Tucson Will Vote on 25-Year Utility Franchise Deal
Local businesses must weigh the impact of a proposed 2.25% fee on utility bills ahead of the November 2026 election.
Updated on Oct. 13, 2026 in Utilities
Live Poll
Should the city approve a 25-year franchise agreement with the local electric utility?
Tucson voters will decide this November 2026 whether to approve a new 25-year franchise agreement with Tucson Electric Power. The proposed deal establishes terms for infrastructure maintenance and utility operations within public rights-of-way.
Why it matters
The outcome will determine the long-term cost and operational framework for electrical infrastructure in the city. Businesses are monitoring the proposal's potential 14% increase in residential rates and the inclusion of a 2.25% franchise fee.
The proposed deal includes a 2.25% franchise fee and a $64 million total sustainability investment over 25 years. This follows a 2023 voter rejection of a previous renewal attempt and ongoing debates regarding corporate profit margins.
The players
Tucson Electric Power
The local electric utility provider responsible for infrastructure and energy delivery in Tucson.
Fortis Inc
The Canada-based parent company of Tucson Electric Power that reported $1.2 billion in 2025 earnings.
Tucson City Council
The municipal governing body overseeing the local franchise agreement process.
Arizona Corporation Commission
The state regulatory agency responsible for utility rate and operating oversight.
The details
The franchise agreement grants the utility the right to build and operate electric transmission on public rights-of-way. If voters reject the proposal, the utility would be required to secure individual permits for all future work in these areas. Supporters of the deal highlight the inclusion of annual sustainability investments, while opponents point to concerns over rising electricity rates.
Timeline
2000: Original 25-year franchise agreement began.
2023: Voters rejected a proposed franchise renewal.
December 2025: Arizona Corporation Commission approved the Project Blue power agreement.
September 22, 2026: Tucson City Council meeting regarding Proposition 421.
November 2026: Voters decide on Proposition 421.
Market Landscape
This vote marks a significant attempt to establish a long-term utility framework following the rejection of a similar proposal in 2023. The situation reflects broader tensions regarding utility-to-city infrastructure rights and the balancing of sustainability investments with ratepayer costs.
Business owners should review how potential rate increases could affect their monthly overhead. Monitoring the November 2026 ballot outcome is essential for planning long-term energy budgeting and operational expenses.
The takeaway
The franchise vote will dictate the regulatory environment for electric utility infrastructure in the city for the next quarter-century. Operators should analyze their current energy contracts and factor potential rate adjustments into their 2027 fiscal projections.
Further reading
For more on how local regulatory changes affect energy costs, review our guide to Utilities.
Live Poll
Should the city approve a 25-year franchise agreement with the local electric utility?
