Tucson voters will decide this November whether to approve or deny a new 25-year agreement between the City of Tucson and Tucson Electric Power. 

Proposition 421 asks voters to allow the city to enter into a franchise agreement with TEP, a privately owned utility whose parent company is Canada-based Fortis Inc. TEP holds a monopoly on electricity service in the Tucson metro area and has operated under a 25-year franchise agreement with the City of Tucson since 2000. 

That agreement was set to expire in April 2026, but was extended through April 2027 after voters rejected a proposed renewal in 2023. 

What happens if it passes?

If approved, a new agreement would give the private power company the right to build, maintain and operate electric transmission on public rights-of-way. The agreement includes the same 2.25% franchise fee that existed in the previous agreement. That fee is reflected in customers’ bills under taxes and assessments. 

The agreement also includes a “voluntary Energy Collaboration Agreement” where TEP would invest $2 million per year on sustainability projects, with funds increasing 2% each year. That investment is estimated to total $64 million over 25 years. The funding could help with bill assistance for low-income households, increased tree canopy or resilience hubs with solar battery storage, according to the city. 

What happens if it fails? 

TEP would still provide electricity to Tucsonans if Prop. 421 fails. 

If voters reject the franchise agreement, TEP would have to go to the city for individual permits each time they intend to work in public rights-of-way. 

TEP argues that without an agreement, permits “could take longer to approve, potentially slowing projects and outage response efforts.”

TEP ad spending

TEP ads have made their rounds on social media and TV commercials, giving voters messages like, “Vote yes on Prop. 421 and keep our energy reliable.” 

TEP for Tucson, the political action committee supporting the proposition, has spent almost $1.5 million on TV ads, Tucson Agenda reported after reviewing Federal Communications Commission records. 

“Basic jobs that right now only take hours could require weeks of red tape instead,” TEP for Tucson argues on its website. 

TEP for Tucson also spent $14,000 reimbursing 59 people who submitted arguments in favor of Prop. 421 to the city’s voter pamphlet which is mailed to every Tucson household, the Tucson Agenda reported. Including an argument in the publicity pamphlet costs $240. 

The ads seem to imply a grim new reality if the proposition doesn’t pass: power outages will last longer after major storms and Tucsonans’ bills will increase as repairs become costlier.

The opposition

At the Sept. 22 Tucson City Council meeting, dozens of Tucsonans filled city hall to show their opposition to Prop. 421.  

Opponents say locking into a 25-year deal is bad for Tucsonans because TEP has requested a second rate hike in four years, which would increase residential bills an average of 14% if approved by the Arizona Corporation Commission. 

TEP also entered into a power service agreement with the developers of the large-scale data center Project Blue, despite wide opposition to the data center from Pima County residents.  The contract was approved by the Arizona Corporation Commission in December. 

Residents opposed to the franchise agreement say TEP’s priority is to profit off Tucsonans struggling to pay their bills. 

During the call to the audience in that late September meeting, Aurora Ramirez, an organizer with the Party for Socialism and Liberation, asked the city council to explore a public power option instead. As a social worker, Ramirez said she often hears stories from people who have to choose between paying rent and paying their electricity bill. 

Ramirez said the $2 million investment is a drop in the bucket compared to the company’s almost $2 billion in profits. “If we weren’t making a profit for TEP, we could plant those trees,” Ramirez said. 

Fortis reported earnings of $1.7 billion in Canadian dollars (More than $1.2 billion in U.S. dollars) in 2025, according to a news release on the company’s website. 

“A “YES” vote holds Tucsonans captive to a monopoly obligated to its shareholders, not the public,” the Party for Socialism and Liberation wrote in its argument against the proposition. “Prop. 421 is a referendum on TEP’s rule over our city. Voting “NO” empowers Tucsonans to renegotiate on our terms and pursue a utility system that is sustainable, affordable, publicly accountable, and controlled by the people it serves.”

Support for Prop. 421

While TEP and many of its supporters — whose arguments were paid for by the TEP for Tucson PAC — cite reliability as the reason to vote yes on the measure, several others who submitted arguments emphasized the Energy Collaboration Agreement investments as a reason to support the measure. 

“The Coalition for Sonoran Desert Protection supports the Energy Collaboration Agreement (ECA) and its annual investment in Tucson’s environmental initiatives. This agreement, which will be enabled by Proposition 421, is an opportunity to increase sustained, local investment in Tucson’s long-term conservation and climate strategies,” wrote Kate Hotten, co-executive director of the coalition. 

Ward 3 council member Kevin Dahl was more critical of TEP, but also submitted an argument urging voters to approve the measure. 

“Vote Yes for TEP Franchise, Despite TEP’s Shortcomings. It’s not wrong to be upset with Tucson Electric Power. The Canadian-owned company seeks skyhigh prices to generate guaranteed profits. Despite climate concerns, polluting fossil fuels are still its major energy source. TEP is regulated by Arizona Corporation Commissioners whose members act like utility cheerleaders rather than consumer watchdogs,” Dahl wrote. “But voting no to punish TEP, or to advocate for clean power, or to force the City to take over the utility, or to save money will not work. The Franchise is not about these things and there are other more appropriate battlegrounds for these issues.”

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