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PRINTER'S NO. 1765
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1405
Session of
2017
INTRODUCED BY BERNSTINE, SNYDER, SAYLOR, SIMS, CHRISTIANA, DUSH,
GABLER, METCALFE, PHILLIPS-HILL, ROAE, RYAN, SACCONE, SANKEY,
WALSH, WARD, WHEELAND, FITZGERALD, RABB, SOLOMON, BLOOM,
CEPHAS, CHARLTON, COOK, COX, BAKER, CUTLER, DAWKINS, DIAMOND,
DiGIROLAMO, DOWLING, DUNBAR, ELLIS, ENGLISH, EVANKOVICH,
EVERETT, FRITZ, GILLESPIE, GROVE, A. HARRIS, HENNESSEY, HILL-
EVANS, IRVIN, KAUFER, KEEFER, M. K. KELLER, KULIK, LAWRENCE,
LEWIS, MAHER, MAKO, MARSICO, McCLINTON, McGINNIS, MICCARELLI,
MILLARD, MILNE, MOUL, MUSTIO, ORTITAY, PICKETT, PYLE, RADER,
ROE, ROTHMAN, SCHLOSSBERG, SIMMONS, STEPHENS, TALLMAN,
TOOHIL, TOPPER, WARNER, WARREN, WHITE, D. COSTA, NELSON AND
SAMUELSON, MAY 18, 2017
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, MAY 18, 2017
AN ACT
Amending Title 8 (Boroughs and Incorporated Towns) of the
Pennsylvania Consolidated Statutes, in manufacture and supply
of electricity, further providing for specific powers and
providing for security deposits, for payment agreements and
for restrictions on termination.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 24A03(a)(2) of Title 8 of the
Pennsylvania Consolidated Statutes is amended to read:
§ 24A03. Specific powers.
(a) Specific powers enumerated.--In addition to exercising
its general powers under section 24A02 (relating to general
powers), a borough, through its governing body, shall have the
following powers:
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* * *
(2) To regulate the use of and the charge for
electricity furnished by the borough for use throughout the
borough[.], subject to the following:
(i) A borough may fix, establish, maintain and
collect or authorize by contract or otherwise the
establishment, levying and collection of the rates, fees,
rental or other charges, including connection charges,
[for the services afforded by or in connection with any
properties which the borough constructs, erects, owns,
acquires, operates or manages and for the sale or
transmission of electric energy and power as it deems
necessary, proper, desirable and reasonable.] in the area
served by borough facilities at reasonable and uniform
rates to be determined exclusively by the borough for the
purpose of providing for the payment of the expenses of
the borough for the production and distribution of
electricity and the construction, improvement, repair,
maintenance and operation of the borough's facilities and
properties.
(ii) A person questioning the reasonableness or
uniformity of a rate fixed by a borough or the adequacy,
safety and reasonableness of the borough's services,
including extensions thereof, may bring suit against the
borough in the court of common pleas of the county where
the project is located or, if the project is located in
more than one county, in the court of common pleas of the
county where the principal office of the project is
located. The court of common pleas shall have exclusive
jurisdiction to determine disputes involving rates or
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services under this paragraph.
(iii) A rate change under this paragraph shall be
discussed at a publicly advertised meeting of the borough
council prior to adoption of the rate change. A borough
may not adjust the rates more than once every three
months.
(iv) A borough may include a purchase power
agreement formula in the calculation of the rates to
adjust for the changing cost of the production of
electricity. The purchase power agreement shall be
published with the rate information.
(v) A borough that generates its own electricity in
accordance with the guidelines and regulations
promulgated by the Pennsylvania-New Jersey-Maryland
Interconnection shall have the power, and is not subject
to subparagraphs (i), (ii), (iii) and (iv), to regulate
the use of and the charge for electricity furnished by
the borough for use throughout the borough. A borough may
fix, establish, maintain and collect or authorize by
contract or otherwise the establishment, levying and
collection of the rates, fees, rental or other charges,
including connection charges, for the services afforded
by or in connection with any property that the borough
constructs, erects, owns, acquires, operates or manages
and for the sale or transmission of electric energy and
power as the borough deems necessary, proper, desirable
and reasonable.
* * *
Section 2. Title 8 is amended by adding sections to read:
§ 24A06. Security deposits.
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(a) General rule.--If a borough electric provider requires a
security deposit, the security deposit shall be payable during a
90-day period, in an amount that is equal to one-sixth of the
applicant's estimated annual bill, from the following:
(1) An applicant who previously received utility
distribution services and was a customer of the borough and
whose service was terminated for any of the following
reasons:
(i) Nonpayment of an undisputed delinquent account.
(ii) Failure to complete payment of a deposit,
provide a guarantee or establish credit.
(iii) Failure to permit access to meters, service
connections or other property of the borough for the
purpose of replacement, maintenance, repair or meter
reading.
(iv) Unauthorized use of the utility service
delivered on or about the affected dwelling.
(v) Failure to comply with the material terms of a
settlement or payment arrangement.
(vi) Fraud or material misrepresentation of identity
for the purpose of obtaining utility service.
(vii) Tampering with a meter, including, but not
limited to, bypassing a meter or removal of an automatic
meter reading device or other borough equipment.
(2) An applicant or customer who is unable to establish
creditworthiness to the satisfaction of the borough through
the use of a generally accepted credit scoring methodology
that employs standards for using the methodology that fall
within the range of general industry practice.
(3) A customer who fails to comply with a material term
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or condition of a settlement or payment arrangement.
(b) Cash deposit prohibition.--Notwithstanding subsection
(a), no borough may require a customer or applicant that is
confirmed to be eligible for a customer assistance program to
provide a cash deposit.
(c) Third-party guarantor.--Nothing in this section shall be
construed to preclude an applicant from furnishing a third-party
guarantor in lieu of a cash deposit. The guaranty shall be in
writing and shall state the terms of the guaranty. The guarantor
shall be responsible for all missed payments owed to the
borough.
(d) Deposit hold period.--
(1) A borough may hold a deposit until a timely payment
history is established.
(2) A timely payment history is established when a
customer has paid in full and on time for 12 consecutive
months.
(3) At the end of the deposit holding period as
established in paragraph (1), the borough shall deduct the
outstanding balance from the deposit and return or credit any
positive difference to the customer.
(4) If service is terminated before the end of the
deposit holding period as established in paragraph (1), the
borough shall deduct the outstanding balance from the deposit
and return any positive difference to the customer within 60
days of the termination.
(5) If a customer becomes delinquent before the end of
the deposit holding period as established in paragraph (1),
the borough may deduct the outstanding balance from the
deposit.
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(6) The borough shall accrue interest on the deposit
until it is returned or credited as follows:
(i) Interest shall be computed at the simple annual
interest rate determined by the Secretary of Revenue for
interest on the underpayment of tax under section 806 of
the act of April 9, 1929 (P.L.343, No.176), known as The
Fiscal Code.
(ii) The interest rate in effect when deposit is
required to be paid shall remain in effect until the
later of:
(A) the date the deposit is refunded or
credited; or
(B) December 31.
(iii) On January 1 of each year, the new interest
rate for that year shall apply to the deposit.
(e) Adult occupants.--Prior to providing utility service, a
borough may require the applicant to provide the names of each
adult occupant residing at the location and proof of their
identity.
(f) Failure to pay full amount of cash deposit.--A borough
shall not be required to provide service if the applicant or
customer fails to pay the full amount of the cash deposit within
the time period under subsection (a).
(g) Estimated annual bill.--For purposes of this section, an
estimated annual bill shall be calculated on the basis of the
annual bill to the dwelling at which service is requested for
the prior 12 months or, if unavailable, a similar dwelling in
close proximity.
(h) Time for paying deposits upon reconnection.--Applicants
and customers required to pay a deposit upon reconnection under
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subsection (a)(1) shall have up to 90 days to pay the deposit.
§ 24A07. Payment agreements.
(a) General rule.--A borough may enter into a payment
agreement with a delinquent customer.
(b) Length of payment arrangement.--The length of time for a
customer to resolve an unpaid balance on an account that is
subject to a payment arrangement between the borough and the
customer may not extend beyond:
(1) Five years, if the customer has a gross monthly
household income level not exceeding 150% of the Federal
poverty level.
(2) Three years, if the customer has a gross monthly
household income level exceeding 150% and not more than 250%
of the Federal poverty level.
(3) One year, if the customer has a gross monthly
household income level exceeding 250% of the Federal poverty
level and not more than 300% of the Federal poverty level.
(4) Six months, if the customer has a gross monthly
household income level exceeding 300% of the Federal poverty
level.
(c) Customer assistance programs.--Customer assistance
program rates shall be timely paid and shall not be the subject
of payment arrangements negotiated or approved by the borough.
(d) Number of payment arrangements.--Absent a change in
income, the borough shall not be required to establish a second
or subsequent payment arrangement if the customer has defaulted
on a previous payment arrangement with the borough. The borough
may, at its discretion, enter into a second or subsequent
payment arrangement with the customer.
(e) Extension of payment arrangement.--If the customer
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defaults on a payment arrangement established under subsections
(a) and (b) as a result of a significant change in circumstance,
the borough may reinstate the payment arrangement and extend the
remaining term for an initial period of six months. The initial
extension period may be extended for an additional six months
for good cause shown.
(f) Failure to comply with payment arrangement.--Failure of
a customer to comply with the terms of a payment arrangement
shall be grounds for the borough to terminate the customer's
service. The customer shall pay that portion of the bill that is
not in dispute and subsequent bills that are not in dispute.
§ 24A08. Restrictions on termination.
(a) Winter termination.--
(1) (i) After November 30 and before April 1, a borough
electric provider may not terminate service to customers
with household incomes at or below 250% of the Federal
poverty level except for customers whose actions conform
to subsection (c)(1).
(ii) The borough may terminate service in accordance
with this section to customers with household incomes
exceeding 250% of the Federal poverty level.
(2) In addition to the winter termination authority
specified in paragraph (1), the borough may terminate service
to a customer whose household income exceeds 150% of the
Federal poverty level but does not exceed 250% of the Federal
poverty level and, starting January 1, has not paid at least
50% of the charges for each of the prior two months unless
the customer has done one of the following:
(i) proven that the customer's household contains
one or more persons who are 65 years of age or older;
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(ii) proven that the customer's household contains
one or more persons 12 years of age or younger; or
(iii) paid to the borough an amount representing at
least 15% of the customer's monthly household income for
each of the last two months.
(b) Medical certification.--A borough may not terminate
service to a premises when a customer has submitted a medical
certificate to the borough. The customer must obtain a medical
certificate verifying the condition and promptly forward the
certificate to the borough.
(c) Grounds for immediate termination.--
(1) The borough may immediately terminate service for
any of the following actions by the customer:
(i) Unauthorized use of the service delivered on or
about the affected dwelling.
(ii) Fraud or material misrepresentation of the
customer's identity for the purpose of obtaining service.
(iii) Tampering with a meter or other equipment of a
public utility.
(iv) Tendering payment for reconnection of service
that is subsequently dishonored, revoked or canceled and
has not been cured or otherwise paid in full, within
three business days of the borough's notice to the
customer, in accordance with the notice of the dishonored
payment.
(2) Upon termination, the borough shall make a good
faith attempt to provide a post-termination notice to the
customer or a responsible person at the affected premises
and, in the case of a single-meter, multiunit dwelling, the
borough shall conspicuously post the notice at the dwelling,
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including in common areas when possible.
Section 3. This act shall take effect in 60 days.
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