Gilbert Mayor Jenn Daniels

Clean Energy

A legal challenge to the Clean Energy for a Healthy Arizona ballot initiative has high-profile backing from two East Valley mayors.

Mesa Mayor John Giles and Gilbert Mayor Jenn Daniels both signed on as plaintiffs on the lawsuit that challenges the ballot initiative, although they won’t discuss their reasons.

The challenge comes from Arizonans for Affordable Energy, a group funded by APS parent company Pinnacle West.

If passed by voters, the measure would require some Arizona electricity providers to pull at least 50 percent of their electricity from renewable sources by 2030.

Arizonans for Affordable Energy argues that the initiative, if passed, could double customers’ electric bills.

DJ Quinlan, spokesman for Clean Energy for a Healthy Arizona, pushed back at that allegation.

He said that a study commissioned by Natural Resources Defense Council and performed by energy firm ICF found that the initiative would reduce average electricity bills in Arizona by $3 per month in 2030 and result in $4 billion in savings between 2020 and 2040.

Giles and Daniels referred all questions to Matthew Benson, director at Veridus, a lobbying and public relations firm contracted by APS.

Benson said he was unsure whether Arizonans for Affordable Energy reached out to the mayors to sign on to the lawsuit or if Giles and Daniels approached the group to add their names to the complaint.

“It is entirely possible we reached out to them,” Benson said.

Quinlan said, “APS is a bad actor, but they have been partners to a lot of folks throughout the years, so it’s not surprising that you will have some institutional folks on their side.”

Both mayors received financial support from the utility during the 2016 election cycle.

Giles’ and Daniels’ campaigns each received a $500 donation from the Pinnacle West Political Action Committee during that time. Daniels also received two additional donations totaling $70 from APS employees.

The inclusion of Giles and Daniels in the lawsuit is odd on the surface because APS is not a major player in Mesa or Gilbert.

SRP is the primary electricity provider in both municipalities.

APS provides electricity to a small pocket in northwest Gilbert. Mesa’s city-owned utility also provides power to 5.5 square miles around downtown and sources its power from a pool of multiple providers

However, according to Benson, the Clean Energy initiative could have negative affects on customers outside APS service areas by causing cost increases on goods in neighboring communities.

”Regardless of if you live in APS territory or not, the initiative is going to impact every Arizona family and business owner in this state if you purchase products or leave the house and venture out into this state,” he said.

Benson said the plaintiffs are concerned about what he described as deliberately misleading language included in the petition – an allegation also raised in the lawsuit.

“One of the significant issues raised is the initiative implies that this is going to apply to all utilities in the state,” Benson said. “It actually excludes SRP. There are concerns from some individuals that this misleads SRP customers to think that their utility is going to be impacted by this.”

That sentiment mirrors Giles’ complaint in the lawsuit, which states that he is concerned that the petition did not make it clear that SRP is not affected by the initiative, according to court documents.

Quinlan said the campaign deliberately crafted clear language and worked with energy experts, including Kris Mayes, a Republican and former Corporation Commission member who helped craft Arizona’s current renewable energy standard.

“It is far from what they are saying,” he said. Quinlan said that the initiative mirrors the renewable energy standard adopted by Arizona in the mid-2000s and “just upped the percentage” of renewable energy from 15 percent by 2025 to 50 percent by 2030.

Daniels challenged the initiative on different grounds. The lawsuit states that she believes a “significant number of submitted signatures were forged, fabricated or collected by ineligible petition circulators.”

That is a point expounded upon in the lawsuit.

Overall, the lawsuit raises a host of questions with the initiative and challenges the validity of a majority of the signatures backers collected to qualify the initiative for the November ballot.

Backers collected 480,000 signatures, well over the minimum of 225,963 valid signatures needed to qualify for the statewide election. However, the lawsuit alleges that most of those signatures are invalid and “at most, the committee obtained 106,441 valid signatures.”

Arguments in the lawsuit include that Clean Energy supporters collected signatures from people not registered to vote and that some circulators did not legally qualify to collect signatures in Arizona.

It mentions that committee may have used convicted felons who had not had their voting rights restored, though Arizonans for Affordable Energy was only able to identify 85 such individuals who collected just 168 signatures. 

Later, Arizonans for Affordable Electricity filed a memo with the court stating they had actually identified more than 20,000 signatures collected by circulators with felony records who had not had their voting rights restored.

Quinlan said the focus on felons is a “recycled” topic that APS has used in the past, referencing tactics employed by Arizonans for Affordable Energy on social media and television in which it warned residents about interacting with signature collectors who may have a criminal history.

“The normal process for this coming out is when the secretary of state and county recorders are checking signatures,” Quinlan said. “If they find circulators that were felons and had no right to vote, that is when they are uncounted.”

He added, “APS used this ahead of time before we turned in signatures as a scare tactic.” Quinlan said the campaign had every circulator fill out a form attesting that they had voting rights and also were subjected to background checks.

“The nature of that business is you are going to come across some folks that lie on their forms,” he said, noting that the campaign purposefully gathered over 250,000 extra signatures in the event some are ruled ineligible.

APS lawyers also attempted to argue that all signatures should be invalid, because the Clean Energy campaign failed to list a sponsor as required by Arizona state law.

Maricopa County Superior Court Judge Daniel Kiley said it is possible that initiative organizers did not comply with state laws that require all ballot measures to list a “sponsor’’ before gathering signatures. He also said ruling on that question was outside of the court’s jurisdiction.

APS attorneys said that even after a sponsor finally was named, it was not the legally correct one. They contend petition signers should have been told up front virtually all the money was coming from NextGen Climate Action, the political action committee formed by California billionaire Tom Steyer.

But Kiley said none of that matters.

Kiley said if this actually violates some state election law – something he is not deciding – only the Secretary of State’s Office has the legal authority to do something about it. And the most that could happen, the judge said, is the campaign could be fined if it did not come into compliance.

Kiley said APS and Pinnacle West Capital Corp. have no legal right to try to enforce the election law, meaning it cannot move to disqualify all 480,000 signatures on those grounds.

Kiley said that the utility remains free to try to prove its contention that three-fourths of the signatures gathered are invalid. He scheduled a trial for later this month to tackle that issue.

But Kiley said rejected a demand by APS that Arizona’s 15 county recorders, also defendants in the suit, do the company’s investigation.

He said the only duty of recorders is to check the 5 percent sample each gets of the total signatures submitted. Based on that sample, state election officials decide if there are at least 225,962 valid signatures to put the proposed constitutional amendment on the ballot.

And Kiley said there is nothing in state law that requires – or even authorizes – county officials to perform such a line-by-line review. He said it’s up to the utility to make the case on its own.

-Howard Fischer of Capitol Media Services contributed to this report.

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