Assembly May Add Unpaid Power Bills to Yours

By Steve Haner

The General Assembly is moving toward a second method of transferring money from electricity customers who can pay their bills to those who cannot. A Senate bill up today will allow Dominion Energy Virginia and Appalachian Power to simply add yet another “rider” to everybody’s monthly bill for their uncollected accounts receivable.

It is still possible the Assembly will reach into assumed excess profits on the part of Dominion and use $320 million of that to cover payments which have been allowed to lapse during the COVID-19 pandemic. As reported here a while back, that idea is being proposed as an amendment to the state budget, still being written behind closed doors.

But only Dominion has such a pot of cash hanging out there to raid, not the other utilities with hundreds of millions of unpaid electricity, gas, and water bills. And that approach may indeed not appear in the budget after all, leaving Senate Bill 5118 as the main path forward. The link is to the substitute, to which the following was added by a Senate Committee last week:

The Commission shall (emphasis added) allow for the timely recovery of bad debt obligations, reasonable late payment fees suspended, and prudently incurred implementation costs resulting from an (Emergency Debt Retirement Plan) for jurisdictional 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.

 “Shall” is the key word, of course.  If asked, the State Corporation Commission must say yes.  And the provision allowing collection “through base rates” in effect does the same thing as the proposed budget language, allowing the SCC to apply any cash the utility has lying around during a rate case. It also could lead to an increase in base rates to cover the unpaid bills. 

When the bill was discussed in the Senate Finance and Appropriations Committee last week, the patron, Senator (and candidate for Governor) Jennifer McClellan, D-Richmond, said “I am not aware of any opposition.” That means the utilities, advocates for the poor, and others who got involved have all signed off. Did anybody speak up for other consumers? Don’t count on it.

The bill cleared that most-powerful committee with only one Republican voting no and two Democrats abstaining. One of those latter was Senator Chap Petersen of Fairfax, who asked a couple of fairly mild questions of McClellan. “Don’t we need to give some guidance to the Commission,” he asked?

McClellan explained that this bill does not make or extend the bill moratorium, first imposed by the State Corporation Commission months ago. The Commission could extend that on its own, but more likely there will be a provision in the budget bill to do that. Governor Ralph Northam asked to prevent disconnections until his emergency order ends.

If and when the moratorium ends, this bill creates a long-term payment plan, up to 12 months with no requirement for pre-payment, interest, or penalties. An earlier version of the bill had some tight limits on the amount of back payment per month, but they disappeared in the substitute.

Even without those tight constraints, thousand and perhaps tens of thousands of households will not be able to pay these back bills, not in 12 months or 24. Unless a pile of money appears out of thin air (which is where Washington finds its dough), at the end of the repayment period substantial sums will still be owed. And that is where the new language creating the possible rate adjustment clause will come into play.

Don’t forget, if you are a paying customer and not low income, your bill will have one new charge on it in January for the new Percentage of Income Payment Plan (PIPP), as previously discussed. So now, perhaps a year later, a second special assessment will appear, and its size will depend on how long the SCC gives you to pay off the other customers’ debts. How many years you are charged will be at the Commission’s discretion, at least until the General Assembly decides to do something else.

And it isn’t just for this moratorium on disconnections due to this particular pandemic. Oh no. This cost-shifting process is to be in place for any “subsequent state of emergency order.”

“Subsequent state of emergency order” means a future state of emergency issued by the Governor 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 that is unrelated to the COVID-19 pandemic.

This does not apply to municipal electric, gas, or water systems. In fact, the amendment removed a requirement they report on their uncollectable bills, unless the General Assembly asks. Cities in the utility business are on their own, again, until the General Assembly decides to do something else. Which it does as regularly as the sun rises.

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29 responses to “Assembly May Add Unpaid Power Bills to Yours

  1. Okay, that “shall (added)”, added by whom? Although, one would fully expect that “shall” would be found in that spot, what is the “(added)”?

    But, Steve, in the United States of Americorporatia what else would you expect? And no, the wealth isn’t transferred from those who can pay to those who cannot. Those who cannot are just the excuse to take money from those who can pay and give large bonuses for ULM and dividends and gains to the shareholders.

    • “Emphasis added.” Sorry, clarified that. Agreed, the company may get its profits along with the debtor-customers getting their bill paid. But the language is vague and the SCC may just cover the cost sans profit.

      • Ah, better. For a moment there I thought you had added the verb, in which case it’s far scarier that we have lawmakers who could not form a complete sentence.

        What was that wonderful 2008 buzz phrase all the conservatives were pitching at the mortgagees? Moral hazard! Yeah, where is the risk for Dominion? They get all the benefits of a business venture, roi, profits, dividends, etc., protected by the State from risk.

        No, not just no profit. No, here is where the corporate citizen should be as at risk as we are. If we must suffer a loss to get through this, then the “corporations are people too, my friend” should not benefit. Opps, take a loss, Bubba.

  2. So Steve, if this bill applies only to Dominion (which is swimming in $$) and Apco (which is not), the other utilities that you mention, the coops, the gas, water and sewer companies, etc., will be free to take such action as available to them under the law, such as disconnection or civil action for debt collection?

    • So, are not gas or water utilities “jurisdictional utilities?” I’m not reading this as only the power companies. It’s a term of art and I might be wrong. It only covers those the SCC regulates, that I’m sure of.

      • Yes, most gas and some water companies are jurisdictional to the Commission, but only Apco and DEV are eligible to attach rate adjustment clauses to their bills, per the Electric Reregulation Act. Perhaps I should say are the only ones “currently eligible” to use rate adjustment cluases.

  3. Change the “shall” to “will”, and I’m down with it. Make it predictive rather than compulsory.

    • Again, shall is the term of art.

    • In contract language “shall” is synonymous with “may, will or must”.

      “The word ‘Shall’ has the following meanings:

      An imperative command; has a duty to or is required to. For example, the notice shall be sent within 30 days. Usually ‘shall’ used here is in the mandatory sense.
      Should . Courts often interpret shall as should. For example, all claimants shall request mediation.
      May. When a negative word such as not or no precedes shall the word shall often means may. For example, no person shall enter the building without first signing the roster.
      Will . For example, the defendant shall then have a period of 30 days to object.”

    • The weatherman says, “It will rain tomorrow,” God says, “It shall.”

      Terms of the art, as per Steve. Actually, as per my company contracts officer. Her quote.

      • Your comment in nonsensical and pointless, per usual.

        It’s not “terms of the art” it’s “term of art” which regards a specialized phrase that has a precise meaning in a given field.

        In contracts and contract law, shall is used. Using the term “will” will get you in trouble.

      • Is that not what I said? Shall is compulsory. Will is predictive. Case in point:
        “Under GFE you say,’The gov’t will supply data from FBE Echo.’ Can you perform the terms and condition to collect our money if they don’t?”
        “Uh, no.”
        “Then it’s ‘The gov’t shall supply…”

        • “Nancy_Naive | September 16, 2020 at 6:18 am | Reply
          The weatherman says, “It will rain tomorrow,” God says, “It shall.”

          Terms of the art, as per Steve. Actually, as per my company contracts officer. Her quote.”

          That was your comment, it meant nothing.

    • Madam said, “In contract language ‘shall, is synonymous with ‘may, will or must’.”

      Then Madam says, “In contracts and contract law, shall is used. Using the term “will” will get you in trouble.”

      Well, which is it, Madam, are they synonymous, or not?

      • Oh look at that, NN using a passive aggressive insult.

        Umm they are synonymous, but they are party dependent and if you use them incorrectly you’ll be requiring yourself to do things you cannot.

        I wouldn’t expect a Virginia Plantation Elite son of a Flag Officer to know that. I mean that would require you to not have traded on his name your entire life.

        Yeah that was personal, because you can’t keep it above board.

      • Just to clarify this issue: Drafters of legislation do not use the word “will”. As Nancy said, it is predictive. However, it could be interpreted as a command, as in, “You WILL do your homework!” So, the two key words are “may” and “shall”. That is clear. One is authorizing language; the other is compelling language. So, Steve is correct. Is is a term of art.

        • As someone familiar with Legislation (contracts) you know that shall and will take on different meanings.

          Per the Legal dictionary “shall” is confined to “has a duty to.

          While “will” is to create a promise to perform.

          The issue is when “will” is used merely to describe a future event.

          I was taught for the contracts that I deal with and read that “shall” means has a duty to provide. In a specific instance we use the following example:

          “The contractor shall provide all product data sheets for clients review and approval”.

          That would mean the contractors is subject to the clients review and approval of all products to be installed.

          Where as replacing “will” in that statement merely provides for a future instance that doesn’t has no bounds.

        • “You WILL do your homework!”

          Wait! That works? Where’s the “OR ELSE”?

      • Flag officer?! Mustangs rarely if ever make flag officer. Plantation elite? Uh, yep. I think the enlisted housing was called “The Plantations on Robin Hood Road”, now that you mention it.

        No Matt. I didn’t grow up real poor, but not rich. Worked my way through college. Got good jobs at which I did hard work, if not work hard. Like the song says, “Chances are you’ll go far if you fall in with the right bunch of fellows”.

        I always lived within my means. Bought used cars and a small house, which I repaired and improved. Invested. Invested well. Didn’t chase the hot sectors. Saved.

        But most importantly, and clearly contrary to you. I enjoyed and found joy and happiness in everything that I did or had to do. Everything. And so, I have a modest house, a big boat, and enough in retirement and taxable accounts to be in the top 3% easily.

        Oh, did I mention I was happy?

        So get personal. It’s funny when angry people get personal with happy people like it will somehow make them unhappy. Whatever floats your boat, boy.

  4. Ahhh, Jennifer McClellan. One of the two Jennifers running for governor from Petersburg. Will she be the McClellan that takes Richmond? Or will she fail as George Briton McClellan did in 1862. “For Richmond is a hard road to travel I believe”. From the song “Stonewall Jackson’s Way”.

  5. Guvment once again picking Winners and losers….
    Losers… us hard working responsible folk…
    Winners, with Starbucks coffee, 7/11 lottery tickets, beer and cigarettes not to mention other drugs, and zero personal responsibility,, hey we deserve this stuff…

    • Another example of the kind of bias-ridden foolishness that you’d probably never post if your name were attached. It is the worst thing about this blog. Most of these people thrown out of work did not choose it and are not so behaving. They are victims of the government, which shut down so much and is now putting up roadblocks to re-opening, and the media fear mongers who have terrified the population so effectively that even businesses now open again are struggling.

    • Winners now, losers in the long run when their cigarette habit leads them to COPD and being tethered to an oxygen machine, waiting to die as the COPD gets worse.

      Speaking of which, I noticed that 0% of Virginia’s tobacco settlement money goes to healthcare. The majority of it appears to go towards funding “economic development”, aka crony capitalism.

  6. Sharing this. Disturbing, thanks for the article.

  7. Pingback: Dominion ❤ New Utility Bill Payment Plan | Bacon's Rebellion

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