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RECEIVED : AZ CORP c0mr4lssi0r; DOCKET CONTROL i l FREDENBERG BEAMS Daniel E. Freudenberg - 020 l58 2 Christian C. M. Beams - 019672 2018 JUL lb A Q: 2 b 4747 N. 7th Street, Suite 402 Arizona CorporationCommissio 3 Phoenix, Arizona 85014 Telephone: 602/595-9299 DOCKETED 4 Email: dtrcdenbers1(au fblcgalamupxom Email: creamsQ a thlegalgroupcoln JUL 16 2018 5 Attorneys for Johnson Utilities, LLC nooxsnsn Y 6

7 BEFORE THE ARIZONA CORPORATION COMMISSION

8 COMMISSIONERS 9 TOM FORESE, Chairman 10 BOB BURNS ANDY TOBIN l l BOYD DUNN JUSTIN OLSON 12

13 IN THE MATTER OF THE No. WS-02987A-18-0151 COMMISSION'S INVESTIGATION OF 14 JOHNSON UTILITIES, LLC WATER 15 OUTAGES MOTION TO DISQUALIFY COMMISSIONER ANDY TOBIN 16

18 19 Commissioner Tobin must be disqualified from further participation in this matter 20 because he had at least one improper ex parte meeting with Pinal County Supervisor Mike 21 Goodman discussing alleged water outages and pressure issues at Johnson Utility - issues 22 that are highly material to deciding whether to impose outside management on Johnson. 1. STANDARDS FOR RECUSAL OF CORPORATION COMMISSIONER 23 24 The quasi-judicial nature of contested proceedings before the Arizona Corporation 25 Commission has been long recognized. Slate ex rel. Corbin v. Ariz. Corp. Comm 'n, 143 Ariz. 219, 225, 693 P.2d 362, 368 (App. 1984). Thus, a defendant in such a proceeding has 26 a due process right to have an impartial commission decide his case. 27 28 l We start from the premise that there are certain "fundamental" procedural requisites

2 which a person is entitled to receive at an administrative hearing which is quasi-judicial in

3 nature. One is a decision by an impartial decision maker. 4 Rouse v. Scottsdale Untied School Dist., 156 Ariz. 369, 371, 752 P.2d 22, 24 (App.

5 1987). This means that such proceedings "must be attended, not only with every element of

6 fairness but with the very appearance of complete fairness." Horne v. Polk, 242 Ariz. 226,

7 234, 1128, 394 P.3d 651, 659 (2017) (internal quotation marks omitted).

"The United States Supreme Court has categorically stated that a 'fair hearing` is 8 denied in quasi-judicial administrative proceedings when the linder of fact reaches his 9 decision otter ex parte communications from one side." Western Gillette, Inc. v. Ariz. Corp. 10 Comm'n, 121 Ariz. 541, 543, 592 P.2d 375, 377 (App. 1979) (quoting Morgan v. United l l States,304 U.S. l, 20 (1938). Thus, the results of an ACC rate-setting proceeding were

12 voided and the hearing officer disqualified in Corbin because there was improper ex parte

13 contact between the presiding hearing officer and counsel for the utility. Corbin, 143 Ariz.

14 at 232-34, 693 P.2d at 375-76.

15 Against this backdrop, such ex parte communications are expressly forbidden under

16 the Arizona Administrative Code. A.A.C. R14-3-l l3(C)(2) instructs in no uncertain terms:

17 No commissioner or commission employee involved in the decision-making process of a contested proceeding ... shall request. entertain or consider an 18 unauthorized communication concerning the merits of the proceeding . ...

19 Unfortunately, as shown below, such an ex parte communication has occurred here.

20 ll. MR. TOBIN MUST BE DISQUALIFIED.

21 On Friday July 6, 2018, Commissioner Andy Tobin. a long-standing critic of

22 Johnson Utilities, "met with" Pinal County Supervisor Mike Goodman and Arizona State

23 Representative TJ. Shope "regarding water outages and pressure issues experienced by

24 customers of Johnson Utilities in Pinal County." Shape Press Release (July 6. 2018) (copy

2 l attached as Exhibit "A"). Of course, "water outages" is a precise issue before the 2 Commission in this docket.' 3 This June 6 meeting strongly suggests that Mr. Tobin and Mr. Goodman are 4 working behind the scenes to obtain a predetermined outcome in this proceeding. Just as in 5 Corbin, this necessarily taints any result in which Mr. Tobin would participate in a quasi- I 6 judicial role. Only the immediate recusal of Mr. Tobin from further participation in this 7 matter, including informal communications with other Commissioners concerning this 8 matter, can begin to ameliorate that taint.See Corbin, 143 Ariz. at 232-34. 693 P.2d at 375- 76. 9 Ill. CONCLUSION 10 Johnson Utilities respectfully asks Mr. Tobin to voluntary recuse himself from l l further participation in this matter. Should he decline to do so, Johnson Utilities asks the 12 Commission to stay all further proceedings until an action to disqualify Mr. Tobin can be 13 brought in Superior Court. 14 RESPECTFULLY SUBMITTED this 4 Rh day of.luly, 2018. 15 FR BERG BEAMS 16 By: 17 Daniel E. Freudenberg Christian C. M. Beams 18 Attorneys for Johnson Utilities, LLC 19

20 ORIGINAL and thirteen (13) copies filed this " day ofluly, 2018, with: 2 l 22 Docket Control ARIZONA CORPORATION COMMISSION 23 1200 West Washington Street Phoenix, Arizona 85007 24 25 COPIES of the foregoing e-mailed or mailed this th day of July, 20 lb, to: 26

27 1 Pinal County has also been granted intervention in the WS-02987A-18-0050 and WS0287A-l -0392 dockets, and this Motion has been simultaneously filed in those 28 dockets as well.

3 l Andy Kvesic, Director-Legal Division Daniel Pozefsky, ChietCounsel 2 ARIZONA CORPORATION RESIDENTIAL UTILITY CONSUMER 3 COMMISSION OFFICE 1200 W. Washington Street I l I() W. Washington Street, Suite 220 4 Phoenix, Arizona 85007 Phoenix, Arizona 85007 Lc2alDN a azcc.gov 5 'Q dpozefsky rcl azrueo.com [email protected] procedural a !azruco.gov 6 Consented to Service b E-mail 1ti1cntes(u.azruco.gov CIIZlUIOb:CI»2lZTIlCO.2OV/'N 7

8 Consented to Service by E-mail Albert H. Acker Scott A. Holcomb 9 RYLEY CARLOCK & APPLEWHITE David J. Ouimette One North Central Avenue, Suite 1200 10 DICKINSON WRIGHT PLLC Phoenix, Arizona 85004 1850 N. Central Avenue, Suite 1400 11 aackeniv a rcalaw.com Phoenix. Arizona 85004 Consented to Service b E-mail iohn.kross(Z1)quecncreek.or,<1 12 [email protected] 13 douimettc( u2 dickinsonwriahtcom Consented to Service b E-mail 14 C Gifford Mattice, Town Attorney 15 Kent Volkmer Brent Billingsley, Town Manager Kevin Costello 16 775 N. Main Street PINAL COUNTY ATTORNEY PO Box 2670 K€vl[l.cosl€ll0\(l/ fpinalcountvaz.gov 17 Florence Arizona 85 132 Kellv.pilel&?pinalcountvaz.gov / 18 Cli llbrd.MatticcKa> llorenccaz.gov Kelsevxpickard.(iipinalcountyaz.govI Brentlkillingsley a( Qllorcnccaz.,Qov Consented to Service by E-mail 19 Consented to Service by E-mail 20 21 !»; 22

4 EXHIBIT A TJ Shope - Facebook Posts

1:J. Shops for Arizona i s I contacting T.J Shope for Arizona with TJ Shops x 6Julyat 17:21 . 6 This Press Release was sent out about an hour ago regarding the ongoing issues with Johnson Utilities following a meeting at the State Capitol today... Friday, July 6, 2018 FOR IMMEDIATE RELEASE Representative Shope Meets with Commissioner Tobin on Pinal County Water Outages and Pressure Issues STATE CAPITOL. PHOENIX - Representative TJ Shope (R.8). along with Pinal County Supervisor Mike Goodman today met with Arizona Corporation Commissioner Andy Tobin regarding water outages and pressure issues experienced by customers of Johnson utilities in final County. Commissioner Tobin updated Representative Shope and supervisor Goodman on the multiple dockets opened investigating Johnson Utilities issues and expressed hope that the Corporation Commission will hold a special meeting to expunge Johnson Utilities' Certificate of Convenience and necessity for failing to meet a previous compliance deadline. "We're in the middle of fire season, and relighters in Pinal County are having to haul their own water because our hydrants don't have sufficient water pressure to meet code- that's completely unacceptable," said Representative Shope. "l'm grateful to Commissioner Tobin for meeting with supervisor Goodman and me today and for all his hard work addressing the water issues in San Tan valley. l'll continue to monitor the situation and do what I can to ensure that these issues are resolved as expeditiously as possible." ##411

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