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HB 2509

USE/OCC TX-ROAD MAINTENANCE

104th Regular Session Introduced by Jed Davis

HB 2509 bars ratepayer funding of political activities by utilities, prohibiting contributions, lobbying and listed nonrecoverable expenses, with required separate reporting.

Rule 19(a) / Re-referred to Rules Committee
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Bill Summary · HB 2509

HB 2509 — Summary (Introduced version, Arizona)

Note: The draft text provided contains two different bill texts labeled “HB2509” (one from Arizona concerning campaign contributions and utility spending; another unrelated Illinois tax exemption draft). This summary focuses on the Arizona “Introduced” version (amendments to Arizona Revised Statutes) because it is the detailed text provided and matches the listed sponsors and legislative status.

Purpose / Intent

HB 2509 aims to limit political influence by utilities and to prevent utilities from recovering certain corporate, political or advocacy-related expenses from ratepayers. It (1) narrows the ability of regulated public service corporations and public power entities to fund political committees or influence elections for the Arizona Corporation Commission, (2) identifies categories of expenditures that cannot be charged to ratepayers, and (3) prohibits use of ratepayer monies to lobby the Legislature and adds a related reporting requirement.

Key Provisions

  • Amends ARS §16-916 (campaign finance):

    • Adds subsection prohibiting a public service corporation regulated by the Arizona Corporation Commission, and public power entities (per ARS §30-801), from making contributions to:
    • Any PAC that makes expenditures (including independent expenditures) for or against any candidate for the Corporation Commission.
    • Any 501(c)(3) or 501(c)(4) organization that makes expenditures to influence Corporation Commission elections.

  • Adds ARS §40-363 (nonrecoverable expenditures):

    • Prohibits a regulated public service corporation, its parent, subsidiaries, and public power entities from spending ratepayer monies on specified items, including (summary):
    • Memberships/dues/sponsorships/contributions to entities exempt under IRC §501 (including trade associations).
    • Charitable giving (including to §501(c)(3)/(c)(4) orgs) and related expenses.
    • Advertising.
    • Compensation that partially supports political influence or advertising.
    • Litigation regarding existing/proposed federal, state or local regulations, legislation or ordinances.
    • Costs for unregulated products or services (marketing, customer service, etc.).
    • Penalties or fines (including tax penalties/fines).
    • Travel, lodging, gifts, entertainment, food/beverage for boards/officers (or affiliates).
    • Owned/leased/chartered aircraft for boards/officers (or affiliates).
    • Investor relations.
    • Any individual annual compensation exceeding the Governor’s current annual compensation.
    • Direct/indirect costs associated with attendance/participation/preparation/appeal of contested proceedings before the Commission (including attorney/expert fees, employee salary portions, consultants, etc.).

  • Adds ARS §41-1232.09 (lobbying/reporting):

    • Prohibits public service corporations, their parents and subsidiaries, and public power entities from spending ratepayer monies to lobby the Legislature.
    • Requires entities that do lobby (using non-ratepayer funds) to file reports under ARS §41-1232.02 or §41-1232.03 that describe the source of monies used to lobby.

Who Is Affected

  • Regulated public service corporations (those under the Arizona Corporation Commission), their parent companies and subsidiaries.
  • Public power entities as defined in ARS §30-801.
  • Trade associations, nonprofits, and PACs that currently receive utility funding or corporate support.
  • Ratepayers — protections against bearing costs of the above activities, assuming enforcement and cost allocation changes.
  • Utility legal/advocacy budgets (e.g., litigation and legislative advocacy) and executive compensation practices.

Procedural / Status Notes

  • Introduced February 5, 2025.
  • Status shown as Rule 19(a) / Re-referred to Rules Committee.
  • Sponsors include Rep. Mariana Sandoval (primary) and multiple cosponsors listed.
  • The bill amends ARS §§16-916 and adds ARS §§40-363 and 41-1232.09.

Potential Impacts (practical)

  • Would restrict utilities from passing many political, advocacy, litigation and certain corporate expenses through rates — shifting costs to shareholders or requiring internal reallocation.
  • Could reduce direct ratepayer-funded political influence by utilities and limit utility participation in trade association activities or litigation funded by ratepayer dollars.
  • May increase compliance, reporting and administrative burdens for utilities and raise legal questions about scope (e.g., definitions, first amendment and regulatory jurisdiction), which could prompt litigation or administrative rulemaking to implement and enforce the new provisions.

If you want, I can (a) prepare a one-page fact sheet for stakeholders, (b) draft plain-language Q&A on the new nonrecoverable expense categories, or (c) compare this bill to similar measures in other states.

Compiled from official sources — confirm details with the bill’s official record.

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