2016 -- S 2087 SUBSTITUTE B

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LC003224/SUB B

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS - DUTIES AND UTILITIES AND

CARRIERS

     Introduced By: Senators Miller, Sosnowski, Pichardo, Metts, and Goodwin

     Date Introduced: January 21, 2016

     Referred To: Senate Commerce

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 39-1-27.12 of the General Laws in Chapter 39-1 entitled "Public

Utilities Commission" is hereby amended to read as follows:

     39-1-27.12. Low Income Home Energy Assistance Program Enhancement Plan. --

(a) The Low Income Home Energy Assistance Program Enhancement Plan (hereinafter "LIHEAP

Enhancement Plan") is hereby created to supplement the federal Low Income Home Energy

Assistance Program ("LIHEAP") funding being received by customers of Rhode Island electric

and gas distribution companies.

      (b) Within a period of time sufficient to accomplish the purposes of this section, but not

longer than ninety (90) days after the effective date of this chapter, the department of human

services shall develop a recommended monthly "LIHEAP Enhancement Charge" rate for the

following year and make a filing with the commission pursuant to this chapter recommending

rates. Thereafter annually but no later than October 15 of each year, the department shall make

filings with the commission to recommend the LIHEAP Enhancement Charge rates for each class

of electric and natural gas distribution company customer for the following year.

      (c) A LIHEAP Enhancement Charge approved by the Commission shall have the

following limitations:

      (1) For electric distribution company customers, the charge shall not be more than ten

dollars ($10.00) per year.

      (2) For natural gas distribution company customers, the charge shall not be more than ten

dollars ($10.00) per year.

      (3) The total projected annual revenue for the LIHEAP Enhancement Plan through

charges to all electric and natural gas distribution company customers shall not exceed seven

million five hundred thousand dollars ($7,500,000) and shall not be below six million five

hundred thousand dollars ($6,500,000).

     A minimum of five percent (5%) shall be allocated to provide assistance to customers

who are seeking LIHEAP certification for the sole purpose of entering into an arrearage plan as

defined in §39-2-1(d)(2) between April 15 and September 30 of each year. Such customers must

be a homeless family or individual who is transitioning from a shelter into housing and provide

documentation acceptable to the department of human services. Any funds remaining at the end

of the fiscal year shall be available for the upcoming winter season.

      (d) The commission shall open a docket to consider for approval LIHEAP Enhancement

Charge rates proposed by the department. In reviewing the recommended rates the commission

shall give due consideration to the recommendations of the department and the standards set forth

in subsection (c) of this section. The commission shall issue a decision within sixty (60) days

after said recommendations and report are filed with the commission establishing the

Enhancement Plan Charge rates.

      (e) The electric or gas distribution company shall use the funds collected through this

Enhancement Plan Charge to provide a credit to customers accounts that are receiving federal

LIHEAP assistance payments in a manner determined by the department of human services. The

department of human services shall designate to the gas or electric distribution company the

qualifying customer accounts and the amounts to be credited to those customer accounts,

provided that the total amount to be credited to those accounts shall be fully funded by and not

exceed the total amount collected through the Enhancement Plan Charge. The electric or gas

distribution company's added administrative expenses to process the credit assignments provided

to it by the department of human services will be recoverable either from the LIHEAP

Enhancement Charge or through a separate charge approved by the Public Utilities Commission.

      (f) As used in this section, "electric and natural gas distribution company" means a

company as defined in subsection 39-1-2(12), but not including the Block Island Power Company

or the Pascoag Utility District.

     SECTION 2. Section 39-2-1 of the General Laws in Chapter 39-2 entitled "Duties of

Utilities and Carriers" is hereby amended to read as follows:

     39-2-1. Reasonable and adequate services -- Reasonable and just charges. -- (a)

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Every public utility is required to furnish safe, reasonable, and adequate services and facilities.

The rate, toll, or charge, or any joint rate made, exacted, demanded, or collected by any public

utility for the conveyance or transportation of any persons or property, including sewage, between

points within the state, or for any heat, light, water, or power produced, transmitted, distributed,

delivered, or furnished, or for any telephone or telegraph message conveyed or for any service

rendered or to be rendered in connection therewith, shall be reasonable and just, and every unjust

or unreasonable charge for the service is prohibited and declared unlawful, and no public utility

providing heat, light, water, or power produced, transmitted, distributed, delivered, or furnished

shall terminate the service or deprive any home or building, or whatsoever, of service if the

reason therefor is nonpayment of the service without first notifying the user of the service, or the

owner or owners of the building as recorded with the utility of the impending service termination

by written notice at least ten (10) days prior to the effective date of the proposed termination of

service.

      (1) Effective immediately, following the issuance of a decision by the commission under

39-1-27.2(d), the utility shall collect a LIHEAP Enhancement Chargefunds from all utility

customers, for the funding of the LIHEAP Enhancement Fund.

      (b) Any existing rules and regulations dealing with the termination of utility service and

establishing reasonable methods of debt collection promulgated by the commission pursuant to

this chapter and the provisions of § 39-1.1-3, including but not limited to, any rules and

regulations dealing with deposit and deferred payment arrangements, winter moratorium and

medical emergency protections, and customer dispute resolution procedures, shall be applicable

to any public utility which distributes electricity.

      (c) The commission shall promulgate such further rules and regulations as are necessary

to protect consumers following the introduction of competition in the electric industry and which

are consistent with this chapter and the provisions of § 39-1.1-3. In promulgating such rules and

regulations, the commission shall confer with the Retail Electric Licensing Commission and shall

give reasonable consideration to any and all recommendations of the Retail Electric Licensing

Commission.

      (d)(1) On or before May 1, 2007, the commission shall administer such rules and

regulations as may be necessary to implement the purpose of subdivision (1) of this section and to

provide for restoration of electric and/or gas service to very low income households as defined by

§ 42-141-2. On or before August 15, 2011, the commission shall administer such rules and

regulations, as may be necessary, to implement the purpose of subdivision (2) of this section and

to provide for the restoration of electric and/or gas service to LIHEAP-eligible households,

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defined as those with a combined gross income equal to or less than sixty percent (60%) of the

state median household income as calculated by the U.S. Bureau of Census and as adjusted for

family or group size by the U.S. Department of Health and Human Services regulation 45 CFR

Sec. 96.85 or its successor regulation.

      (1) Effective July 1, 2007 until October 14, 2011, notwithstanding the provisions of part

V sections 4(E)(1)(B) and (C) of the public utilities commission rules and regulations governing

the termination of residential electric, gas, and water utility service, a very low income customer

who is terminated from gas and/or electric service or is recognized pursuant to a rule or decision

by the division as being scheduled for actual shut-off of service on a date specified, shall be

eligible one time to have electric and/or gas utility service restored providing the following

conditions are met:

      (i) The customer pays twenty-five percent (25%) of the customer's unpaid balance;

      (ii) The customer agrees to pay one thirty-sixth (1/36) of one half (1/2) of the customer's

remaining balance per month for thirty-six (36) months;

      (iii) The customer agrees to remain current with payments for current usage. For

purposes of this subsection remaining current with payments shall mean that the customer: (a)

misses no more than a total of three (3) payments in the thirty-six (36) month period covered by

the agreement; (b) misses more than two (2) payments in any one calendar year, provided that

such missed payments in a calendar year are not consecutive and that payments for the year are

up-to-date by October 31st; and (c) that the amount due under that agreement is paid in full by the

conclusion of the period of the agreement;

      (iv) The customer has shown, to the satisfaction of the division, that the customer is

reasonably capable of meeting the payment schedule provided for by the provisions of

subdivision 39-2-1(d)(1)(i) and (ii) in this section. The restoration of service provided for by this

subsection shall be a one-time right; failure to comply with the payment provisions set forth in

this subsection shall be grounds for the customer to be dropped from the repayment program

established by this subsection, and the balance due on the unpaid balance shall be due in full and

shall be payable in accordance with the rules of the commission governing the termination of

residential electric, gas, and water utility service. A customer who completes the schedule of

payments pursuant to this subsection, shall have the balance of any arrearage forgiven, and the

customer's obligation to the gas and/or electric company for such balance shall be deemed to be

fully satisfied. The amount of the arrearage so forgiven shall be treated as bad debt for purposes

of cost recovery by the gas or the electric company.

      (2) Effective October 15, 2011 no later than September 1, 2016, notwithstanding the

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provisions of part V sections 4(E)(1)(B) and (C) of the public utilities commission rules and

regulations governing the termination of residential electric, gas, and water utility service, a

LIHEAP-eligible customer, as defined above in this section, who has been terminated from gas

and/or electric service or is recognized, pursuant to a rule or decision by the division, as being

scheduled for actual shut-off of service on a specific date, shall not be deprived electric and/or

gas utility service provided the following conditions are met:

      (i) The customer makes an initial payment of ten percent (10%) of the customer's unpaid

balance; and

      (ii) The customer agrees to pay an amount equal to one-thirty sixth (1/36) of forty

percent (40%) of the customer's unpaid balance, per month for thirty-six (36) months; and

      (iii) The customer agrees to remain current with payments for current usage. For

purposes of this subsection, remaining current with payments, shall mean that the customer: (A)

Misses no more than a total of three (3) payments in the thirty-six (36) month period covered by

the agreement; (B) Misses more than two (2) payments in any one calendar year, provided that

such missed payments in a calendar year are not consecutive and that payments for the year are

up-to date by October 31st; and (C) That the amount due under that agreement is paid in full, by

the conclusion of the period of the agreement; and

      (iv) The customer has shown, to the satisfaction of the division, that the customer is

reasonably capable of meeting the payment schedule, provided for by the provisions of

subdivision 39-2-1(d)(1)(i) and (ii) in this section. The restoration of service, provided for by this

subsection, shall be a one-time right; failure to comply with the payment provisions set forth in

this subsection shall be grounds for the customer to be removed from the repayment program

established by this subsection and the balance due on the unpaid balance, shall be due and

payable in full, in accordance with the rules of the commission governing the termination of

residential electric, gas, and water utility service. A customer, who completes the schedule of

payments, pursuant to this subsection, shall have the balance of any arrearage forgiven, and the

customer's obligation to the gas and/or electric company for such unpaid balance shall be deemed

to be fully satisfied. The amount of the arrearage, so forgiven, shall be treated as bad debt for

purposes of cost recovery by the gas or the electric company.

     (i) The customer has an account balance of at least three hundred dollars ($300) that is

more than sixty (60) days past due;

     (ii) The customer is eligible for the federal low-income home energy assistance program

and the account is enrolled in the utility low-income rate if offered;

     (iii) If utility service has been terminated the customer shall make an initial payment of

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twenty-five percent (25%) of the unpaid balance, unless the commission has enacted emergency

regulations in which case the customer shall pay the down payment required by the emergency

regulations;

     (iv) The customer agrees to participate in energy efficiency programs;

     (v) The customer applies for other available energy assistance programs, including fuel

assistance and weatherization;

     (vi) The customer agrees to make at least twelve (12) monthly payments in an amount

determined by the utility and based on the customer's average monthly usage of the previous year,

and the customer's actual or anticipated fuel assistance, if known. The electric and/or gas utility

company shall review the payment plan every three (3) months and may adjust said plan based on

the following: the amount of or change in fuel assistance; the customer moves, actual usage

differs from estimated usage; and/or significant changes in the company’s energy costs or rates

from the time of anticipated enrollment;

     (vii) With each payment, a portion of the customer's outstanding account balance shall be

forgiven in an amount equal to the total past-due balance divided by the number of months in the

customer agreement;

     (viii) Up to one thousand five hundred dollars ($1,500) shall be forgiven in a twelve (12)

month period. If the outstanding account balance is greater than one thousand five hundred

dollars ($1,500), the length of the agreement may, at the request of the customer, be extended for

more than twelve (12) months to accommodate the total outstanding balance, provided that the

customer is current with payments at the conclusion of the previous twelve (12) month period;

     (ix) The customer agrees to remain current with payments. For purposes of this

subsection, remaining current shall mean that the customer: (A) Misses no more than two (2)

payments in a twelve (12) month period covered by the agreement; and (B) That the amount due

under the agreement is paid in full, by the conclusion of the twelve (12) month period of the

agreement;

     (x) Failure to comply with the payment provisions set forth in this subsection shall be

grounds for the customer to be removed from the repayment program established by this

subsection and the balance due on the unpaid balance, shall be due and payable in full, in

accordance with the rules of the commission governing the termination of residential electric, gas,

and water utility service, provided, that any arrearage already forgiven under subsection (d)(2)(ii)

of this section shall remain forgiven and be written off by the utility. The amount of the arrearage,

so forgiven, shall be recovered by the electric and/or gas company through an annual reconciling

factor approved by the commission;

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     (xi) The commission may promulgate rules and regulations to implement this section that

ensures efficient administration of the program in a non-discriminatory manner consistent with

the goal of providing assistance to customers who are willing and able to meet their obligations to

the utility under this program;

     (xii) Each public utility that provides gas or electric service to residential ratepayers shall

file tariffs implementing the requirements of this section on a date to be determined by the

commission which shall allow for the program to be in place no later than October 1, 2016; and

     (xiii) After two (2) years from the date of completion of the plan or removal from the

plan for failure to remain current with payments and upon recommendation from a community

action partnership agency, a customer shall be eligible to enroll in a subsequent arrearage

forgiveness plan.

     (xiv) A customer, who completes the schedule of payments, pursuant to this subsection,

shall have the balance of any arrearage forgiven, and the customer's obligation to the gas and/or

electric company for such unpaid balance shall be deemed to be fully satisfied. The amount of the

arrearage, so forgiven, shall be treated as bad debt for purposes of cost recovery by the gas or the

electric company up to the amount allowed in the gas and/or electric company's most recent

general rate filing. In the event the gas or electric company's bad debt for a calendar year exceeds

the amount allowed in the most recent general rate filing for the same period, the gas or electric

company shall be entitled to recovery of those write-offs that were the result of the arrearage

forgiveness plan set forth in this section.

      (3) A customer terminated from service under the provisions of subdivision 39-2-1(d)(1)

or subdivision 39-2-1(d)(2) shall be eligible for restoration of service in accordance with the

applicable provisions of part V section 4(E)(1)(C), or its successor provision, of the public

utilities commission rules and regulations governing the termination of residential electric, gas,

and water service.

     (e) The commission shall complete a comprehensive review of all utility and energy

related programs and policies impacting protected classes and low-income ratepayers. In

conducting its review, the commission shall consult with the division, the attorney general, the

utility, the department of human services, the ratepayers advisory board established by §39-1-

37.1, community based organizations, a homeless advisory group, and community action

agencies, each of whom shall cooperate with meetings scheduled by the commission and any

requests for information received by the commission by providing responses within twenty-one

(21) days from issuance. The commission shall submit a report of its findings and

recommendations to the governor and the general assembly no later than November 1, 2018. No

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later than November 15, 2017, and annually thereafter, the commission shall submit to the

governor, the senate president and the speaker of the house a report on the effectiveness of the

customer arrearage program which shall include a cost benefit analysis and recommendations to

improve effectiveness of the arrearage program.

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS - DUTIES AND UTILITIES AND

CARRIERS

***

     This act would authorize the department of human services to use low-income energy

assistance funds throughout the calendar year, establish an arrearage program and require the

PUC to conduct a review of programs impacting low-income ratepayers.

     This act would take effect upon passage.

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