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2020 Special Session I

Budget Amendments - SB5015 (Floor Approved)

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Utility Disconnect Moratorium Language (language only)

Item 4-14 #2s

Item 4-14 #2s

Effective Date
Effective Date

Language

Page 241, strike lines 1 through 20 and insert:


"7. a. Notwithstanding any other provision of law, upon the declaration by the Governor of a state of emergency pursuant to § 44-146.17 of the Code of Virginia in response to a communicable disease of public health threat as defined in §44-146.16 of the Code of Virginia, electric companies subject to regulation of the State Corporation Commission (“Commission”), natural gas suppliers subject to the regulation of the Commission, electric and gas municipal utilities, and water suppliers and wastewater service providers (“utilities”) are prohibited from disconnecting service (“moratorium” or “prohibition”) to residential customers for non-payment of bills or fees until the Governor determines that the economic and public health conditions have improved such that the prohibition does not need to be in place, or until at least 60 days after such declared state of emergency ends, whichever is sooner. The utilities shall notify all customers who are at least 30 days in arrears of this utility disconnection moratorium and the COVID Relief Repayment Plan (“Repayment Plan”) within 60 days after the enactment of this Act, which may be by bill insert or bill notice, with information detailing its Repayment Plan, including eligibility and billing information; and


b. No more than 60 days after the enactment of this Act, the utilities must offer customers a Repayment Plan for past due accounts while such prohibition is in effect that includes, at minimum, the following provisions:


1. The Repayment Plan shall not require any new deposits, down payments, fees, late fees, interest charges, or penalties, nor shall such plan accrue any fees, interest, or penalties, including prepayment penalties;


2. The Repayment Plan shall amortize the repayment of a customer's utility debt over a minimum period of 6 months and up to 24 months for each utility. However, a customer may satisfy the Repayment Plan in part or in full at any time; and


3. The utilities shall not apply eligibility criteria, such as installment plan history, while on the Repayment Plan. However, the utilities may require the customer to attest to the utility or to a third party chosen by the utility that the customer has experienced a f­­inancial hardship resulting directly or indirectly from the public health emergency or that they have experienced a hardship to pay during the public health emergency.


4. During the disconnection moratorium, if a utility reports to a consumer reporting agency or debt collector regarding a consumer who is on a Repayment Plan the utility shall report the account as “current” in accordance with the Public Law 116-36: Coronavirus Aid, Relief, and Economic Security Act. Once the disconnection moratorium ends, the utility may resume reporting any default on the Repayment Plan.


c. Nothing herein shall limit or prevent the utilities or the residential customers from applying or seeking debt relief or mitigation from any available resource, from entering into another payment plan offered by the utility, or from renegotiating the terms of the Repayment Plan. If a utility has established a Repayment Plan program that provides financial assistance to utility customers with funding provided through the CARES Act, or directs customers where to access financial assistance with funding provided through the CARES Act, such utility's customers who are at least 30 days in arrears must seek assistance from these programs in order to reduce the customer's arrearage.  


d. Notwithstanding anything to the contrary in this clause 7 or any other provision of law, if a utility subject to regulation of the Commission has accounts receivable­­­ arrearages that exceed 1% of the utility's annual operating revenues, then the utility may obtain relief from this moratorium by filing an informational letter notice with the clerk of the Commission, stating such facts to demonstrate the exceedance and contemporaneously tendering associated workpapers to the staff of the Commission.  The Commission staff shall verify the information as filed by the utility and shall file a verification letter with the Clerk of the Commission.  The Commission, upon receipt of a favorable verification letter, shall issue a final order within five days. Upon issuance of an order, a utility shall thereafter be exempt from the moratorium provisions of this clause 7.


e. Notwithstanding anything to the contrary in this clause 7 or any other provision of law, if a utility subject to this clause 7 but not subject to regulation of the Commission has accounts receivab­­­le arrearages that exceed 1% of the utility's annual operating revenues, then the utility may obtain relief from this moratorium if (i) the utility provides a written analysis stating such facts to demonstrate the exceedance, (ii) the utility contemporaneously makes available for public inspection associated workpapers verifying such facts, and (iii) the governing body verifies the exceedance, provides public notice, takes public comment on, and votes to approve that the exceedance is accurate in an open public meeting. In the event of an affirmative vote of the utility's governing body, the utility shall thereafter be exempt from the moratorium provisions of this clause 7.


f. The Commission shall allow for the timely recovery of bad debt obligations, reasonable late payment fees suspended, and prudently incurred implementation costs resulting from a Repayment Plan for electric, gas, water, or wastewater utilities, excluding Phase II utilities, including through a rate adjustment clause or through base rates. The Commission may apply any applicable earnings test in the Commission rules governing utility rate applications and annual informational filings when assessing the recovery of such costs. The Commission shall also require the utilities subject to regulation by the Commission to submit an annual report on the status of the moratorium and the Repayment Plan, including (a) the number of accounts that are at least 30 days in arrears; (b) the number of accounts that are participating in the Repayment Plan, or another repayment plan as set forth by the utility, and (c) the cumulative level of customer arrearages by locality. The Commission shall provide the chairs of the House Committees on Labor and Commerce and Appropriations, the Senate Committees on Commerce and Labor and Finance and Appropriations, and the Secretary of Commerce and Trade an aggregated anonymized report by utility containing such compiled information within three months of the expiration of the prohibition and annually thereafter for the following two years.


g. Utilities not subject to regulation by the Commission shall submit an annual report on the status of the moratorium and the Repayment Plan to the Commission on Local Government, including (a) the number of accounts that are at least 30 days in arrears; (b) the number of accounts that are participating in the Repayment Plan, or another repayment plan as set forth by the utility, and (c) the cumulative level of customer arrearages by locality. The Commission on Local Government shall provide the chairs of the House Committees on Labor and Commerce and Appropriations, the Senate Committees on Commerce and Labor and Finance and Appropriations, and the Secretary of Commerce and Trade an aggregated anonymized report by utility containing such compiled information within three months of the expiration of the prohibition and annually thereafter for the following two years.


h. Within 60 days after the enactment of this act, a Phase II Utility shall forgive all such utility's jurisdictional customer balances more than 30 days in arrears as of September 30, 2020.


1. In the utility's 2021 triennial review, any forgiven amounts shall be excluded from the utility's cost of service for purposes of determining any test period earnings and determining any future rates of the utility. In determining any customer bill credits, in the utility's 2021 triennial review, the Commission shall first offset any forgiven amounts against the total earnings for the 2017 through 2020 test periods that are determined to be above the utility's authorized earnings band. Such offset shall be made prior to any offset to customer bill credits by customer credit reinvestment offsets.


2. Each Phase II Utility shall, no later than December 31, 2020, submit a report to the Governor, the Chairs of the House Committee on Labor and Commerce and the Senate Committee on Commerce and Labor, the Chairs of the House Appropriations Committee and the Senate Finance and Appropriations Committee, and the Chair of the Commission on Electric Utility Regulation, detailing all actions by it pursuant to this act to forgive customer balances."



Explanation

(This amendment replaces language in the Governor's introduced budget and provides for a moratorium on utility disconnections for non-payment of bills or fees during a declared state of emergency of a communicable disease of public health threat, to include electric companies and natural gas suppliers subject to regulation of the State Corporation Commission (SCC), electric and gas municipal utilities, and water suppliers and wastewater service providers. It also requires utlities to offer customers a COVID Relief Repayment Plan to pay past-due amounts, provides for an exemption from the moratorium for utilities under certain conditions, directs the SCC to allow for the timely recovery of bad debt obligations for utilities, excluding Phase II utilities, directs Phase II utilities to forgive jurisdictional customer debt for those 30 days in arrears as of September 30, 2020, and requires reporting by regulated and non-regulated utlities on the status of the moratorium and the Repayment Plan to the House Committees on Labor and Commerce and Appropriations, the Senate Committees on Commerce and Labor and Finance and Appropriations, and the Secretary of Commerce and Trade.)