Trusted local news leader for Kingman, Arizona & Mohave County
Fri, March 22

Questions over lawyers delay Citizens rate hike request process

The Citizens Arizona Electric rate-hike request before the Arizona Corporation Commission is still on hold because of conflict-of-interest concerns with the company's legal council.

ACC administrative law judge Dwight Nodes ruled April 30 that the Gallagher and Kennedy firm had a conflict of interest.

Citizens hired the firm of Brown and Bain as replacement, and a second objection was filed because that firm represented Citizens in other cases.

"The ACC wants to decide the case on the facts without any questions of conflict of interest of the lawyers," Heather Murphy, public information officer for the ACC, said.

"Brown and Bain advised Citizens in a prior dispute with Arizona Public Service.

Nodes must now rule on the second conflict-of-interest complaint.

In the first challenge, he ruled that Michael Gallagher's service on the board of APS since 1997 and his service on the board of Pinnacle West, parent company of APS, would give at least the appearance of a conflict.

APS is the sole supplier of electricity to Citizens.

A sharp jump in what APS charged Citizens for power in the summer 2000 during the California electric crisis is the one of the issues in the case.

The case involves the pass-through of $100 million to Citizens customers for electric costs paid by Citizens to APS.

Gallagher and Kennedy represented Citizens in the rate case since it was filed in September 2000.

Murphy said it was unusual to have the conflict of interest motion filed by Michael Magruder, an intervener, March 13 just days before the issue was going to hearings.

Tom Ferry, Kingman-based electric division manager for Citizens, expressed disappointment in the delays.

Murphy explained that regulatory law is a specialty of a limited number of firms and Arizona does not have many electric companies.

The lawyers tend to work with more than one client, making the conflict of interest decision more complex.

Brown and Bain, if allowed to continue representing Citizens, will have to be given adequate time to prepare the case, Murphy said.


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