Arizona Administrative Code
Title 14 - PUBLIC SERVICE CORPORATIONS; CORPORATIONS AND ASSOCIATIONS; SECURITIES REGULATION
Chapter 2 - CORPORATION COMMISSION - FIXED UTILITIES
Article 8 - PUBLIC UTILITY HOLDING COMPANIES AND AFFILIATED INTERESTS
Section R14-2-803 - Organization of Public Utility Holding Companies

Universal Citation: AZ Admin Code R 14-2-803

Current through Register Vol. 30, No. 38, September 20, 2024

A. Any utility or affiliate intending to organize a public utility holding company or reorganize an existing public utility holding company will notify the Commission's Utilities Division in writing at least 120 days prior thereto. The notice of intent will include the following information:

1. The names and business addresses of the proposed officers and directors of the holding company;

2. The business purposes for establishing or reorganizing the holding company;

3. The proposed method of financing the holding company and the resultant capital structure;

4. The resultant effect on the capital structure of the public utility;

5. An organization chart of the holding company that identifies all affiliates and their relationships within the holding company;

6. The proposed method for allocating federal and state income taxes to the subsidiaries of the holding company;

7. The anticipated changes in the utility's cost of service and the cost of capital attributable to the reorganization;

8. A description of diversification plans of affiliates of the holding company; and

9. Copies of all relevant documents and filings with the United States Securities and Exchange Commission and other federal or state agencies.

10. The contemplated annual and cumulative investment in each affiliate for the next five years, in dollars and as a percentage of projected net utility plant, and an explanation of the reasons supporting the level of investment and the reasons this level will not increase the risks of investment in the public utility.

11. An explanation of the manner in which the utility can assure that adequate capital will be available for the construction of necessary new utility plant and for improvements in existing utility plant at no greater cost than if the utility or its affiliate did not organize or reorganize a public utility holding company.

B. The Commission staff will, within 30 days after receipt of the notice of intent, notify the Applicant of any questions which it has concerning the notice or supporting information. The Commission will, within 60 days from the receipt of the notice of intent, determine whether to hold a hearing on the matter or approve the organization or reorganization without a hearing.

C. At the conclusion of any hearing on the organization or reorganization of a utility holding company, the Commission may reject the proposal if it determines that it would impair the financial status of the public utility, otherwise prevent it from attracting capital at fair and reasonable terms, or impair the ability of the public utility to provide safe, reasonable and adequate service.

D. A notice of intent under this section is not required when the reorganization of an existing Arizona water or wastewater public utility holding company is due to the purchase of the shares of (or merger with) a Class D or E water or wastewater utility.

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