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ArizonaHB 2679Fifty-seventh Legislature - First Regular SessionHouseWALLET

power; public utilities; UCC; securities

Sponsored By: Gail Griffin (Republican)

Signed by Governor

aaa rating (s)application for rehearing (s)authority of qualified special purpose entity (s)choice of law (s)civil action (s)conflicts with other laws (s)default on transition bonds (s)definitions (s)effect of invalidity on actions (s)fees and taxes (s)financing charges (s)financing resolution (s)financing resolution adoption (s)irrevocability (s)issuance (s)judicial review (s)legal investments (s)lien (s)noncompliance (s)notice (s)obligations of successor to public power entity (s)power - title 30priority (s)property rights (s)public debt prohibition (s)public meeting (s)public policy (s)public power entity (s)public utilities (s)public utilities and carriers - title 40reimbursement of costs (s)scope (s)securitiessecuritization proposal (s)securitization transactionssecurity interest (s)servicer (s)statement of public policytransition billing services tariffs (s)transition bondstransition propertytrue-up mechanism (s)ucc (see also: uniform commercial code)uniform commercial code (ucc)uniform commercial code - title 47

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 0 costs, 3 mixed.

Utility bonds can fund transition costs

Arizona public power entities, electric utilities, and cooperatives can use Transition Bonds to pay eligible retirement, replacement, or disaster-recovery costs. Approval requires a finding that the deal lowers customers’ costs over time; replacement generation must also be more cost-effective than continued operation of a retiring facility. Bond proceeds go to the applicant after upfront costs are deducted. If the bond entity decides not to issue authorized bonds, the public power entity or applicant must repay certain costs; a delay during appeals does not trigger repayment.

Bond charges avoid some local taxes

Covered financing charges are exempt from certain local franchise fees and service-related taxes. Arizona and local governments also cannot tax Transition Bond holders or owners of Transition Property. Transition Bonds are not public debt, and governments do not have to raise taxes or set aside money to pay their financing costs. The law does not require any savings from these exemptions to lower customer bills.

Customers pay new bond charges

Covered electric customers must pay financing charges while related bonds remain unpaid or financing costs remain unrecovered. The charge can apply even when a customer owes no other electric bill charges, and partial payments go to the financing charge first. A fixed formula adjusts charges up or down when collections do not match costs; checks happen at least twice a year, and quarterly in the final two years before maturity. Customers receive notice at least 15 days before adjusted charges take effect, and an unpaid charge can lead to a lawsuit; cooperatives may pass their costs on to service users.

Bond payments get strong legal protection

A Qualified Special Purpose Entity owns the Transition Property and related revenues until bonds and financing costs are paid. Financing parties can secure the property with a lien, enforce it after default, and seek court orders to collect revenues if a servicer fails its duties. Successors must continue servicing and payment duties, and the entity can only conduct business tied to the property and bonds. These protections limit government actions that impair payments and limit customers’ ability to use offsets or defenses; special security interests follow separate state rules.

More investors can buy utility bonds

The law allows more public bodies, financial institutions, insurers, and other authorized investors to hold Transition Bonds. A parent, holding company, or direct owner of an applicant that is also a public service company cannot buy those bonds. If Arizona authorizes a third party to bill and collect related charges, the arrangement must meet rating-agency rules needed for an AAA or equivalent bond rating.

Sponsors & Cosponsors

Sponsor

  • Gail Griffin

    Republican • House

Cosponsors

  • Alexander Kolodin

    Republican • House

  • Alma Hernandez

    Democratic • House

  • Beverly Pingerelli

    Republican • House

  • Brian Fernandez

    Democratic • Senate

  • Carine Werner

    Republican • Senate

  • Catherine Miranda

    Democratic • Senate

  • Chris Lopez

    Republican • House

  • Consuelo Hernandez

    Democratic • House

  • David Gowan

    Republican • Senate

  • David Livingston

    Republican • House

  • David Marshall, Sr.

    Republican • House

  • Flavio Bravo

    Democratic • Senate

  • Frank Carroll

    Republican • Senate

  • Hildy Angius

    Republican • Senate

  • James Taylor

    Republican • House

  • Janae Shamp

    Republican • Senate

  • Janeen Connolly

    Democratic • House

  • Jeff Weninger

    Republican • House

  • John Gillette

    Republican • House

  • John Kavanagh

    Republican • Senate

  • Joseph Chaplik

    Republican • House

  • Julie Willoughby

    Republican • House

  • Justin Wilmeth

    Republican • House

  • Kevin Payne

    Republican • Senate

  • Kevin Volk

    Democratic • House

  • Khyl Powell

    Republican • House

  • Laurin Hendrix

    Republican • House

  • Leo Biasiucci

    Republican • House

  • Lisa Fink

    Republican • House

  • Lupe Diaz

    Republican • House

  • Lydia Hernandez

    Democratic • House

  • Matt Gress

    Republican • House

  • Michael Carbone

    Republican • House

  • Michael Way

    Republican • House

  • Michele Peña

    Republican • House

  • Myron Tsosie

    Democratic • House

  • Neal Carter

    Republican • House

  • Nick Kupper

    Republican • House

  • Pamela Carter

    Republican • House

  • Quang H Nguyen

    Republican • House

  • Rachel Keshel

    Republican • House

  • Ralph Heap

    Republican • House

  • Selina Bliss

    Republican • House

  • Seth Blattman

    Democratic • House

  • Shawnna Bolick

    Republican • Senate

  • Steve Montenegro

    Republican • House

  • Teresa Martinez

    Republican • House

  • Thomas "T.J." Shope

    Republican • Senate

  • Timothy "Tim" Dunn

    Republican • Senate

  • Tony Rivero

    Republican • House

  • Venden "Vince" Leach

    Republican • Senate

  • Walt Blackman

    Republican • House

Roll Call Votes

All Roll Calls

Yes: 114 • No: 52

House vote • 5/7/2025

FINAL: Passed

Yes: 43 • No: 15

House vote • 5/7/2025

CONCUR: Passed

Yes: 0 • No: 0

House vote • 5/6/2025

THIRD: Passed

Yes: 17 • No: 11

House vote • 3/25/2025

DP

Yes: 4 • No: 3

House vote • 3/12/2025

THIRD: Passed

Yes: 35 • No: 21

House vote • 2/10/2025

C&P

Yes: 8 • No: 0

House vote • 2/4/2025

DP

Yes: 7 • No: 2

Actions Timeline

  1. Final Reading: Passed

    5/7/2025House

  2. Concurrence: Passed

    5/7/2025House

  3. Third Reading: Passed

    5/6/2025House

  4. Committee of the Whole: do pass amended

    5/6/2025House

  5. undefined: PFC

    3/31/2025House

  6. undefined: DP

    3/25/2025House

  7. Third Reading: Passed

    3/12/2025House

  8. Committee of the Whole: do pass amended

    3/11/2025House

  9. Committee of the Whole: Retained on the Calendar

    3/10/2025House

  10. Committee of the Whole: Retained on the Calendar

    2/18/2025House

  11. undefined: C&P

    2/10/2025House

  12. undefined: DP

    2/4/2025House

Bill Text

Related Bills

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