HOUSE BILL No. 5996 July 2, 1998, Introduced by Reps. Thomas, Olshove, Schauer and LaForge and referred to the Committee on Public Utilities. A bill to provide certain protections for low-income and senior citizen electric customers; to prescribe the powers and duties of certain state agencies and officials; and to prescribe penalties and civil sanctions and provide remedies. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 1. As used in this act: 2 (a) "Administrative procedures act of 1969" means the admin- 3 istrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 4 24.328. 5 (b) "Aggregator" means a person who combines electric loads 6 of multiple retail customers or a single customer with multiple 7 sites to facilitate the provision of direct access electric serv- 8 ice to such retail customers. 9 (c) "Commission" means the Michigan public service 10 commission in the department of consumer and industry services. 06057'98 SAT 2 1 (d) "Consumer" or "customer" means an end-user of 2 electricity. 3 (e) "Contested case" means that term as defined in section 3 4 of the administrative procedures act of 1969, MCL 24.203. 5 (f) "Electricity distributor" or "distributor" means a 6 person or his or her lessees, trustees, and receivers, owning or 7 operating equipment or facilities for delivering electricity to 8 the public for compensation. 9 (g) "Electricity supplier" or "supplier" means a person who 10 sells electricity and related services to electricity distribu- 11 tors, aggregators, or at retail to customers located in the serv- 12 ice territories of electricity distributors. 13 (h) "Eligible customer" means either an eligible low-income 14 customer or an eligible senior citizen customer. 15 (i) "Eligible low-income customer" means a supplier customer 16 whose household income does not exceed 150% of the poverty level, 17 as published by the United States department of health and human 18 services, or who receives any of the following: 19 (i) Assistance from a state emergency relief program 20 (ii) Food stamps. 21 (iii) Medicaid. 22 (j) "Eligible senior citizen customer" means a utility cus- 23 tomer who is 65 years of age or older and who advises the utility 24 of his or her eligibility. 25 (k) "Person" means an individual, partnership, corporation, 26 association, governmental entity, or other legal entity. 06057'98 3 1 Sec. 2. (1) The commission shall establish a program to 2 support continued utility service to low-income consumers. 3 (2) After a contested case, the commission shall establish a 4 charge under this act to be assessed to all customers on a 5 per-kilowatt-hour basis within a distributor's service area. In 6 determining the amount of the charge, the commission shall take 7 into account the availability of other funding and the specific 8 needs of low-income customers in the distributor's service area. 9 (3) Programs under this section shall include, but are not 10 limited to, payment assistance, weatherization, energy conserva- 11 tion, and customer education. 12 (4) The charges collected under this section for 1 distribu- 13 tor shall not be used for programs of another distributor. 14 Except as otherwise approved by the commission, any program 15 offered on the effective date of this act shall continue at a 16 level not less than that offered on that date. 17 Sec. 3. (1) An electricity supplier shall not shut off 18 service to an eligible customer during the heating season for 19 nonpayment of a delinquent account if the customer is an eligible 20 senior citizen customer or if the customer pays to the supplier a 21 monthly amount equal to 7% of the estimated annual bill for the 22 eligible customer and the eligible customer demonstrates, within 23 14 days of requesting shutoff protection, that he or she has 24 applied for state or federal heating assistance. If an arrearage 25 exists at the time an eligible customer applies for protection 26 from shutoff of service during the heating season, the supplier 27 shall permit the customer to pay the arrearage in equal monthly 06057'98 4 1 installments between the date of application and the start of the 2 subsequent space heating season. 3 (2) A supplier may shut off service to an eligible 4 low-income customer who does not pay the monthly amounts referred 5 to in subsection (1) after giving notice in the manner required 6 by rules. The supplier is not required to offer a settlement 7 agreement to an eligible low-income customer who fails to make 8 the monthly payments referred to in subsection (1). 9 (3) If a customer fails to comply with the terms and condi- 10 tions of this part, a supplier may shut off service after giving 11 the customer a notice, by personal service or first-class mail, 12 that contains all of the following information: 13 (a) That the customer has defaulted on the winter protection 14 plan. 15 (b) The nature of the default. 16 (c) That unless the customer makes the payments that are 17 past due under this part within 10 days of the date of mailing, 18 the supplier may shut off service. 19 (d) The date on or after which the supplier may shut off 20 service, unless the customer takes appropriate action. 21 (e) That the customer has the right to file a complaint dis- 22 puting the claim of the supplier before the date of the proposed 23 shutoff of service. 24 (f) That the customer has the right to request a hearing 25 before a supplier hearing officer if the complaint cannot be oth- 26 erwise resolved and that the customer must pay to the supplier 06057'98 5 1 that portion of the bill that is not in dispute within 3 days of 2 the date that the customer requests a hearing. 3 (g) That the customer has the right to represent himself or 4 herself, to be represented by counsel, or to be assisted by other 5 persons of his or her choice in the complaint process. 6 (h) That the supplier will not shut off service pending the 7 resolution of a complaint that is filed with the utility in 8 accordance with this part. 9 (i) The telephone number and address of the supplier where 10 the customer may make inquiry, enter into a settlement agreement, 11 or file a complaint. 12 (j) That the customer should contact a social services 13 agency immediately if the customer believes he or she might be 14 eligible for emergency economic assistance. 15 (k) That the supplier will postpone shutoff of service if a 16 medical emergency exists at the customer's residence. 17 (l) That the supplier may require a deposit and restoration 18 charge if the supplier shuts off service for nonpayment of a 19 delinquent account. 20 Sec. 4. (1) At the conclusion of the heating season, the 21 supplier shall reconcile the accounts of eligible customers and 22 permit customers to pay any amounts owing in equal monthly 23 installments between April 1 and December 1. A supplier may shut 24 off service to eligible customers who fail to make installment 25 payments on a timely basis in the manner required by this part. 26 (2) At the option of the customer, between April 1 and 27 November 30, the customer may choose to pay 9% of the estimated 06057'98 6 1 annual bill each month together with the monthly installment for 2 any preenrollment arrearage instead of the amount otherwise owing 3 for actual and reconciled past due amounts. 4 (3) After November 30, the supplier shall reconcile the 5 account of any customer who has chosen and fulfilled the obliga- 6 tions of the 9% option by refunding any net overcollection or 7 adding any net undercollection to the customer's arrearage for 8 the upcoming heating season. 9 (4) If a customer fails to make all payments that are 10 required under the 9% option, the supplier may immediately recon- 11 cile his or her account by refunding any net overcollection or by 12 adding any net undercollection to the customer's current bill. 13 Sec. 5. (1) A supplier shall not require an eligible 14 low-income customer whose service has been shut off before apply- 15 ing for protection under this part to pay a fee for restoring 16 service or a security deposit under the provisions of R 460.2132 17 of the Michigan administrative code during the heating season. 18 (2) A supplier may not require an amount greater than 1/12 19 of an arrearage owing in order to restore service or initiate 20 participation in the winter protection plan. The 7% payment 21 shall be billed according to normal billing procedures for the 22 supplier. 23 Sec. 6. (1) An eligible low-income customer may preenroll 24 in the winter protection plan between November 15 and November 30 25 by paying the current usage plus 1/12 of any arrearage and agree- 26 ing to the terms of the winter protection plan for the upcoming 27 heating season. 06057'98 7 1 (2) An eligible senior citizen customer may preenroll by 2 advising the supplier of his or her eligibility. A preenrolled 3 customer shall not have his or her service terminated before the 4 commencement of the winter protection plan. 5 (3) A customer whose service is off as of November 15 shall 6 be eligible to preenroll in the winter protection plan and have 7 service restored immediately after fulfilling the requirements 8 for preenrollment. Further, an off service low-income customer 9 who applies during the preenrollment period shall be entitled to 10 have all deposits and reconnection fees waived. 11 Sec. 7. If after notice and hearing the commission finds a 12 person has violated this act, the commission shall order remedies 13 and penalties to protect and make whole any persons who have suf- 14 fered an economic loss as a result of the violation, including, 15 but not limited to, 1 or more of the following: 16 (a) The person to pay a fine for the first offense of not 17 less than $1,000.00 nor more than $20,000.00 per day that the 18 person is in violation of this act, and for each subsequent 19 offense, a fine of not less than $2,000.00 nor more than 20 $40,000.00 per day. 21 (b) A refund to the customers of any collected excessive 22 rates. 23 (c) Cease and desist orders. 24 (d) If the person is certified or registered under this or 25 any other act, revoke the person's certificate or registration. 06057'98 Final page. SAT