The day after the polls closed, Tucson Vice Mayor Lane Santa Cruz wanted to know how Tucson Electric Power would operate without a franchise agreement.
The answer, it turns out, changes the closer city officials and TEP executives get to the April 2027 deadline when the current agreement expires.
The real unanswered question lies beyond that deadline, as both sides prepare to negotiate how TEP will continue to use public rights of way, obtain permits and continue paying city taxes and permit fees.
As it stands, the current 2.25% franchise fee generates roughly $14 million annually for Tucson. Customers pay it through their electric bills, and TEP hands over the money to the city.
Voters last week rejected a proposed franchise renewal for the second time since 2023, prompting questions about how the privately owned, for-profit utility will continue to operate in Tucson.
One of the biggest questions: What does the future look like for TEP?
Spoilers ahead — TEP isn’t going anywhere.
Operating without an agreement might cost TEP more money and, TEP argues, could slow down repairs. But we’re still skeptical that crews will take up painting while waiting for the city to sign off on individual repairs.
TEP for Tucson, the utility-funded campaign supporting Prop 421, ran ads featuring crews painting and reading books, arguing longer repair times would be one of the potential consequences of rejecting the measure.
Keep in mind, providing electricity to the Tucson area is good business. TEP reported $254.6 million in net income during the first nine months of 2026, according to its latest financial filing with the U.S. Securities and Exchange Commission. (That’s companywide income, including its operations outside the city limits. TEP is owned by Fortis Inc., a Canadian company whose shares trade on the Toronto and New York stock exchanges.)
Tucson City Attorney Roi Lusk told the Tucson City Council on Wednesday that the city will soon begin discussions with TEP about how it will operate after the franchise expires, potentially under a annual license agreement.
“One of the things that we’ll want to determine first is just sort of the basics: How do they operate in the right of way? And then how we manage their permits and those sorts of things,” Lusk said.
Lusk offered few details of what that agreement would look like but said the arrangement could be “similar” to the current agreement.
Opponents, including Public Power for Tucson, Tucson Democratic Socialists of America, No Desert Data Centers and the Tucson Raging Grannies, and used social media to criticize Prop 421.
Currently, Tucson customers pay a 2.25% franchise fee plus an effective 2.75% public utility tax. Together, they total 5%. The franchise fee counts toward the city’s public utility tax, which increased to 5% in March.
When the franchise fee expires, customers would instead pay the full 5% utility tax, city officials told the council.
City Manager Tim Thomure told the council he expects the city to continue collecting the revenue it is entitled to receive.
“Our position will be that they still give us all the revenue to which we’re entitled. It would just come in a tax instead of a tax and a fee,” Thomure said.
This doesn’t include the payments starting at $2 million a year that TEP would have made under a separate Energy Collaboration Agreement (ECA) included as part of Prop 421.
Those payments would have increased 2% annually to support energy affordability, sustainability and community resilience projects. TEP was required to pay the ECA and could not recover those funds through customer rate increases.
Jobs like fixing power lines could get more complicated without a franchise agreement.
Thomure said the city might need additional staff to handle more permit applications if the franchise expires without a replacement arrangement.
And that could prompt the city to reexamine its permit fee schedule to cover the additional staffing costs.
TEP spokesman Joe Barrios told us on Friday that it is too early to know what a replacement arrangement will look like, but the goal is to get one in place before the current franchise agreement expires.
“We will need to sit down with the city to see what the next steps are. We will establish the most efficient method to work with the city to maintain and upgrade TEP’s grid,” Barrios said.
The length and terms of any replacement agreement remain to be decided, with the council’s approval.
And for what it’s worth, the expectation is TEP and the city will put another franchise agreement on the ballot in the future.
If you were looking for someone to put a damper on the Democrats’ election celebrations, Congresswoman Adelita Grijalva isn’t right for the job.
The Congressional District 7 Democrat sat down with radio host Bill Buckmaster on Friday and had plenty to celebrate: Democratic wins in the Arizona Legislature, a sweep of statewide races and control of both the U.S. House and Senate.
Grijalva is “ecstatic” — a change of pace for someone who spent 20 years on a school board dealing with Republican control of the Legislature and governor’s office, as she reminded Buckmaster and his co-host, Nogales International editor Dan Shearer.
“We have an opportunity to really rebuild in the state of Arizona,” Grijalva said, calling the election of Democrats a rebuke of President Donald Trump.
And she had a few parting words for Republican Congressman Juan Ciscomani.
Grijalva said her incoming Democratic colleague, JoAnna Mendoza, had left Ciscomani “blown out of the water” in what is generally considered a competitive congressional district.
“He sold out to Donald Trump. He turned his back on CD6 constituents. He forgot who sent him there and why he was sent,” Grijalva said, adding that Trump’s MAGA movement is “dead for the most part.”
As for what Democrats will do with their House majority, Grijalva said Trump’s veto threats won’t dictate the agenda.
“We can’t allow the threat of a Trump veto to stop us from putting forward legislation that’s going to help working families,” Grijalva said.
But if you were hoping for another Trump impeachment or a fight over who gets the speaker’s gavel, Grijalva wasn’t offering much encouragement.
She argued Democrats don’t have enough votes in the Senate to convict and remove Trump from office. And as of Friday afternoon, nobody was challenging Democratic U.S. Rep. Hakeem Jeffries for the speaker slot.
Tucson’s stock is rising: For the first time in recent memory, three Tucson-area lawmakers will hold powerful positions at the Legislature. The political chatter last week suggested Democratic Sen. Priya Sundareshan would get the nod as the next Arizona Senate president. Her Democratic colleagues made that a reality after a vote on Friday. They also picked Rep. Nancy Gutierrez to be majority leader in the state House (they’re in charge of setting caucus priorities) and picked Rep. Kevin Volk to be one of the whips in the House (in charge of whipping votes).
What to do with all that power: Those same Arizona Democrats have a big question to answer: Now what? Senate Democrats said the new majority “will make lowering costs for Arizona’s working families its top priority,” which seems to jibe with Arizona Daily Star columnist Tim Steller’s advice to “avoid the temptation to turn the tables on Republicans after suffering decades of bullying by the GOP majority.” Meanwhile, labor unions are pushing Democratic lawmakers to focus on helping workers, like establishing a prevailing wage, and Gov. Katie Hobbs wants lawmakers to focus on issues that cross party lines, such as “lower costs, safe neighborhoods, a secure border, good schools, and water for generations to come,” KJZZ’s Wayne Schutsky reports.
The call is literally coming from inside the house: In what is becoming one of the most bizarre local government stories we’ve seen this year, Tucson city prosecutor Matthew Walker was placed on administrative leave after police said at least two of the harassing emails sent to his wife came from an IP address associated with their home, Analeise Mayor reports for the Star. That revelation came after a months-long legal battle with Walker and his wife Shannon on one side and convicted stalker — and prolific YouTuber — Lane Myers on the other, as the Republic’s Taylor Seely has reported in recent weeks.
The man behind the curtain: We now know the person who is behind the data center the Cochise Regional News was trying to track down last month. One-time trillionaire and full-time weirdo Elon Musk says his SpaceX is going to spend $50 billion on a 747-acre campus near the Willcox Playa. If the campus gets built, it would be the largest data center project in Arizona and use more than twice as much electricity as every data center in Maricopa County combined, Clara Migoya reports for the Republic. But first, Musk and Co. will have to wade through local zoning laws and persuade local residents, including those who booed a SpaceX rep at Cochise Elementary School last week, Mark Hays reports for the Herald/Review. One resident noted they “fought tooth and nail” to get groundwater protections last year, while another echoed one of the main problems data center companies face: The public doesn’t trust them.
“I know they’re going to give us a line about how they’re not going to use that much water, but I don’t know what regulations, laws, or constraints are going to be put on them to actually follow through with that,” a resident said.
On a sweeter note: The Tohono Chul Gardens are now home to cuttings from ancient cottonwoods that were cut down in Lochiel to make way for the wall along Arizona’s border with Mexico, the Arizona Luminaria’s Stephanie Casanova reports. After contractors cut down three of four cottonwoods in July, protesters tried to save the last one by sitting in it for 71 days, but ultimately the Trump administration cut down the tree, known as “grandmother,” last month and arrested protesters. After the first three trees fell in July, environmental advocate Maxie Adler traveled to Lochiel and found “bursts of new growth and leaves still present, signs of life and health” remaining in one of the toppled trees.
Tucson immigration attorney Mo Goldman did his best impression last week by ad-libbing “Do you hate political signs? DO YOU REALLY HATE POLITICAL SIGNS?”
Before you mutter your answer, Goldman was telling everyone they can now do anything they want with the “What’s Juan hiding?” political signs his PAC put out right before election.
Although we don’t think they can be turned into hats as he claims.
Goldman gives it away at the end of his post.
“This exclusive offer will last until I get off my lazy ass next week and take any leftovers down!” he wrote.
It’s one way to get a souvenir from the 2026 election — but please don’t get ideas about other signs just yet.
Taking down a political sign is still a class 2 misdemeanor until 15 days after Election Day.
