San Tan Valley resident Steve Pratt filed a closing brief with the Arizona Corporation Commission on Sept. 4 asking regulators to send the remaining balance of a $456,000 legal settlement to EPCOR customers as bill credits, rather than letting the utility hold the money for what he calculates could be decades.

Attached to the brief is an open letter signed by 179 EPCOR customers.

The filing landed in Arizona Corporation Commission docket WS-01303A-24-0130, the same docket that produced EPCOR's current water and wastewater rates. Residents can comment on it, and the deadline has not passed.

Where the $456,000 Came From

The money is what was left over from a class action lawsuit brought on behalf of Johnson Utilities customers who said they had been overcharged. The case settled for more than $10 million, and most of it was already paid out. According to the brief, EPCOR itself distributed more than $4 million in bill credits to more than 30,000 customers.

SanTanValley.com covered that case throughout. For background, see our reporting on the Johnson Utilities class action, the questions residents asked about the settlement, and the distribution getting underway.

What remained was about $456,000, and there was no practical way to divide it up and mail it to individual customers. So a federal court approved what lawyers call a cy pres distribution. That is the term for money from a lawsuit that cannot practically be returned to the people it was owed to, so a court sends it somewhere that benefits those same people instead.

The court directed the remaining money to EPCOR's Low Income Assistance Program, or LIAP, which discounts bills for customers who qualify.

What Pratt Says Changed

Pratt is an intervenor in the case, meaning he was granted formal standing to participate rather than simply commenting from outside.

His argument is not that the assistance program is a bad use of the money. The brief says plainly that the program "plainly does" serve a worthwhile purpose.

His argument is about what happened to two other mechanisms. When the case was presented to the federal court, the paperwork described a system in which a surcharge funded the assistance program, the books were reconciled each year, and any over-collection was returned to customers as a credit on their bills. The brief says those mechanisms have since disappeared, while EPCOR received the $456,000 in cash.

The Numbers He Put in the Record

The brief points to an exhibit already filed in the case, Exhibit SP-1, which projects the long-term effect.

Under the assumptions in that exhibit, after paying the assistance program's costs, EPCOR's net cash retention reaches $988,497 after about twenty years, and the company continues to receive more than $60,000 a year that it would not receive without the settlement money.

The brief also makes a simpler point. At a 5 percent return, $456,000 earns about $22,800 a year. The annual cost of the assistance program in the record is about $16,500. The earning capacity of the money alone is therefore larger than the program it is meant to fund, which is why the brief argues the fund could operate "as a perpetual funding source rather than a finite distribution."

Neither EPCOR nor Commission Staff filed a competing calculation disputing the $988,497 figure, according to the brief.

Where EPCOR and Commission Staff Stand

The brief cites EPCOR testimony that the settlement money can eliminate the assistance program surcharge "for the foreseeable future."

Commission Staff took the position that EPCOR would not benefit financially from holding the funds. Staff also recommended that EPCOR move the money into an interest-bearing account, add the interest earned to the assistance program balance, and report that interest separately each year.

Pratt argues those two Staff positions sit uneasily together. If holding the money produces interest worth capturing for customers, then holding the money has value.

The San Tan Numbers

EPCOR reported 109 San Tan wastewater customers and 96 San Tan water customers enrolled in the assistance program at the end of 2025. Some customers are in both programs, so those figures cannot simply be added together to get a total.

The brief uses that comparison to make a point about scale: the 179 people who signed the open letter represent a group comparable to, and possibly larger than, the entire assistance program population the money is meant to serve.

The signers are not asking for assistance to low-income customers to be cut. The brief is explicit on that. They are asking that the value of the settlement reach customers rather than stay under the utility's control.

Why the Argument Gets Weaker With Time

One section of the brief turns on something that will be familiar to anyone who has watched San Tan Valley grow.

The group of people covered by the original lawsuit is fixed. EPCOR's customer list is not. Every year, some of the original customers move away and new ones arrive who were never part of the case and never paid the disputed charges.

So the longer the money sits, the larger the share of any eventual benefit that flows to people the settlement was never about. The brief argues that connection "does not strengthen with delay. It deteriorates."

What He Is Asking the Commission to Do

The brief requests five things: determine what is left of the $456,000 after legitimate program costs, reconcile what customers have actually received because of it, preserve the value associated with EPCOR holding the cash, distribute the remaining balance through customer bill credits, and, if regulators decide that cannot be done within EPCOR's regulatory structure, send the money back to the federal court to decide what happens to it.

The brief raises two other items as well, including a note that state law HB 2782 takes effect Sept. 12 and governs how deferred regulatory costs are disclosed and recovered.

How to Comment

The Commission takes public comment on this docket. SanTanValley.com has published a fuller guide on how to comment or intervene in this case.

To file a comment directly, use the Arizona Corporation Commission's Utilities Public Comment form. Enter docket number WS-01303A-24-0130 so the comment is filed in the right case.

Before starting, know that the form asks for your name, mailing address, city, state, ZIP and phone number, along with your position on the case and up to 5,000 characters of comment.

This is continuing coverage. SanTanValley.com previously reported on Pratt's earlier filing raising these questions and on the rate case the Commission approved in this same docket. We will report the Commission's decision when it issues.