Public Service Commission (PSC)
PSC Issues Order Temporarily Altering Public Utility Tariffs During COVID-19 Public Health Emergency (PDF) On March 24 the PSC issued an Emergency Order in Docket 5-UI-120 prohibiting a public utility from (i) assessing late fees upon any customer, regardless of customer class, for an arrearage incurred during the period covered by the emergency order; (ii) disconnecting or refusing service to any customer in any class for any reason other than to prevent a dangerous condition; (ii) refusing or delaying service to any customer in any class for failure to provide required identification documentation; and (iv) requiring a cash deposit or other guarantee as a condition of new service. The order also requires every public utility to offer a deferred payment agreement to any customer, regardless of customer class, if the customer is unable to pay a bill in full, for the period beginning with the effective date of the emergency order. (Because of statutory limitations, the PSC cannot require a municipal utility to offer a deferred payment agreement to a customer who is a tenant at a rental dwelling unit, but utilities are encouraged to do so.)
PSC COVID-19 FAQs Relating to the Emergency Order
Q: How should a utility respond to a customer that informs the utility they’ve decided to defer the payment of their bills? How should a utility handle non-payment by a large customer (industrial)?
A: The Order associated with Docket 5-UI-120 is not a directive for customers to stop paying their bills. Customers who are able to pay their bills should continue paying them during the public health emergency. Customers who do not pay their bills may be subject to disconnection and late payment charges when the public health emergency is lifted. In addition, the Order provides for a utility to submit a request to the Commission to disconnect a customer during the public health emergency.
Also, The federal Coronavirus Aid, Relief, and Economic Security (CARES) Act that was signed into law Friday, March 27, 2020 includes a Paycheck Protection Program that may provide some assistance – in the form of a forgivable loan -- to certain businesses to pay utility bills and other eligible expenses incurred during a portion of this emergency period. This program is described more below. If you have a commercial or industrial customer that may have difficulty paying their utility bill, you may want to discuss this program with them. It may be beneficial for them to pay their utility bill now with funds obtained through a forgivable loan than to defer payment of their bills to a later date.
Title I of the CARES Act creates the Paycheck Protection Program and provides for loan forgiveness under certain conditions.
- The Paycheck Protection Program provides for a new loan within the Small Business Administration’s 7(a) loan program for eligible small businesses.
- For purposes of the Paycheck Protection Program, the small business must employ less than 500 employees.
- This 500-employee threshold applies to the overall business; however, businesses in the accommodations and food services industries that have more than one physical location may be eligible for relief per location if the location employs less than 500 employees.
- The loans will be 100% guaranteed by the Small Business Administration and have an interest rate no higher than 4%.
- Eligible small businesses can use the loan to cover:
- Payroll costs
- Costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums
- Employee salaries, commissions, or similar compensations
- Payments of interest on any mortgage obligation
- Interest on any other debt obligations that were incurred before the covered period (i.e., February 15, 2020)
- The maximum loan amount will be the lesser of $10 million or 2.5 times the average monthly payroll based on the prior year’s payroll.
- Eligible small businesses applying for a loan under the program must make a good faith certification that the uncertainty of current economic conditions makes necessary the loan request to support the ongoing operations of the small business requesting assistance, among other things.
- A small businesses that maintains payroll continuity from February 15, 2020, through June 30, 2020, may request loan forgiveness on the Paycheck Protection loan.
- The amount of loan forgiveness is limited to an amount equal to the sum of the following costs spent by a borrower during an 8-week period after the origination date of the loan:
- Payroll costs for workers making less than $100K
- Any payment of interest on any covered mortgage obligation
- Any payment on any covered rent obligation
- Any covered utility payment
- The small business must affirmatively request loan forgiveness from the lender and work with the lender to provide documentation establishing that the small business maintained its payroll during the relevant period.
Q. Regarding the ban in the PSC order imposing late fees, does the ban apply retroactively to prohibit a public utility from imposing late fees for late payments that occurred prior to the Order?
A. This is what the Order says: A municipal utility may not assess upon any customer any fee or charge for late payment for an arrearage incurred during the period beginning with the effective date of this order (March 24, 2020). Therefore, late fees that were charged prior to the date of the order remain as part of the accounts receivable. But no additional late fees can be added to the bill during the emergency period.
Q. Regarding the option created by the order to waive credit card service charges, does the PSC order require third party credit card service providers, such as GovPayNet, to waive their service fees?
A. No, the Order does not require any utility or third-party service provider to waive their credit card service charges. The order simply provides that a public utility may, but is not required to, waive credit card convenience fees in order to encourage online payment. Any utility wishing to waive credit card fees must contact the Commission to request to opt-in to waiving fees.
Q: How should a municipal utility contact the Public Service Commission to request to opt-in to waiving credit card fees for its customers during the COVID-19 emergency?
A. The utility should file its request on the PSC’s Electronic Records Filing (ERF) system. Please upload an application letter to ERF under your Utility ID [XXXX] requesting the tariff change.
If your utility has more than one service type, you must file a separate application letter for each service type. The name of the ERF submission should be:
o “Request for Temporary Service Rules Waiving Credit Card Fees in Response to COVID-19 – Water”
o “Request for Temporary Service Rules Waiving Credit Card Fees in Response to COVID-19 – Electric”
o “Request for Temporary Service Rules Waiving Credit Card Fees in Response to COVID-19 – Gas”
• The application letter must include the preferred effective date, and if your utility has more than one service type (ie. water and electric), the letter must indicate which service type the request pertains to.
• By default, the waiver will be effective as of 3/24/20. If the utility prefers a later effective date, please include the preferred date in the letter.
Once PSC Records Management accepts the request, Commission staff will open a tariff amendment docket by service type (TE, TG, or TW).