For nearly 40 years, Shultz has been a prominent fixture in Arizona’s political arena. He served as chief of staff for three Phoenix mayors and for the past 31 years has served as vice president for government affairs at Pinnacle West Capital Corporation, which owns Arizona Public Service (APS), the state’s largest utility company. Outside of his official duties, Shultz is active in a number of civic organizations and political causes, such as the Anti-Defamation League, the Valley Citizens League and the ill-fated TIME initiative.
Shultz has watched Arizona’s tremendous growth for the past several decades and urges the state to prepare for decades more. The APS lobbyist, civic activist and consummate political insider sat down with the Arizona Capitol Times to talk about the 2010 elections, the chances for more nuclear power and why he has never run for office.
It’s been a rough year for everyone. How has it been for APS?
Historically we as a company were part of the growth industry, enjoying anywhere from 6-8 percent growth in electric usage and the customer increases in usage as part of new homes, new hookups and that kind of thing. But in the last couple of years, because of the downturn in the economy, we have continued to grow, but at less than 1 percent.
That was a challenge this year because a couple of things happened.
Number one, you don’t just pull in your belt. You change a lot of your processes and you reduce positions, and a lot of your fellow workers decide to retire early and that kind of thing. So there have been significant changes at APS in terms of the leadership of the organization, the reduction in the workforce, the reduction in our costs. And for the last two years we have been working on a rate settlement, if you will, a whole settlement of many issues with the Arizona Corporation Commission.
You’ve said you hope to see more nuclear power in Arizona, but the federal government, which would have to OK such a move, doesn’t seem to be moving in that direction.
The last nuclear power plant that was built in America was the third unit at the Palo Verde Nuclear Generating Station. And those three plants … have been online and operating for the last 20 years successfully.
However, in our resource plan, we show the potential of nuclear beyond 2020. Having said that, it’s very unclear at the federal level if we would be able to even have the feds entertain an application at this stage. So we’re not filing any applications for new (plants). That’s not our intention at this point. We’re focusing on the renewable energy policy. We’re focusing on the use of natural gas.
We’re also trying to hold onto our coal-fired plants, because at this stage … the federal government has several rules, the EPA specifically, that they are promulgating, having to do with emissions issues and visibility issues that could threaten the use of coal in Arizona.
This threat by the EPA and ultimately by the current administration on the future use of coal is a serious concern for the industry because we’re the company that’s responsible to keep the lights on, and we need to use all sources.
In addition to Democratic lawmakers, the Arizona Education Association also has opposed Brewer’s tax plan. What do you think of the group’s stance on the issue, considering that the tax hike is being billed as a source of revenue for education?
I’m not going to mince words. I can use words like ‘disappointed,’ but I’m more than disappointed in the organizations that have not seen fit to support the revenue increase that Gov. Brewer and many in the business community think is totally appropriate.
Do the math. It is time for Republicans and Democrats of all stripes to come together with the governor and to devise a financial plan and a plan for economic investment in Arizona that makes sense.
Any predictions you want to make for the 2010 election season?
Well, at this stage we have so many announced candidates on the Republican ticket for governor that it’s hard to keep a scorecard. But there are a lot of them. While I give all of them credit for public service, I will tell you that if they tear each other apart, they will render the Republican Party crippled, and that won’t be helpful to the Republican Party.
Terry Goddard, on the other hand, has run several times before, has deported himself well as the mayor and as attorney general, and I think he has a fair chance. … I don’t think this is a circumstance where there’s an odds-on favorite because there’s too many mixed messages, too much frustration about the downturn in the economy. And frankly, Gov. Brewer is new to the electorate as a governor. Even though she is an incumbent, she really rose in a unique way. But don’t all of our governors since Jack Williams, by the way, rise in that unique way?
I know the Democrats think that they’re going to take over the Legislature, but they would have a better chance of doing that if they would assume a little more responsibility for the challenges that the Legislature has, especially in this budget area. And so far they have, as a group, voted no, and I don’t think that helps them with the general electorate, because I think the general electorate has an expectation that we will all – I’m talking about all the elected officials – come together to resolve this very difficult problem. So I would encourage them to do it.
Do you think Brewer will survive the GOP primary?
I’d give the incumbent the nod to survive a brutal primary. And it will be brutal.
You’ve been very active and influential in the political arena for a long time, and one source went as far as to describe you to us as “the most powerful Arizonan since Geronimo.” Is that in any way accurate?
I don’t know if the word ‘powerful’ is a fair term. I would say ‘very active’ is a fair description. I’m willing to take leadership, and I encourage my colleagues to do the same, and that is my lobbyist colleagues as well. And I am really darn proud of a lot of them, because lobbyists get a rap for being a shadow government or walking in and out of the halls or the seats of power.
As far as yours truly is concerned, I’m going to continue to stay active well beyond my employment with APS. If that equates to power, so be it. I really equate it to activity, caring and passion. And I’m passionate about this state and I’m passionate about what our possibilities are, absolutely.
You just turned 65. Any plans for retirement from APS?
I don’t have any specific plans for retirement, but since I did just turn 65 and I look out there, I know that I will work for this company beyond the 2010 election. But I would say that I will not be working for this company during the next presidential election, which will be in 2012.
I will then, as a free agent, be the biggest advocate for Arizona Public Service Company that they’ve ever had because I believe in our mission and Pinnacle West. And I also intend to stay active with several of the organizations that I’m now involved in.
You’ve been in the political arena for decades but have never run for office yourself. Why didn’t you ever decide to take that plunge?
I have had … friends of mine who are notable in our community suggest that I should run, because I’ve been involved in the political arena through the business community. While I really do appreciate people making sacrifices for public service – and it is a big sacrifice – I really haven’t given it any serious thought because I think that the role and the responsibilities that I have are enough.
I do think that some people are built for being elected officials and some aren’t. I’m a pretty good manager and hopefully a pretty good advocate, but I don’t hold any aspirations to be an elected official.
Your job and civic involvement activities bring you to a lot of big- time events. Whose events and parties are the most fun?
First of all, I think one of the best civic dinners is the Anti- Defamation League dinner and the Torch of Liberty every year. Maybe I say that because I’ve been the chairman of the Society of Fellows that puts that on, but that really is a good dinner.
I think that any party at the University Club in Phoenix is a fun party. I would say that recently, and Randy Pullen may call me after I make this comment, but the Democrats are putting on a party that’s a whole lot more fun than the Republicans these days when they get their whole party group together. I think the Republicans seem to be bogged down by the seriousness of the burden of being in charge.
The best political dinner in my recollection is the Jon Kyl political dinner, where Jon periodically raises money for his re-election. And the Jon Kyl dinner oftentimes features a basket that has fried chicken, and singing, including singing by Glenn Campbell and Jon Kyl himself.
What do you like to do in your rare moments of spare time?
Fortunately, I have a very devoted and good-sport wife, Linda. We’ve been married for 45 years. She just finished a two-year bout with cancer and so far beat it. But she’s been a good sport about going along with these things. We travel. We have four grandchildren – Max and Riley and Jessica and Brittany – and we spend as much time with our grandchildren.
I like to read, play a little tennis. I work out a lot. And those are all fun things. Because I am active around town, I pay attention to restaurants, and we like to go to good restaurants. The theater in Arizona – specifically I’m thinking Dodge Theater, I’m thinking Gammage and I’m thinking the entertainment venues – are really pretty special.
Interestingly enough, I enjoy going to the races. Turf Paradise is one of the fun places in town, and if you haven’t gone you should try it, because for two bucks, a little bet on the ponies is fun. And besides that, you’re contributing to the state’s economy.
You’ve been going to Phoenix Suns games for 40 years. What’s the best game you’ve been to?
I’m sort of gravitating to the games that we played against Chicago when we were playing for the NBA championship, when Jordan and Paxson didn’t clean our clocks at the end. But they ultimately beat us.
Which Arizona team would you most like to see win a championship?
I think I have to give a nod to the NBA and to the Phoenix Suns. I’ve watched them long enough and rooted for them long enough and agonized in our efforts to find a big man.
So I’d give it to the Phoenix Suns, even though right now, at this time in our history, I’m feeling the second coming of the Cardinals, if you will, to the playoffs might surprise a lot of people, as …
they did last year.
What’s the best book you’ve read in the past year?
If I have to pick out one, I think it’s a book called “The Big Sort” by a journalist named Bill Bishop. And what he did is he took a lot of different demographics and data and showed us how we were in fact divided in this country. Not as obvious as the divisions we have, for example, in Congress or the divisions we have between Republicans and Democrats. But we are segmenting into urban and a small group of rural. We’re segregating ourselves into ghettos of common thought.
It’s a little frightening.