‘This is not the time.’ KY senators stall bill punishing late utility payments.
Two skeptical state senators on Wednesday managed to stall a controversial House bill that would protect utilities’ right to charge late fees and to terminate service to customers who fall behind on their bills during a declared state of emergency, such as the COVID-19 pandemic.
“This is not the time to bring this bill,” state Sen. Robin Webb, D-Grayson, told the bill’s sponsors at a hearing of the Senate Natural Resources and Energy Committee.
Webb remarked on how the COVID-19 pandemic and recent ice storm and floods have hurt her Eastern Kentucky constituents.
“We’re all struggling, not just the low-income people,” Webb said.
Another senator, Johnnie Turner, R-Harlan, said neither he nor any constituents with whom he’s spoken are in favor of the House bill. With delays in mail delivery, Turner said, it’s not uncommon for utility bills and customer payments to arrive late no matter how diligent people try to be.
“I’ve spoken to some mayors in the counties that I represent, and they’re not for this. They know the poor people would be unable to pay it,” Turner said. “Their people just couldn’t handle that.”
Moments later, the Senate committee canceled its planned vote on House Bill 272 at its final scheduled hearing of the 2021 legislative session. Instead, the sponsors withdrew the bill from consideration and pledged to work with Webb and Turner on a compromise that still could be approved by lawmakers in the session’s final days.
The bill targets the Kentucky Public Service Commission, which last year imposed temporary moratoriums on utility late fees and cutoffs because of the economic recession caused by the pandemic.
The moratoriums expired by year’s end.
But the PSC in recent months told four water districts and electric utility Kentucky Power to stop charging a late fee. After studying data it collected from a broad swath of utilities during the moratoriums, the PSC concluded that late fees create “a hardship” for poor people already struggling with their bills but show “no material effect on the percentage of customers paying on time.”
The bill’s sponsors told the Senate committee that the PSC is mistaken, and utilities must be able to crack down on customers who don’t promptly pay their bills.
“The purpose of this bill isn’t to punish people. The purpose of this bill is to keep our small utilities strong,” said state Rep. Josh Bray, R-Mount Vernon.
Tom FitzGerald, director of the Kentucky Resources Council, warned senators that the bill would neuter the PSC, which is supposed to protect consumers from abuses by utilities. If the PSC determines that a late fee is inappropriate in certain instances, then it should be allowed to act on that judgment, FitzGerald said.
“In this case, we are now saying that every utility — electric, gas, water, wastewater — that is regulated by the Public Service Commission can impose whatever late fees they want, and the commission — and nobody is going to have the oversight to say that is punitive, that is unreasonable or that is unjustified,” FitzGerald said.
