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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
corporation commission; utilities; amortization; tariffs
Purpose
Prescribes disclosure requirements for the Arizona Corporation Commission (ACC) and public service corporations if a regulatory asset is included in rate base or otherwise reflected in the rates based on a test year or historical balance.
Background
Under the rules and regulations prescribed by the ACC, every public
service corporation must file with the ACC, and must print and keep open to
public inspection, schedules showing all rates, tolls, rentals, charges and
classifications to be collected or enforced, together with all rules,
regulations, contracts, privileges and facilities which in any manner affect or
relate to rates, tolls, rentals, classifications or service. The ACC may, from
time to time, approve or fix rates, tolls, rentals or charges in excess of or
less than those shown by the schedules. The ACC may also approve or fix rates,
tolls, rentals or charges that do not match with the schedules and prescribe
such changes, by order, in the form of the schedules that demonstrate expediency
(A.R.S.
§ 40-365).
No change may be made by any public service corporation in any rate, fare, toll, rental, charge or classification, or in any rule, regulation or contract relating to or affecting any rate, toll, fare, rental, charge, classification or service, or in any privilege or facility, except after 30 days' notice to the ACC and to the public. The notice must be given by filing with the ACC and keeping open for public inspection new schedules stating plainly the change to be made in the schedules then in force, and the time when the change will go into effect. The ACC, for good cause shown, may allow changes without requiring the 30 days' notice by an order specifying the changes to be made, the time they will take effect and the manner in which they will be filed and published (A.R.S. § 40-367).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Requires the ACC and a public service corporation, if a regulatory asset is included in rate base or otherwise reflected in the rates based on a test year or historical balance, to disclose:
a) the unamortized balance of the regulatory asset as of the rate effective date;
b) the difference between the test year balance and the rate effective date balance;
c) the total amount of amortization expense expected to be recovered over the period the rates are in effect; and
d) if a public service corporation's regulatory assets include either assets whose rate base value remains fixed until the next rate case or assets whose rate base value declines in proportion to the amortization of the unamortized balance, the public service corporation must disclose the treatment applied to each category of regulatory asset and indicate whether and how rate base will be adjusted over time to reflect declining balances for the assets subject to such adjustment.
2. Specifies that nothing in the prescribed disclosure requirements requires the ACC to adopt any particular adjustment mechanism, but the prescribed disclosure requirements do require the ACC to ensure that the disclosures are sufficient to compare the total amounts that will be recovered in rates against the remaining unamortized balance of regulator asset.
3. Contains a statement of legislative intent.
4. Becomes effective on the general effective date.
House Action
NREW 2/17/26 DPA 5-3-0-2
3rd Read 2/26/26 34-19-7
Prepared by Senate Research
March 13, 2026
SB/hk