Wednesday, November 25, 2020 3:58 am

Concern over debt agreement raised as hearing begins on sale of Johnson Utilities; Court Rich, co-founder of Rose Law Group, weighs in

(Disclosure: Rose Law Group represents landowners and homebuilders working with the ACC to find a utility solution in the Johnson Utilities service area.) 

By Suzanne Adams-Ockrassa | Florence Reminder Blade Tribune

PHOENIX — The biggest concern raised during opening statements in a hearing Wednesday on the possible sale of Johnson Utilities to EPCOR Water was an agreement to defer about $45 million in debt related to the sale and allow the new owners to recoup those debt costs through future rate cases.

Johnson Utilities serves a large area of Pinal County that includes San Tan Valley, Florence and Queen Creek. The utility has been in financial trouble for several years and allegations of the misuse of funds and mismanagement of the company have been made against the family that owned and operated the utility for many years. EPCOR was named as an interim manager for the business about two years ago.

EPCOR announced its intention to purchase the utility in October. In order for the sale to go through, it must be approved by the Arizona Corporation Commission.

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“On the first day of the hearing a key agreement was reached between EPCOR, ACC Staff and RUCO that should help clear the way for approval of the acquisition. The parties agreed between themselves to a $45 million differed debit that would replace the previous request that was made for a larger acquisition premium. 

‘This differed debit will be recovered over 15 years via a surcharge on customer bills and will save customers a lot of money compared to the earlier request.”

Court Rich, Rose Law Group co-founder, senior partner

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