When we asked the community if they thought the CC&N (Certificate of Convenience and Necessity) should be revoked from Johnson Utilities (JU), we learned that many people don't understand what the CC&N does and what happens if the CC&N is revoked.
So we spent some time with representatives from the Arizona Corporation Commission who explained the purpose of the CC&N and how revoking it would impact current customers.
Revoking the CC&N:
- does not remove Johnson Utilities from the area
- does not allow another entity to kick Johnson Utilities out and step in, taking over the company or its assets
- still requires Johnson Utilities to provide service to its existing customers
- the Arizona Corporation Commission still regulates Johnson Utilities
So what changes?
Revoking the CC&N from Johnson Utilities allows another entity to "come in" to the existing territory and "drop their own lines" to provide a competing service, in addition to the service that Johnson Utilities is providing. It does not remove Johnson Utilities from the area. Keep in mind that just because competition would be allowed, does not mean another company would be interested. Another entity would have to be interested in setting up shop inside an existing territory and offer a competitive option. As this is something pretty foreign to how utilities run in the state, we wonder who would be interested in doing such a thing? It would take tens of millions of dollars to install an entirely new infrastructure with the hope that customers who are currently serviced by one utility would be willing to change to a new utility and what would those costs be? How much better would a brand new startup company be and how long would it take for them to be to provide the service in the area? All questions we are hoping the Arizona Corporation Commission will discuss at their next open meeting.
Now that the interim manager (IM) has been appointed and has been granted access to all of the necessary systems in order to run the utility, why is there a discussion about revoking the CC&N? We aren't sure. It could simply be because before Epcor, the current interim manager, was allowed access to JU, the ACC had instructed staff to look into revoking the CC&N and staff is just following through on those instructions. Or maybe there is another plan, that we aren't aware of at this time.
At the upcoming Sept 11th open meeting, we've been told that this item will be discussed. During the open meeting, three options will be considered:
- A complete revocation of Johnson's CC&N
- Deletion from the CC&N those areas that have no customers, no existing infrastructure, and where there have been no requests for service
- Deletion of those areas from the CC&N that have no customers, but where there have been requests for service, allowing those areas of the CC&N to be served by another party willing and able to serve whom a request for service has been made.
We've already discussed what happens if #1 happens - bottom line - nothing really changes - so we wonder, what's the point?
As for #2, we don't understand why this is necessary. If the interim manager has been appointed to address the issues with the managerial, financial and technical challenges Johnson Utilities currently faces, what does removing areas, that have "no customers, no existing infrastructure and where no requests for service have taken place" do for anyone?
Number 3 is the most curious - to remove any area that has no customers, but where requests for service have been made, allowing those areas to be served by another party willing and able to serve whomever requested service - does that mean public utilities that are governed by the ACC or is that a green light for neighboring municipalities to take advantage of their current policies of playing the utility vs annexation game? What does that mean? You can't hook up to our utilities, unless you annex into our land ... sound familiar to anyone? Check out the policies of our surrounding municipalities. So where is there land in the current Johnson Utilities CC&N area that another area could take advantage of? Anyone thinking about commercial development along the new SR24 or the north/south corridor? Well you should be.
We just don't understand why the CC&N is up for discussion right now - why not allow the ACC appointed interim manger, the couple years they have been granted, to address and resolve the issues that this area has been plagued with over the years? Now that the interim manager has been granted access and can actually do the job they were appointed to do, let them do it.
San Tan Valley residents need to be protected. The Town of Queen Creek is looking out for their 4500 JU customers, the Town of Florence is looking out for their 7000 JU customers. But who is really looking out for the remaining 100+K JU customers in San Tan Valley? As far as we can see .... no one ... so it's up to us to be heard.
If you have an opinion regarding this topic, let us know below in the comments or submit your comments here and we'll share your comments with the Arizona Corporation Commission before the Sept 11th open meetings. Or you can submit your opinion directly to the ACC here.