ARIZONA STATE SENATE

KATI PRATT

ASSISTANT RESEARCH ANALYST

ANNA NGUYEN

LEGISLATIVE RESEARCH ANALYST

GOVERNMENT COMMITTEE

Telephone: (602) 926-3171

RESEARCH STAFF

TO:                  MEMBERS OF THE SENATE

GOVERNMENT COMMITTEE

DATE:            February 9, 2026

SUBJECT:      Strike everything amendment to S.B. 1571, relating to affordability; utilities; marketing expenses

Purpose

Prohibits a monopoly utility with a defined customer base from passing through any costs to a customer that are associated with marketing, partnerships, advertising, community relations, sponsorships or any other similar activity. Outlines annual reporting requirements for a monopoly utility with a defined customer base.

Background

The Arizona Corporation Commission (ACC) may supervise and regulate every public service corporation in Arizona and do all things, whether specifically designated in statute or in addition to, necessary and convenient in the exercise of the ACC's power and jurisdiction. In supervising and regulating public service corporations, the ACC's authority is to adopt rules to:
1) protect the public against deceptive, unfair and abusive business practices; 2) intrusive and abusive marketing; and 3) deceptive or untrue advertising practices. The Legislature may enlarge the powers and extend the duties of the ACC and prescribe rules and regulations to govern proceedings institute by and before it. Until such rules and regulations are provided by law, the ACC may make rules and regulations to govern such proceedings. A public service corporation must comply with every order, decision, rule or regulation made by the ACC in any matter relating to or affecting its business as a public service corporation and must do everything necessary to secure compliance with and observance of every such order, decision, rule or regulation (Ariz. Const. art. 15, § 6; A.R.S. § 40-202).

There is no anticipated fiscal impact to the state General Fund associated with this legislation.

Provisions

1. Prohibits a monopoly utility with a defined customer base from directly or indirectly passing through any costs to a customer that are associated with marketing, partnerships, advertising, community relations, sponsorships or any other similar activity.

2. Requires a monopoly utility with a defined customer base to annually report, to the Governor, the President of the Senate and the Speaker of the House of Representatives, its marketing, partnerships, advertising, community relations, sponsorships or any other similar activity, and include any expenses that were derived from private monies.

3. Requires a monopoly utility with a defined customer base to attest, in the annual report, that the expenses were not indirectly or directly passed through to customers for marketing, partnerships, advertising and sponsorships.

4. Requires a monopoly utility with a defined customer base to post the report on its publicly accessible website, which must be available on its homepage, and keep all reports available online.

5. Defines monopoly utility with a defined customer base as a utility that has exclusive authority to provide utility service within a defined service area and for which customers located in that service area are required to receive utility service from that utility.

6. Makes technical and conforming changes.

7. Becomes effective on the general effective date.