One day after filing a response to Attorney General Mark Brnovich's petition to the state Supreme Court seeking her removal from office, Arizona Corporation Commission Chairwoman Susan Bitter Smith resigned from the powerful regulatory body, effective January 4.
In a statement issued today, Bitter Smith, a Republican, defended herself against allegations of a conflict of interest, slamming Brnovich as the cat's paw of a "dark money group" she did not name.
"I fear that this distraction will continue," Bitter Smith wrote. "The public deserves the full attention of the Commission and its staff to the upcoming body of work facing the Commission...In light of this, I have decided to resign effective January 4th, to allow for time for the Governor to appoint a replacement and to do a short transition."
On November 30, Brnovich announced that he was asking the Supreme Court to force Bitter Smith's ouster. His office believes that the commissioner, who was elected in 2012, had violated a state conflict-of-interest law by lobbying for cable companies, while sitting on the AZCC.
The commission regulates telecommunications companies, among others, but not cable companies, per se.
However, cable companies often sell bundled services that include phone service.
Bitter Smith is a registered lobbyist for Cox Communications. She also heads up the Southwest Cable Communications Association, which has cable companies as members. These cable companies pay dues to be a part of SCCA. In turn, the nonprofit pays Bitter Smith a salary of $150,000 per year. That's in addition to her yearly CorpCom salary of $80,000.
The chairwoman has argued, to no avail, that she only represents the cable portions of those businesses, and she repeated that argument at length in her resignation statement, saying the phone service provided by cable companies "involves the transmission of data over the internet" and so is "outside the Commission’s current jurisdiction."
She contended that she receives "no pecuniary gain" from the apparent conflict, because the $150K salary she receives is from businesses "not regulated by the Commission."
But Brnovich's complaint points out that the cable companies and their telecommunications affiliates are inextricably intertwined, part of a larger corporate structure, with decisions made by parent entities.
"This isn't getting into a gray area, or someone skating close to the line," he asserted during the press conference. "This isn't something we're doing willy-nilly...we're doing this because we believe we have to."
The matter initially was brought to the attention of the AG by Chandler attorney Tom Ryan, a fierce champion of ethics in government who played similar roles in the downfall of other politicians, such as former Attorney General Tom Horne and ex-state Senate President Russell Pearce.
Reached for comment, Ryan praised Brnovich for going after a fellow Republican.
"I truly appreciate the political courage shown by Attorney General Mark Brnovich in pursuing this matter," he told New Times. "I also appreciate the fine effort by Assistant Attorney General [and Criminal Division chief] Don Conrad and his team for doing further investigation and truly putting the whole weight of the Attorney General's Office behind this effort."
Ryan also issued a challenge to Governor Doug Ducey to appoint a retired judge of the governor's choosing to serve out the remainder of Bitter Smith's term.
The ex-judge should not be associated with any dark money group or any industry, Ryan said, and he or she should not run for the seat in 2016.
"We need to bring credibility back to the corporation commission," Ryan said, "the very credibility that's been damaged by the chicanery over the last two election cycles."
Ryan, a Republican-turned-Independent, says he is not working for any group or person when it comes to the legal action he filed with the AG's office in September, nor is he getting paid to do it.
He credits KJZZ reporter Kristena Hansen for bringing Bitter Smith's conflict of interest to his attention and for breaking the story.
A criminal investigation of Bitter Smith by the Attorney General's Office is pending. And there are other, unrelated complaints against the commission that the AG is looking into.
Ryan was asked why he thought Bitter Smith filed a response to the AG's complaint, a response that probably cost a bundle in legal fees, then resigned the following day.
If you like this story, consider signing up for our email newsletters.
SHOW ME HOW
You have successfully signed up for your selected newsletter(s) - please keep an eye on your mailbox, we're movin' in!
The attorney chalked it up to "denial" on Bitter Smith's part.
"Go back and look at everything Susan Bitter Smith and her team have said in her defense," Ryan observed. "About me, they said, `Oh, this is a disgruntled Democrat, a dark money guy,' and they said, `Mark Brnovich will make quick work of [dismissing] it.'"
"But none of that has turned out to be true."