Business

Queen Creek may want to purchase Johnson Utilities

(Source: SanTanValleyCentral): Kelly Fisher

QUEEN CREEK — The town of Queen Creek may be seeking to purchase Johnson Utilities, according to multiple state lawmakers.

But a town spokesman said there’s nothing in the works.

Rep. T.J. Shope, R-Coolidge, told PinalCentral that Queen Creek representatives spoke with him and other representatives in a brief meeting last week about the apparent idea to purchase the Scottsdale-headquartered San Tan Valley water and sewer provider.

 It was Shope’s impression during his conversation with Queen Creek officials that the idea is that if Johnson Utilities suddenly “can’t provide or do whatever,” the town would be interested in purchasing the company or having an agreement of some kind in place.

Shope suggested PinalCentral speak with the town’s public works director, whom he said he spoke with Wednesday; Director Troy White, however, is out of town until Monday, according to his voicemail.

Queen Creek is mostly in Maricopa County but extends into Pinal. San Tan Valley is a large unincorporated community nearby in northern Pinal County.

Queen Creek spokeswoman Constance Halonen-Wilson told PinalCentral that there had not been any discussion “publicly” among any town officials — or anyone else, such as state representatives, for that matter — of an interest or potential to purchase Johnson Utilities.

“As I mentioned on the phone, the Town has not made any recent efforts to actively pursue purchasing Johnson Utilities and the Town is not in negotiations with anyone from Johnson Utilities,” she wrote in a follow-up email.

Halonen-Wilson said in a separate follow-up email that perhaps some of the “confusion” could trace back to a recent Arizona Corporation Commission hearing at which a town representative testified regarding Certificates of Convenience and Necessity for some property in the town’s planning area.

Halonen-Wilson said the property is about a square mile and that the “owner and the Town have been in discussions about annexing into Queen Creek, and the property owner has requested consolidated utility services by the Town; not a split development where (Johnson Utilities) provides sewer and the Town provides water.

“This may be where the confusion is coming from,” she suggested. “I wanted to clarify that while the Town addressed the ACC on this nearly one mile section of land, the Town is not in negotiations with (Johnson Utiliites), the ACC, (Arizona Department of Environmental Quality) or anyone concerning acquiring (Johnson Utilities).”

That hearing took place June 12.

But according to Shope’s account, he wasn’t the only elected official to hear of the town’s apparent interest on Wednesday in what he called a 10- to 15-minute conversation, pointing to Rep. Doug Coleman, R-Apache Junction, as an example.

Coleman told PinalCentral that “they’ve been talking for quite a while” about purchasing the utility company, but he doesn’t know “how solid the plans are.”

Shope said that the town officials’ reasoning to speak to state representatives about the idea was “strictly more about awareness than anything else,” and Coleman reiterated that the purpose of the short meeting seemed to be to keep the representatives informed.

“I think Queen Creek has been working with (Johnson Utilities President) George Johnson,” the former Apache Junction mayor guessed, “(but) I’m not sure how fruitful those (interactions) have been,” if they took place.

 Brad Cole, chief operating officer for Johnson Utilities, who apparently has assumed the role of managing the daily responsibilities at the company in light of Johnson’s recent indictment on bribery and other charges, did not return PinalCentral’s call for comment by press time.

Shope pointed out it’s “not a brand new thing” for a nearby municipality to have an interest in going after Johnson Utilities.

In 2007 and 2013, the town of Florence considered buying Johnson Utilities, aiming for a stronger influence in planning area and attracting businesses.

The first time around, it was “the height of the economy,” and the Town Council didn’t trust future growth projections, Assistant Town Manager Jess Knudson said in a previous PinalCentral story.

At first, Florence officials considered just buying the portion of the system that serves residents of the town but ultimately arrived at the conclusion that the company’s integrated system could not be purchased in pieces.

A town news release around that time stated that the purchase price was lower than for Queen Creek’s H2O water company earlier that year.

“Any time a city or town can gain control over their infrastructure, I think that’s a good thing,” Coleman said of Queen Creek’s possible interest in purchasing the utility company. “I think Queen Creek has capacity and is able.”

Though Queen Creek officials told PinalCentral that there are no active efforts to purchase the San Tan utility company, Shope said confidently: “It is accurate they are interested.”