By Jim Small| Jeremy Duda | Arizona Mirror
Arizona voters went to the polls in 2014 to elect new members to the Corporation Commission, which regulates most utilities in the state. The state’s largest utility, Arizona Public Service, secretly spent millions of dollars to influence their vote.
The utility’s hand-picked regulators – both Republicans – won, and APS benefitted from having staunch allies on the regulatory commission. For example, APS got a large rate hike approved in 2017, as well as a huge cut in how much the utility pays to purchase electricity generated by homeowners with solar panels.
As a result, the stock price of Pinnacle West, the publicly traded parent company of APS, began a steep ascent, climbing more than 50 percent.
But it wasn’t just the large institutional shareholders that own the bulk of Pinnacle West stock who saw massive profits: Don Brandt, the CEO of both APS and Pinnacle West, has been awarded more than $42 million worth of stock as part of his compensation package. And since that 2014 election, he has sold nearly 400,000 shares of Pinnacle West totalling more than $32 million.
It has also enriched board members and executives at both APS and Pinnacle West, who are given stock as part of their pay packages.
Brandt announced in August that he will retire in November. He steps down in the wake of pressure from the Corporation Commission – which now is controlled by APS critics – to reveal the extent of his company’s political activity and a scandal in which an elderly customer died after her power was disconnected on a hot summer day because she was $51 behind on her bill.
An Arizona Mirror analysis of Brandt’s stock sales since 2010 and historical values of Pinnacle West stock, the New York Stock Exchange and an index fund for utility companies shows that Brandt was able to make at least about $5 million more on those sales because Pinnacle West’s stock price skyrocketed, far outpacing both the overall stock market and the utility sector.
A spokeswoman for APS declined multiple requests for comment from the Arizona Mirror over the course of about two months.