Arizona law currently allows municipal water utilities to purchase privately owned water companies, thereby absorbing the non-municipal customers.  However, while the privately owned companies are subject to regulation and oversight by the Arizona Corporations Commission, municipal water utilities are not, even when they operate outside their municipal boundaries. In addition, the non-municipal consumers have no vote, no voice, in electing the municipal governing body and, without regulation, have no avenue to register a complaint against the municipal water utility.

            The recent increase in water service rates by one municipal water utility serves as an example.  "Inside Service Customers" - those living within city limits, saw an increase of 30% in their monthly service charge. "Outside Service Customers" - those living outside city limits, saw an increase of 67% in their monthly service charge, more than double.  Currently, the Arizona Corporations Commission and Utility Division do not accept complaints regarding municipal water utilities, leaving the "Outsiders" no recourse. This is a loophole in the law which is being exploited by municipalities to raise capital from non-municipal customers for municipal expenditures that are not necessarily beneficial to those being exploited. This must be changed to ensure ALL Arizona citizens are protected from unfair treatment.