S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  4280

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                            February 2, 2011
                               ___________

Introduced  by  M.  of  A.  P. RIVERA  --  read once and referred to the
  Committee on Corporations, Authorities and Commissions

AN ACT to amend the public service law, in relation to  prohibiting  the
  public  utilities  from  requiring  residential  service  deposits and
  prepayment for services

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Section 36 of the public service law, as added by chapter
713 of the laws of 1981, is amended to read as follows:
  S 36. Residential service deposits. [1. On and  after  January  first,
nineteen  hundred eighty-two, no] NO utility corporation or municipality
shall require any [new] residential customer[, other than a seasonal  or
short  term  customer,] to post a security deposit OR PREPAY ANY RATE OR
CHARGES FOR SERVICE as a condition of  receiving  utility  service.  [In
addition,  no  utility corporation or municipality shall after the first
day of September, nineteen hundred eighty-two, or such earlier  date  as
the  commission may determine, require a current residential customer to
post a security deposit other than such a  customer  who  is  delinquent
according  to standards set by the commission.] Deposits AND PREPAYMENTS
held on the first day of September, [nineteen  hundred  eighty-two]  TWO
THOUSAND  ELEVEN,  or such earlier date as the commission may determine,
shall be returned to the customer immediately, but not  later  than  the
next bill for service[; provided, however, that this provision shall not
apply  to  deposits  of  delinquent customers. No utility corporation or
municipality shall require any known  recipient  of  public  assistance,
supplemental  security  income  benefits or additional state payments to
post a security deposit as a condition of receiving service.
  2. Notwithstanding the provisions of subdivision one of this  section,
the commission, after investigation and hearing, may authorize any util-
ity  corporation  or  municipality to require and hold security deposits
from residential customers or applicants for service upon a finding that

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01018-01-1
              

A. 4280                             2

the collection and maintenance of such deposits is cost effective to the
utility as a whole without regard to cash flow and the  availability  of
capital.
  3. In any case where customer deposits are authorized by this section,
a  utility  corporation or municipality may require a customer or appli-
cant for service to deposit a reasonable sum of money according  to  the
estimated  quantity of such services necessary to supply the customer or
applicant for service  for  two  months,  to  secure  payment  for  such
services  actually  rendered, or for the rental of fixtures, instruments
and facilities actually supplied. Every  such  utility  corporation  and
municipality shall allow to every such customer or applicant for service
interest  on the sum deposited at a rate per annum to be prescribed from
time to time and at least annually by the commission in light of current
economic conditions and current charges paid for moneys borrowed by such
utility, taking into account the expenses incurred by  such  utility  in
obtaining,  handling,  returning  or  crediting  the sum deposited. Such
interest shall be paid upon the return of the deposit, provided however,
that whenever such deposit has been held for a period of one  year,  the
interest  shall  be credited to the customer or applicant for service on
the first billing for utility service rendered after  the  end  of  such
period.  If a customer or applicant for service is not delinquent in the
payment of any billing during such one year period, the deposit shall be
refunded promptly at the end thereof, without prejudice to the utility's
or municipality's right to require a deposit thereafter in the event  of
a  delinquency. All utility corporations and municipalities shall exempt
from deposit requirements any customer or applicant for service  who  is
sixty-two  years  of  age or older, unless the customer or applicant for
service is a bad credit risk according to standards set by  the  commis-
sion].
  S 2. Section 92-b of the public service law, as amended by chapter 716
of the laws of 1985, is amended to read as follows:
  S 92-b. Telephone deposits and payment plans for the elderly. 1.  [The
commission shall require all telephone corporations to exempt the dwell-
ing  units of all subscribing individuals who are sixty-two years of age
or older from any cash deposit requirement except where the  corporation
can show that the subscriber is a bad credit risk according to standards
set  by the commission] NO TELEPHONE CORPORATION SHALL REQUIRE ANY RESI-
DENTIAL CUSTOMER TO POST A SECURITY DEPOSIT OR PREPAY ANY RATE OR CHARGE
FOR TELEPHONE SERVICE AS A CONDITION FOR RECEIVING SUCH SERVICE.  DEPOS-
ITS  AND  PREPAYMENTS  HELD  ON THE FIRST DAY OF SEPTEMBER, TWO THOUSAND
ELEVEN, OR SUCH EARLIER DATE AS THE COMMISSION MAY DETERMINE,  SHALL  BE
RETURNED  TO  THE CUSTOMER IMMEDIATELY, BUT NOT LATER THAN THE NEXT BILL
FOR SERVICE.
  2. The commission shall require all telephone  corporations  to  offer
residential  customers  who  are  sixty-two years of age or older, as an
alternative to monthly billing, a plan for payment on a quarterly basis,
of charges for telephone service rendered by such corporations, provided
that such customer's average annual billing is not more than one hundred
fifty dollars. The commission may establish such  terms  and  conditions
for plans required under this section as it deems necessary or proper.
  S  3. Section 117 of the public service law, as amended by chapter 713
of the laws of 1981, is amended to read as follows:
  S 117. Consumer deposits. [Except as the right to require deposits  is
further  limited by section thirty-six of this chapter, a] NO gas corpo-
ration, [an] electric corporation, [a] gas and electric corporation, [a]
water corporation, [a] steam corporation, [a] telegraph corporation, [a]

A. 4280                             3

telephone corporation or [a] municipality rendering  equivalent  utility
services  may[, unless prohibited by the commission,] require any person
to whom such corporation or municipality  shall  supply  gas,  electric,
water,  steam,  telegraph  or  telephone  services  to POST A deposit [a
reasonable sum of money according to  the  estimated  quantity  of  such
services  necessary  to  supply  the  same  for two calendar months,] OR
PREPAY ANY RATE OR  CHARGE  FOR  SERVICE  to  secure  payment  for  such
services  actually  rendered, or for the rental of fixtures, instruments
and facilities actually supplied[, but every such corporation and  muni-
cipality  shall  allow  to  every  such depositor interest at a rate per
annum to be prescribed from time to time,  at  least  annually,  by  the
commission  in  the  light  of  current  economic conditions and current
charges paid for other moneys borrowed by such  corporation  or  munici-
pality, and the expenses incurred by such corporation or municipality in
obtaining, handling and returning or crediting the sum deposited, on the
sum  or  sums so deposited, payable upon the return of the deposit or at
earlier intervals as hereinafter prescribed. Whenever such  deposit  has
been held for a period of one year, the interest accrued on such deposit
shall  be  credited  to  the  depositor on the first billing for utility
service rendered after the next succeeding first day of October. If  the
depositor was not delinquent in the payment of any bill in such one year
period,  the  deposit shall be refunded promptly at the end thereof, but
without prejudice to the right to require a deposit  thereafter  in  the
event  of  a  delinquency  or  where  it can be shown that the financial
condition of a business customer is such that  it  is  likely  that  the
customer  may  default  in  the future, and to retain such deposit for a
prudent period; except that subject to such regulations as  the  commis-
sion  may establish, if the deposit is for utility service rendered to a
business, the deposit may be retained for a prudent period beyond such a
one year period. No provider of utility services shall  require  of  its
customer  within  its  service  area  a  new security deposit where such
customer was not required to post a security deposit or had  a  security
deposit  returned pursuant to this section and such customer establishes
a new residence and continues service with the same provider of  utility
services].  DEPOSITS AND PREPAYMENTS HELD ON THE FIRST DAY OF SEPTEMBER,
TWO  THOUSAND  ELEVEN, OR SUCH EARLIER DATE AS THE COMMISSION MAY DETER-
MINE, SHALL BE RETURNED TO THE CUSTOMER IMMEDIATELY, BUT NOT LATER  THAN
THE NEXT BILL FOR SERVICE.
  S  4.  This  act shall take effect on the thirtieth day after it shall
have become a law.