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Home / Featured News / Flipping Switches: APS power broker Marty Shultz moves on after 32 years

Flipping Switches: APS power broker Marty Shultz moves on after 32 years

Marty Shultz (Photo by Ryan Cook/RJ Cook Photography)

Marty Shultz (Photo by Ryan Cook/RJ Cook Photography)

It’s hard not to pay attention to the man behind the curtain when he’s working the room and shaking hands.

Like the power lines that transmit his company’s electricity across the state, Marty Shultz’s influence reaches nearly every nook and cranny in Arizona.

As the chief lobbyist and agent for Pinnacle West and its Arizona Public Service (APS), the state’s largest utility company, Shultz has played key roles in some of the biggest policy initiatives of the past three decades. And his service with dozens of charitable and civic organizations has produced shelves full of awards.

To some, he’s a visionary who helped drag Arizona into the 21st century. To others, he’s the gladhanding lobbyist who imposed APS’s will on a reluctant state and served as a bagman for big-ticket government spending.

Either way, the imprint he’ll leave on the state is undeniable.

“He’s the reason we have planes, trains and automobiles,” said lobbyist Kevin DeMenna. “That doesn’t just come from representing a major business interest. You have to be the right person to make that work. That combination – Marty just had the right DNA, I guess.”

When Interstate-10 stopped at 59th Avenue, Shultz and APS helped guide it through the city. When Arizona needed more electricity to fuel its rapidly growing population, Shultz took a lead role in building the nation’s largest nuclear power plant. And when Phoenix residents complained that their downtown paled in comparison to other big cities, Shultz helped make it more vibrant.

But when school boards and parents fought his dream of school-district unification, Shultz was there to watch it go down in flames. And when a blockbuster plan to pay for transportation infrastructure through a sales tax increase fizzled out, Shultz was the target of ridicule by opponents who celebrated its defeat.

As Shultz, 66, prepares to leave Pinnacle West after 32 years, the company’s vice president of government affairs leaves behind the legacy of a power player who helped shape modern Arizona on behalf of his company.

After more than 40 years in the public arena, which includes stints at the Phoenix Mayor’s Office and with the Phoenix Suns, Shultz knows every major business owner and politician in the state. He is a natural-born social butterfly and a coalition-builder who can walk into almost any room and be everyone’s best friend.

That has made him the perfect fit for APS, which has a broader view of its role than probably any company in the state, said lobbyist Barry Aarons. As Arizona’s largest utility, nearly every major policy affects APS, and the company, in turn, expends a great deal of energy trying to influence them.

“There’s a lot to be said that over the years APS has had a disproportionate influence in this community and in this state,” Aarons said. “When you combine that with a capability like Marty has, I think it’s created a very powerful, influential force.”

Even before he came to APS in 1979, and before he built up the connections that came with the job, those qualities were visible. When then-Phoenix Suns owner Jerry Colangelo needed a director of sales, marketing and promotion, he looked to the Mayor’s Office, where Shultz was chief of staff to then-Phoenix Mayor Margaret Hance, the third-consecutive mayoral administration he served.

“In establishing ourselves in the community, we needed people who were young, aggressive, respsected, articulate. Marty knew his way around early and was always a great communicator,” Colangelo said.

DeMenna, who first met Shultz in the early 1980s when DeMenna was a Senate intern, said the best word to describe Shultz is ‘prolific.’ Shultz not only knows everyone, DeMenna said, but seems to be everywhere at once. Shultz serves on dozens of boards of directors, task forces, community panels and charitable organizations.

According to rumors that will soon become legends, Shultz often works 18 to 20 hours a day.

“I remember getting a glimpse of his calendar once, and he had three breakfasts scheduled for the same period of time,” DeMenna said.

For many, however, Shultz’s work has been a source of frustration for years. Critics believe APS has had too broad a role in shaping Arizona’s policy, especially when it comes to issues that raise taxes, increase government spending and leave the company and government so intertwined that it’s difficult to tell where one ends and the other begins.

Tom Jenney, director of the Arizona chapter of Americans for Prosperity, said APS has a vested interest in presenting itself as a good corporate citizen because it is a regulated utility and beholden to government. As APS’s chief lobbyist, Shultz is the face the company’s wide-ranging efforts and he ends up with a great deal of the criticism when people oppose its plans.

“At the end of the day, a business lobbyist like Marty Shultz is in the business of tilting the market so that it favors his industry,” said Jenney, who battled Shultz on proposed sales tax increases in recent years. “They have to be what government thinks is a good corporate citizen. So if the fad in government is solar power or renewable energies, at some point, even if it doesn’t make economic sense, a big, regulated public utility is going to talk a lot about how it likes solar power and renewables.”

Shultz’s activities have been a source of frustration for some, even those who seem like they should be allies, such as Arizona’s other utility powerhouse, Salt River Project (SRP).

Russell Smoldon, SRP’s chief lobbyist, said APS takes a much grander view of its role in society than SRP does. He said Shultz’s work on seemingly non-utility issues has inadvertently put SPR and other utilities at odds with lawmakers and other power brokers.

In the early 1990s, for example, Shultz and APS were pushing for tax hikes to pay for education and to help ease the budget deficit, Smoldon said. In response, lawmakers passed a different tax proposal that targeted utilities and mines.

Smoldon said Shultz is both one of his best friends and greatest nemeses, and joked that Shultz mentored him when he first came to SRP by showing him what not to do.

“A lot of times when Marty’s out there swinging in the breeze about some issue that pisses off legislators, the utilities get creamed,” Smoldon said.

Shultz’s work outside of APS has drawn a lot of fire as well. In 2008, he spearheaded an effort to unify and consolidate school districts, which was fiercely opposed by many school boards and ultimately failed. The battle got so heated that some opponents sent letters to APS, which authorized but did not sponsor Shultz’s involvement, demanding that the company fire him.

“They wrote letters to our board of directors saying I shouldn’t be involved in this activity,” Shultz said.

In 2008, Shultz and APS took the lead in organizing then-Gov. Janet Napolitano’s TIME initiative, a one-cent sales tax increase that would have paid for a host of transportation projects. That initiative didn’t make it onto the ballot after more than 122,000 signatures were found to be invalid.

Shultz said he was “totally devestated” by the failure of the TIME initiative, which came about 20 years after a similar proposal called ValTrans failed at the polls.

Ultimately, Shultz has had a lot more successes than failures. The light-rail system that Shultz pushed as part of the ValTrans proposal finally became a reality in 2008. Modern freeways crisscross the Phoenix metro area thanks to a countywide sales tax that Shultz helped shepherd along to win voter approval. He was instrumental in multiple downtown revitalization projects. And he played a lead role in building Maricopa County’s Human Services Campus in downtown Phoenix.

Shultz describes his critics as naysayers who oppose modernization by attacking the messenger. The broad role APS has taken in Arizona is appropriate for a company with interests that touch nearly every corner of the state, he said.

“I see that as a business strategy because we’re building the communities that we serve. And it makes eminent sense. And it actually makes business sense,” he said. “Because they use electricity, it’s our business. The economics of that are: You build the facilities, you get more sales, you spread your fixed cost over a larger base, and your unit cost is less.”

Shultz’s retirement marks the end of an era for APS, and the company is promoting two people, Gretchen Kitchel and Jessica Pacheco, to fill the role he has occupied for decades. Smolden, however, questioned whether the company would ever be able to truly replace him.

“You get access by who you represent and how you represent them. If one of those two dynamics changes, it changes the direction dramatically,” Smoldon said.

Shultz has no plans to fade away. He’s staying tight-lipped for now on what his future plans are, but said they will keep him involved in government and politics. He also said he will continue advocating for his dream of school-district unification, which he touts as a way to make the districts more efficient and put more money into classrooms.

Shultz also plans to stay active in many charitable and civic endeavors. He chairs the board of directors for Jobs for America’s Graduates, recently accepted the Anti-Defamation League’s Jerry T. Wisotsky Torch of Liberty Award for his work against discrimination, and serves on the board of the Arizona Save-a-Life Alliance, among myriad other organizations he works with.

Lobbyist John Mangum said Shultz’s charitable work, civic activism and community involvement is greatest contribution to the state.

“When other people were just busy doing their jobs, Marty did his job, plus he did all these other things for the community,” Mangum said. “I don’t know all that much about what he did at APS … but the community stuff, the charity stuff is the stuff that really matters.”

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