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Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20170&cosponId=26194
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House of Representatives
Session of 2017 - 2018 Regular Session

MEMORANDUM

Posted: August 1, 2018 02:39 PM
From: Representative Aaron D. Kaufer
To: All House members
Subject: Consumer Protection for Previously Unbilled Services
 
Soon I will be introducing legislation to limit the amount of time that a utility can issue a customer a make-up bill for previously unbilled usage or back bill for service. Additionally, my bill will require long term payment plans for budget billing customers when a utility’s failure to make proper quarterly adjustments results in a large close out balance.

Budget billing is a program offered by public utilities that spreads payment for a customer’s energy costs evenly over 12 months. The monthly amount paid by customers represents an average of their 12-month usage, subject to quarterly adjustments. At the end of the 12-month budget billing period the customer’s account is trued up or closed out for the period. Under current practice, if the amount paid by the customer is less than the actual amount due for service, then the customer pays the difference in 3 monthly installments. If the customer uses less service than they paid for under budget billing, a bill credit is provided. Ideally, the difference between the amount paid by the customer during the 12- month period and the actual amount due for usage will be zero. Many consumers find budget billing to be an effective tool to manage seasonal fluctuations in energy usage. However, the success of budget billing depends on periodic adjustment of the monthly budget billing amount paid by customers.

In my district, many constituents who participate in budget billing with their utility company discovered large discrepancies between the amount they paid over the year and the actual amount due for their usage. The only explanation for so many consumers getting hit with large close out balances is that the utility failed to properly implement quarterly adjustments. In this case, the utility is providing impacted customers with 12- months to pay their close out balances. It is unacceptable for customers to face high bills and financial hardship to pay them due to the company’s negligence.

My bill will require a 36-month payment plan whenever a utility’s failure to properly adjust the monthly payments required of budget billing customers results in a close out balance of $300 or more. This will enable customers to make small payments on the balance that accrued due to the utility’s failure and mitigate any financial impact that being surprised with a large account balance would cause a customer.

My bill also limits the amount of time that a bill for previously unbilled service or a back bill can be issued when a customer played no role in the utility’s failure to properly issue a bill or bill a customer at the correct rate.