-207.
Utilities; annual disclosures to the commission; civil penalty;
definitions
A. On or before May 1, 2027 and each
year thereafter, a utility shall report to the commission for the previous
calendar year:
1. An itemized list of all of the
following expenses:
(
a
) Membership
dues, sponsorships or other contributions to an industry trade association,
group or related entity that is incorporated under 26 united states code
section 501, including any portion of the membership dues, sponsorships or
other contributions that support political activities or advertising.� This
subdivision does not apply to fees for professional licenses that are related
to an employee's job function.
(
b
) Charitable
giving, including contributions to an organization that is qualified under 26
united states code section 501(
c
)(3) or 501(
c
)(4).
(
c
) Political
influence activities.
(
d
) Institutional
advertising.
(
e
) Promotional
advertising.
(
f
) Payments
made to outside attorneys who represent the utility in a proceeding before the
commission, including fees paid to experts that testified on behalf of the
utility.
(
g
) Contributions
to political candidates, political parties, CAMPAIGN committees, issue
committees or independent EXPENDITURE committees, including political
organizations as prescribed in 26 united states code section 527 or other
related political expenses.
(
h
) Costs,
including marketing, administration or customer service costs, that are
associated with products or services that are not regulated by the commission.
(
i
) PENALTIES
or fines that are imposed on a utility, including tax PENALTIES or fines.�
(
j
) liability
insurance costs and travel, lodging, food and beverage expenses for the
utility's or an affiliate of the utility's board of directors and officers.
(
k
) costs that
are associated with an aircraft that is owned, leased or chartered by the
utility's or an affiliate of the utility's board of directors and officers.
(
l
) Investor
relations costs.
(
m
) Litigation
costs regarding existing or proposed federal, state or local regulations,
legislation, ordinances or commission decisions.
2. For
each covered business unit, an itemized list of all of the following:
(
a
) The name and job title of each employee.
(
b
) A job description of each listed employee that is
sufficient to describe the employee's responsibilities.
(
c
) The total
annual compensation that is provided to each listed employee.
(
d
) The number
of hours that are booked to an above-the-line account for each
listed employee.
(
e
) The
percentage of total annual compensation that is booked to an above-the-line
account for each employee.
B. To the extent the UTILITY retains
outside vendors to perform activities prescribed in subsection a of this
section, the utility shall provide to the commission an itemized list of all
expenses that are paid to the vendors.� The utility shall provide the federal
energy regulatory commission's uniform system of accounts number under which
each expense is logged and recorded and shall include documentation that
identifies the time expended, the work performed and the total cost incurred.�
Itemized lists shall include for each expense the billing amount, the billing
date, the identity of payee and an explanation of the expense sufficient to
describe its purpose.� The utility shall include a separate line item for each
payment that is associated with an ACTIVITY described in subsection a of this
section.
C. For each commission proceeding in
which the utility is a party, the utility shall provide to the commission an
itemized list of expenses booked to an above-the-line account for participation
in that proceeding, including employee compensation, vendor expenses and other
expenses.� The utility shall provide the Federal energy regulatory commission's
uniform system of accounts number under which each expense is recorded.
D. The commission shall make all
reports that are filed with the commission publicly available.
E. A utility shall clearly and
conspicuously disclose in all of its public messages whether the costs of the
public messages are being paid for by the utility's shareholders or ratepayers,
consistent with advertising and FUNDRAISING DISCLOSURE STATEMENT REQUIREMENTS
PURSUANT TO SECTION 16-925. a DISCLOSURE IS NOT CLEAR AND CONSPICUOUS IF THE
DISCLOSURE IS DIFFICULT TO HEAR OR READ OR IF THE PLACEMENT OF THE DISCLOSURE
IS EASILY OVERLOOKED.
F. fOR PUBLIC MESSAGES that are
RECORDED TO AN ABOVE-THE-LINE ACCOUNT, THE UTILITY SHALL IDENTIFY, IN RESPONSE
TO A REQUEST FROM A PARTY IN THE UTILITY'S MOST RECENT GENERAL RATE CASE, which
EXPENSE OR CAPITAL ACCOUNT IS THE SOURCE OF THE FUNDING.
G. tHE COMMISSION SHALL MONITOR AND
INVESTIGATE COMPLIANCE WITH THIS SECTION.
H. tHE COMMISSION SHALL ASSESS A
CIVIL PENALTY of not more than $1,000 AGAINST A UTILITY THAT FAILS TO comply
WITH the reporting requirements of this section.
I. For
the purposes of this section:
1. "above-the-line
account":
(
a
) Means an account that contains EXPENSES that a utility
recovers from ratepayers.
(
b
) includes an
account that contains expenses that the utility used to calculate a revenue
requirement request in a general rate case.
2. "affiliate of the
Utility" means an entity that is related to the utility as a subsidiary,
parent or sibling corporation, including by shareholding or other means of
control.
3. "Compensation":
(
a
) Means an
employee's annual salary.
(
b
) Includes a
bonus, benefits or other consideration of any value.
4. "Covered business unit"
means a division, department or other organizational employee group within a
utility that performs any of the activities prescribed in subsection a of this
section.
5. "Expense" MEANS a
payment to an external entity, a cost incurred by a parent company or corporate
affiliate and invoiced to a utility and compensation paid to an employee of a
utility.
6. "Institutional
advertising":
(
a
) means
written, online, video or audio COMMUNICATIONS that primarily build the public
image of a utility.
(
b
) Does not
include public messages that:
(
i
) the utility
is directed to publish by a federal or state agency.
(
ii
) Provide
information on safety measures, emergency conditions, energy conservation
programs, rates, utility programs and services that are approved by the
commission or on service interruptions and that do not primarily build the
public image of the utility.
(
iii
) Provide
necessary information to customers about specific actions customers may take
for their safety.
(
iv
) Are
required by the commission.
7. "Investor relations"
means any ACTIVITY, communication, service or expense for the purpose of
promoting, supporting or managing the utility's relationship with current or
potential investors, shareholders, securities analysts, investment ADVISORS or
financial media or for the purpose of marketing to enhance the utility's stock
price, market perception or investment appeal.
8. "political influence
activity":
(
a
) means An
activity that directly or indirectly influences any of the following:
(
i
) The
adoption, repeal or modification of federal, state, regional or local
legislation, rules or ordinances.
(
ii
) The
election, recall, appointment or removal of a public official or the adoption
of initiatives or referenda.
(
iii
) The
approval, modification or revocation of franchises of a utility.
(
iv
) Public
opinion WITH respect to LEGISLATION, rules, ordinances, elections, referenda or
rate setting of a utility.
(
v
) Decisions
of federal, state, regional or local public officials.
(
b
) Includes
Research, preparation or any other activity undertaken FOR the purpose of
supporting any activities prescribed in subdivision (
a
)
of this paragraph.
(
c
) Does not
include any of the following:
(
i
) An ACTIVITY
that is directly and necessarily related to appearances before regulatory or
other governmental bodies in connection with the utility's existing or proposed
operations of the utility's regulated system, except that Policies AFFECTING
the use of gaseous FUELS or ELECTRICITY are not directly and necessarily
related to the utility's existing or proposed operations.
(
ii
) An
activity that is directly related to a energy EFFICIENCY program approved by
the commission or another public purpose program approved by the commission if
the participation of the utility has not otherwise been prohibited by the
commission.
(
iii
) An
activity that responds to a written request by a legislative committee, the
commission or a government agency in this state for technical information from
the utility.
(
iv
) An
activity that is required by applicable federal or state law or by order of a
regulatory authority and that is undertaken to satisfy that law or regulation.
9. "Promotional
advertising":
(
a
) Means
written, online, video or audio COMMUNICATIONS for the purpose of inducing a
person to patronize a product, service, business or industry.
(
b
) Does not
include public messages that:
(
i
) the utility
is directed to publish by a federal or state agency.
(
ii
) Provide
information on safety measures, emergency conditions, energy conservation
programs, rates, utility programs and services that are approved by the
commission or on service interruptions and that do not primarily build the
public image of the utility.
(
iii
) Provide
necessary information to customers about specific actions customers may take
for their safety.
(
iv
) Are
required by the commission.
10. "Public official"
means:
(
a
) a
decision-maker within an administrative agency or legislative body of this
state or of the federal government.
(
b
) an
executive officer of this state or of the federal government.
11. "utility" means:
(
a
) an
electrical public service corporation or gas public service corporation that is
regulated by the commission.
(
b
) an
agricultural improvement district that is organized pursuant to title 48,
chapter 17.
12. "Vendor" means a person
or business that provides goods and services.
END_STATUTE