SB3766sam001 97TH GENERAL ASSEMBLY

Sen. Don Harmon

Filed: 3/7/2012

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 3766

2    AMENDMENT NO. ______. Amend Senate Bill 3766 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Public Utilities Act is amended by changing
5Section 19-145 and by adding Sections 19-150 and 19-155 as
6follows:
 
7    (220 ILCS 5/19-145)
8    Sec. 19-145. Automatic adjustment clause tariff;
9uncollectibles.
10    (a) A gas utility shall be permitted, at its election, to
11recover through an automatic adjustment clause tariff the
12incremental difference between its actual uncollectible amount
13as set forth in Account 904 in the utility's most recent annual
14Form 21 ILCC and the uncollectible amount included in the
15utility's rates for the period reported in such annual Form 21
16ILCC. The Commission may, in a proceeding to review a general

 

 

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1rate case filed subsequent to the effective date of the tariff
2established under this Section, prospectively switch, from
3using the actual uncollectible amount set forth in Account 904
4to using net write-offs in such tariff, but only if net
5write-offs are also used to determine the utility's
6uncollectible amount in rates. In the event the Commission
7requires such a change, it shall be made effective at the
8beginning of the first full calendar year after the new rates
9approved in such proceeding are first placed in effect and an
10adjustment shall be made, if necessary, to ensure the change
11does not result in double-recovery or unrecovered
12uncollectible amounts for any year. For purposes of this
13Section, "uncollectible amount" means the expense set forth in
14Account 904 of the utility's Form 21 ILCC or cost of net
15write-offs as appropriate. In the event the utility's rates
16change during the period of time reported in its most recent
17annual Form 21 ILCC, the uncollectible amount included in the
18utility's rates during such period of time for purposes of this
19Section will be a weighted average, based on revenues earned
20during such period by the utility under each set of rates, of
21the uncollectible amount included in the utility's rates at the
22beginning of such period and at the end of such period. This
23difference may either be a charge or a credit to customers
24depending on whether the uncollectible amount is more or less
25than the uncollectible amount then included in the utility's
26rates.

 

 

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1    (b) The tariff may be established outside the context of a
2general rate case filing, and shall specify the terms of any
3applicable audit. The Commission shall review and by order
4approve, or approve as modified, the proposed tariff within 180
5days after the date on which it is filed. Charges and credits
6under the tariff shall be allocated to the appropriate customer
7class or classes. In addition, customers who do not purchase
8their gas supply from a gas utility and whose receivables are
9not included in a purchase of receivable program under Section
1019-150 shall not be charged by the utility for uncollectible
11amounts associated with gas supply provided by the utility to
12the utility's customers. Upon approval of the tariff, the
13utility shall, based on the 2008 Form 21 ILCC, apply the
14appropriate credit or charge based on the full year 2008
15amounts for the remainder of the 2010 calendar year. Starting
16with the 2009 Form 21 ILCC reporting period and each subsequent
17period, the utility shall apply the appropriate credit or
18charge over a 12-month period beginning with the June billing
19period and ending with the May billing period, with the first
20such billing period beginning June 2010.
21    (c) The approved tariff shall provide that the utility
22shall file a petition with the Commission annually, no later
23than August 31st, seeking initiation of an annual review to
24reconcile all amounts collected with the actual uncollectible
25amount in the prior period. As part of its review, the
26Commission shall verify that the utility collects no more and

 

 

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1no less than its actual uncollectible amount in each applicable
2Form 21 ILCC reporting period. The Commission shall review the
3prudence and reasonableness of the utility's actions to pursue
4minimization and collection of uncollectibles which shall
5include, at a minimum, the 6 enumerated criteria set forth in
6this Section. The Commission shall determine any required
7adjustments and may include suggestions for prospective
8changes in current practices. Nothing in this Section or the
9implementing tariffs shall affect or alter the gas utility's
10existing obligation to pursue collection of uncollectibles or
11the gas utility's right to disconnect service. A utility that
12has in effect a tariff authorized by this Section shall pursue
13minimization of and collection of uncollectibles through the
14following activities, including but not limited to:
15        (1) identifying customers with late payments;
16        (2) contacting the customers in an effort to obtain
17    payment;
18        (3) providing delinquent customers with information
19    about possible options, including payment plans and
20    assistance programs;
21        (4) serving disconnection notices;
22        (5) implementing disconnections based on the level of
23    uncollectibles; and
24        (6) pursuing collection activities based on the level
25    of uncollectibles.
26    (d) Nothing in this Section shall be construed to require a

 

 

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1utility to immediately disconnect service for nonpayment.
2(Source: P.A. 96-33, eff. 7-10-09.)
 
3    (220 ILCS 5/19-150 new)
4    Sec. 19-150. Purchase of receivables.
5    (a) For the purposes of this Section:
6    "Qualifying alternative gas supplier" means an alternative
7gas supplier that (i) is certified under Section 19-110 of this
8Act and (ii) includes its charges for gas sales made in a gas
9utility's service area on that gas utility's bill pursuant to
10Section 19-135 of this Act.
11    "Administrative costs" means all of the utility's costs
12incurred in its administration of the purchase of receivables
13program except for the deemed intangible costs.
14    (b) Within 6 months after the effective date of this
15amendatory Act of the 97th General Assembly, a gas utility with
16at least 100,000 customers that offers transportation service
17to residential customers and small commercial customers shall
18file a tariff pursuant to Article IX of this Act that provides
19qualifying alternative gas suppliers with the option to have
20the gas utility purchase their receivables for gas sales that
21are (1) made to residential customers and small commercial
22customers, as those terms are defined in Section 19-105 of this
23Article, and (2) charged on the gas utility's bill.
24    (c) Receivables for gas sales of qualifying alternative gas
25suppliers that are charged on the gas utility's bill shall be

 

 

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1purchased by the gas utility at a discount rate of 1%. The rate
2shall include 0.5% to be retained by the gas utility for
3recovery of deemed intangible costs, and neither this 0.5%
4portion of the rate, nor the deemed intangible costs, are
5subject to review by the Commission. The remaining 0.5% of the
61% discount rate shall be retained by the gas utility for
7recovery of the gas utility's administrative costs and is
8subject to periodic review by the Commission. Any portion of
9the 0.5% intended for recovery of administrative costs that is
10found by the Commission, after notice and hearing, to be in
11excess of prudent and reasonable costs shall annually, no later
12than August 1, be provided to the Department of Commerce and
13Economic Opportunity for the purpose of paying late payment
14charges and reconnection fees for households at or below 150%
15of the poverty level that have entered into a payment plan
16behind the individual utility service territory that is making
17the payment. The Department of Commerce and Economic
18Opportunity shall spend the entire amount provided before
19August 1 of the following year. To the extent there is a
20surplus, the Department shall have the ability to pay commodity
21arrearage amounts for households at or below 150% of the
22poverty level. Prior to August 1 of each year, the Department
23of Commerce and Economic Opportunity shall provide a report to
24the Commission on the number of households that received funds
25from this payment and for what purpose the payment was made.
26    (d) In making a just and reasonable determination on the

 

 

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1administrative costs, the Commission shall consider:
2        (1) the gas utility's reasonable start-up costs and
3    administrative costs associated with the gas utility's
4    purchase of receivables;
5        (2) the impact, if used by the gas utility, of an
6    automatic adjustment clause tariff pursuant to Section
7    19-145 of this Act to recover uncollectible expense; and
8        (3) whether the gas utility recovers uncollectible
9    expenses from customers of qualifying alternative gas
10    suppliers through any of its existing rates or charges.
11    (e) Reasonable start-up costs and administrative costs
12associated with the gas utility's purchase of receivables shall
13in the first instance be recovered from qualifying alternative
14gas suppliers through the gas utility's discount rate assessed
15by the gas utility on those qualifying alternative gas
16suppliers who have the gas utility purchase their receivables.
17In order to prevent barriers to suppliers' use of a purchase of
18receivables program and ensure full cost recovery for the gas
19utility in a timely manner, a portion of the gas utility's
20reasonable start-up costs, subject to reasonable carrying
21charges as determined by the Commission, may be deferred for
22later recovery from qualifying alternative gas suppliers who
23have the gas utility purchase their receivables through the
24discount rate or a monthly per bill fee, if such deferral is
25deemed to be necessary by the Commission. The gas utility
26retains the rights to (1) impose the same terms on residential

 

 

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1customers supplied by qualifying alternative gas suppliers
2with respect to credit and collection, including requests for
3deposits, and (2) disconnect the customers, if it does not
4receive payment for its tariffed services or purchased
5receivables, in the same manner that it would be permitted to
6if the customers had purchased gas supply service from the gas
7utility.
8    (f) The tariff filed pursuant to this Section shall permit
9the gas utility to recover from customers any uncollected
10receivables that may arise as a result of the purchase of
11receivables under this Section. The tariff filed pursuant to
12this Section shall provide for recovery of the prudently
13incurred costs associated with the provision of this service
14pursuant to this Section and may include other just and
15reasonable terms and conditions. Nothing in this Section
16permits the double recovery of uncollectible expenses from
17customers.
18    (g) Amounts collected by the gas utility attributable to
19the 0.5% portion of the discount rate under this Section for
20deemed intangible costs shall not be used by the Commission to
21lower the base rate revenue requirement of the gas utility in
22any subsequent rate case. In order to limit the implications on
23short-term debt of the gas utility, a gas utility may choose to
24delay purchase of unpaid receivables until the bill due date.
25Other than for initial implementation of the purchase of
26receivables program, when so choosing, a gas utility shall

 

 

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1remit payments to the alternative gas suppliers no more than 2
2business days after the due date.
 
3    (220 ILCS 5/19-155 new)
4    Sec. 19-155. Aggregation of natural gas load by
5municipalities and counties.
6    (a) The corporate authorities of a municipality or county
7board of a county may adopt an ordinance under which it may
8aggregate in accordance with this Section residential
9customers and small commercial customer natural gas loads
10located, respectively, within the municipality or the
11unincorporated areas of the county and, for that purpose, may
12solicit bids and enter into service agreements to facilitate
13for those loads the sale and purchase of natural gas and
14related services and equipment.
15    The corporate authorities or county board may also exercise
16such authority jointly with any other municipality or county.
17Two or more municipalities or counties, or a combination of
18both, may initiate a process jointly to authorize aggregation
19by a majority vote of each particular municipality or county as
20required by this Section.
21    If the corporate authorities or the county board seek to
22operate the aggregation program as an opt-out program for
23residential customers and small commercial customers, then
24prior to the adoption of an ordinance with respect to
25aggregation of residential customers and small commercial

 

 

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1customer natural gas loads, the corporate authorities of a
2municipality or the county board of a county shall submit a
3referendum to its residents to determine whether or not the
4aggregation program shall operate as an opt-out program for
5residential customers and small commercial customers.
6    In addition to the notice and conduct requirements of the
7general election law, notice of the referendum shall state
8briefly the purpose of the referendum. The question of whether
9the corporate authorities or the county board shall adopt an
10opt-out aggregation program for residential customers and
11small commercial customers shall be submitted to the electors
12of the municipality or county board at a regular election and
13approved by a majority of the electors voting on the question.
14The corporate authorities or county board must certify to the
15proper election authority, which must submit the question at an
16election in accordance with the Election Code.
17    The election authority must submit the question in
18substantially the following form:
19        "Shall the (municipality or county in which the
20    question is being voted upon) have the authority to arrange
21    for the supply of natural gas for its residential customers
22    and small commercial customers who have not opted out of
23    such program?"
24    The election authority must record the votes as "Yes" or
25"No".
26    If a majority of the electors voting on the question vote

 

 

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1in the affirmative, then the corporate authorities or county
2board may implement an opt-out aggregation program for
3residential customers and small commercial customers.
4    A referendum must pass in each particular municipality or
5county that is engaged in the aggregation program. If the
6referendum fails, then the corporate authorities or county
7board shall operate the aggregation program as an opt-in
8program for residential customers and small commercial
9customers.
10    An ordinance under this Section shall specify whether the
11aggregation shall occur only with the prior consent of each
12person owning, occupying, controlling, or using a natural gas
13load center proposed to be aggregated. Nothing in this Section,
14however, authorizes the aggregation of natural gas loads that
15are served or authorized to be served by a municipality that
16owns and operates its own gas distribution system. No
17aggregation shall take effect unless approved by a majority of
18the members of the corporate authority or county board voting
19upon the ordinance. A governmental aggregator under this
20Section is not a public utility, agent, broker, consultant or
21an alternative retail gas supplier.
22    (b) Upon the applicable requisite authority under this
23Section, the corporate authorities or the county board shall
24develop a plan of operation and governance for the aggregation
25program so authorized. Before adopting a plan under this
26Section, the corporate authorities or county board shall hold

 

 

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1at least 2 public hearings on the plan. Before the first
2hearing, the corporate authorities or county board shall
3publish notice of the hearings once a week for 2 consecutive
4weeks in a newspaper of general circulation in the
5jurisdiction. The notice shall summarize the plan and state the
6date, time, and location of each hearing. Any load aggregation
7plan established pursuant to this Section shall:
8        (1) provide for universal access to all applicable
9    residential customers and equitable treatment of
10    applicable residential customers;
11        (2) describe demand management and energy efficiency
12    services to be provided to each class of customers; and
13        (3) meet any requirements established by law
14    concerning aggregated service offered pursuant to this
15    Section.
16    (c) The process for selecting a natural gas supplier and
17awarding proposed agreements for the purchase of natural gas
18and other related services shall be conducted in the following
19order:
20        (1) First, the corporate authorities or county board
21    may solicit bids for natural gas and other related
22    services.
23        (2) Then, notwithstanding Section 19-115 of this Act
24    and Section 2FFF of the Consumer Fraud and Deceptive
25    Business Practices Act, a natural gas utility that provides
26    residential customers and small commercial customers

 

 

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1    natural gas service in the aggregate area must, upon
2    request of the corporate authorities or the county board in
3    the aggregate area, submit to the requesting party, in an
4    electronic format, those account numbers, names, and
5    addresses of residential customers and small commercial
6    customers in the aggregate area that are reflected in the
7    natural gas utility's records at the time of the request.
8    Any corporate authority or county board receiving customer
9    information from a natural gas utility shall be subject to
10    the limitations on the disclosure of the information
11    described in Section 19-115 of this Act and Section 2FFF of
12    the Consumer Fraud and Deceptive Business Practices Act,
13    and a natural gas utility shall not be held liable for any
14    claims arising out of the provision of information pursuant
15    to this item (2).
16    (d) If the corporate authorities or county board operate
17under an opt-in program for residential customers and small
18commercial customers, then:
19        (1) within 60 days after receiving the bids, the
20    corporate authorities or county board shall allow
21    residential customers and small commercial customers to
22    commit to the terms and conditions of a bid that has been
23    selected by the corporate authorities or county board; and
24        (2) if (A) the corporate authorities or county board
25    award proposed agreements for the purchase of natural gas
26    and other related services and (B) an agreement is reached

 

 

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1    between the corporate authorities or county board for those
2    services, then residential customers and small commercial
3    customers committed to the terms and conditions according
4    to item (1) of this subsection (d) shall be committed to
5    the agreement.
6    (e) If the corporate authorities or county board operate as
7an opt-out program for residential customers and small
8commercial customers, then it shall be the duty of the
9aggregated entity to fully inform residential customers and
10small commercial customers in advance that they have the right
11to opt out of the aggregation program. The disclosure shall
12prominently state all charges to be made and shall include full
13disclosure of the cost to obtain service pursuant to Section
1419-115 of this Act, how to access it, and the fact that it is
15available to them without penalty, if they are currently
16receiving service under that Section.
17    (f) The Illinois Commerce Commission shall adopt rules to
18implement this Section, including, but not limited to, the
19protection of customers already under contract with an
20alternative retail gas supplier, gas utility processes for
21enrollment of opt-out customers, and minimum opt-out
22disclosure requirements for opt-out aggregation.
 
23    Section 99. Effective date. This Act takes effect upon
24becoming law.".