Details On Why And What It Means

By The United Citizens – Clean Air Clean Water

It may have looked “strange” as to why EPCOR “suspended” the Interim Manager (IM) Contract with the Arizona Corporation Commission (ACC) so soon. It’s important that we all read the contractual obligations of the IM, the Arizona Corporation Commission, and Johnson Utilities; what they all need to commit to in order for the contract to be official.

Number 1 – 

In Section 1.2 of the IM contract – it says the following: ” ….this Agreement will be subject to an immediate, full, complete, and indefinite suspension should there be any reason for EPCOR, as Interim Manager, to believe that any of the conditions set forth in Section 1.2.1 through 1.2.4. (the “Conditions Precedent”) are not being met or are no longer being met. See the screenshot below:

Number 2 – 

Johnson Utilities refused to allow EPCOR to access financial systems – Section 1.2.1 says the following: “Commission shall have taken any and all action necessary to provide EPCOR with full and exclusive access to and control over all revenues paid by customers of Johnson for utility service or by third parties as contributions or advances in aid of construction or otherwise, whether such revenues are currently paid into financial institutions account controlled by Johnson or a Johnson Affiliate.”

Since Johnson Utilities is violating the ACC procedure of the IM assignment by refusing access of the “financial institutions”, EPCOR was instructed – based on section 1.2 of the contract – to suspended the IM contract.

Hypothetically, if the towns of Queen Creek and Florence were given the IM assignment, they would also run into the same exact issue.

The ACC now needs to proceed with the legal process, proving that Johnson Utilities is violating the law. The next hearing is set for August 24, 2018, at 9:00 am to determine whether Johnson Utilities should be held in contempt of violating ACC regulations.

You can view the full agreement here interim-manager-agreement.