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Article 12: Franchise and Public Utilities

Sec. 1. Franchises.

A person desiring to obtain a franchise to operate a public utility from this city shall present the franchise desired to the city council of the city and it shall be filed among its records. If the council deems the granting of the franchise beneficial to the city, it shall pass a resolution stating that fact, and shall submit the question to the qualified voters, as to whether or not the franchise shall be granted, at the following regular election held in the city or at a special election called for that purpose.

The proposed franchise shall be published prior to the election as required by state law or ordinance.

If a majority of the votes cast are in favor of granting the franchise, the council shall grant the franchise only in the form filed and published.

A franchise shall not be granted for a longer term than twenty-five (25) years.

Before calling any such election, the estimated expense of publication and election thereof (to be determined by the council) shall be first deposited by the applicant for such franchise with the city clerk.

Sec. 2. Establishment of municipally owned and operated utilities.

The city shall have the power to own and operate any public utility, to construct and install all facilities that are reasonably needed, and to lease or purchase any existing utility properties used or useful to public service. The city may also furnish service to adjacent and nearby territories which may be conveniently and economically served by the municipally owned and operated utility, subject to the limitations of the provisions of the general laws of this state. The council may provide by ordinance for the establishment of such utility and provide for its regulation and control and the fixing of rates to be charged. The council may by ordinance provide for the extension, enlargement or improvement of existing utility, and provide reasonable reserves for such purpose.

Sec. 3. Establishment of classifications and regulations of rates of public utilities.

The city shall have full power to and may prescribe just and reasonable classifications to be used and just and reasonable rates and charges to be made and collected by all corporations rendering public utility service within the corporate limits of the City of Scottsdale as now or hereafter constituted, except public service corporations as such corporations are defined and the regulation thereof delegated to the Arizona Corporation Commission by article XV, section 2, Arizona Constitution..

The city council may establish such boards as are necessary and convenient to discharge its duties pursuant to this enactment. The powers hereby conferred shall be exercised by the city council pursuant to ordinance providing for hearings and investigations and establishing procedures to be followed in determining and fixing fair value of any such utility property and a reasonable rate of return and providing for suitable penalties, civil and criminal, for violation of any lawful order or requirement made or imposed pursuant to any regulatory ordinance or in furtherance of any regulatory investigation.