TITLE economic-regulation

Part I. Railroad Commission of Texas

Chapter 3. Oil and Gas Division

16 TAC §3.98

The Railroad Commission of Texas adopts amendments to §3.98, relating to standards for management of hazardous oil and gas waste without changes to the proposed text as published in the February 26, 1999, issue of the Texas Register (24 TexReg 1297).

The amendment to subsection (u) requires that annual reports be submitted on the form prescribed by the commission rather than the form prescribed by the United States Environmental Protection Agency. This amendment allows the use of a new reporting form developed by the commission, Form H-21. The commission anticipates that this form will be easier for affected operators to complete and information provided will be in a form more readily usable by the commission.

The commission also repeals subsection (cc) which set out the effective date of the original rule. This subsection is no longer necessary.

No comments on the proposed amendments were received.

The amendments to §3.98 are adopted under Texas Natural Resources Code, §81.052, which authorizes the commission to adopt all necessary rules for governing and regulating activities under its jurisdiction as set forth in Texas Natural Resources Code, §81.051; Texas Natural Resources Code, §85.042, which authorizes the commission to make and enforce rules pertaining to field operations that pose a danger to life or property; Texas Natural Resources Code, §141.012, which authorizes the commission to adopt rules relating to the exploration, production, and development of geothermal energy and associated resources; Texas Natural Resources Code, §91.101(4), which authorizes the commission to adopt rules relating to the discharge, storage, handling, transportation, reclamation, or disposal of oil and gas waste, as well as any other substance or material associated with any operation regulated by the commission under Texas Natural Resources Code, §91.101; Texas Natural Resources Code, §91.602, which authorizes the commission to adopt rules relating to the generation, transportation, treatment, storage, or disposal of hazardous oil and gas waste; and Texas Water Code, §27.036, which authorizes the commission to adopt rules relating to brine mining.

The Texas Natural Resources Code, §§ 81.052, 85.042, 91.101, 91.601-605, and 141.001-141.018; and Texas Water Code §27.036, are affected by the amendments.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 14, 1999.

TRD-9902194

Mary Ross McDonald

Deputy General Counsel, Office of General Counsel

Railroad Commission of Texas

Effective date: May 4, 1999

Proposal publication date: February 26, 1999

For further information, please call: (512) 463-7008


Part II. Public Utility Commission of Texas

Chapter 23. Substantive Rules

The Public Utility Commission of Texas (commission) adopts the repeals of §23.6 relating to Spanish Language Requirements, §23.41 relating to Customer Relations, §23.42 relating to Refusal of Service, §23.43 relating to Applicant and Customer Deposit, §23.44 relating to New Construction, §23.45 relating to Billing, and §23.46 relating to Discontinuance of Service with no changes to the proposed text as published in the December 18, 1998 Texas Register (23 TexReg 12846). These repeals are necessary to avoid duplicative rule sections. These repeals are adopted under Project Number 17709. As a result of the reorganization of the commission's rules, new §§25.21-25.26 and §§25.28-25.31 concerning customer service have been adopted in Chapter 25, Substantive Rules Applicable to Electric Service Providers, and new §§26.21-26.31 concerning customer service have been adopted in Chapter 26, Substantive Rules Applicable to Telecommunications Service Providers to replace these sections.

The commission received no comments on the proposed repeals.

Subchapter A. General Rules

16 TAC §23.6

This repeal is adopted under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 1998) (PURA) which provides the commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction.

Cross-Index to Statutes: Public Utility Regulatory Act §14.002.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 16, 1999.

TRD-9902221

Rhonda Dempsey

Rules Coordinator

Public Utility Commission of Texas

Effective date: May 6, 1999

Proposal publication date: December 18, 1998

For further information, please call: (512) 936-7308


Subchapter E. Customer Service and Protection

16 TAC §§23.41, 23.42, 23.43, 23.44, 23.45, 23.46

These repeals are adopted under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 1998) (PURA) which provides the commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction.

Cross-Index to Statutes: Public Utility Regulatory Act §14.002.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 16, 1999.

TRD-9902222

Rhonda Dempsey

Rules Coordinator

Public Utility Commission of Texas

Effective date: May 6, 1999

Proposal publication date: December 18, 1998

For further information, please call: (512) 936-7308


16 TAC §23.40

The Public Utility Commission of Texas (commission) adopts the repeal of §23.40 relating to Prepaid Local Telephone Service with no changes to the proposed text as published in the January 1, 1999, Texas Register (24 TexReg 19). This repeal is necessary to avoid duplicative rule sections. This repeal is adopted under Project Number 17709. As a result of the reorganization of the commission's rules, new §26.29 relating to Prepaid Local Telephone Service has been adopted in Chapter 26, Substantive Rules Applicable to Telecommunications Service Providers, to replace §23.40.

The commission received no comments on the proposed repeal.

This repeal is adopted under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 1998) (PURA) which provides the commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction.

Cross-Index to Statutes: Public Utility Regulatory Act §14.002.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 16, 1999.

TRD-9902223

Rhonda Dempsey

Rules Coordinator

Public Utility Commission of Texas

Effective date: May 6, 1999

Proposal publication date: January 1, 1999

For further information, please call: (512) 936-7308


Chapter 25. Substantive Rules Applicable to Electric Service Providers

Subchapter B. Customer Service and Protection

16 TAC §§25.21-25.26, 25.28-25.31

The Public Utility Commission of Texas (the commission) adopts new §25.21, relating to General Provisions of Customer Service and Protection; new §25.22, relating to Request for Service; new §25.23, relating to Refusal of Service; new §25.24, relating to Credit Requirements and Deposits; new §25.25, relating to Issuance and Format of Bills; new §25.26, relating to Spanish Language Requirements; new §25.28, relating to Bill Payment and Adjustments; new §25.29, relating to Disconnection of Service; new §25.30, relating to Complaints; and, new §25.31, relating to Information to Applicants and Customers with changes to the proposed text as published in the December 11, 1998, Texas Register (23 TexReg 12574). These sections are adopted under Project Number 19513.

New §25.21 presents specific definitions for "applicants," "customers," and "days," and establishes that the purpose of the customer service and protection rules is to set a minimum standard for the provision of utility service. New §25.21 also provides that utilities may adopt less restrictive standards for differing groups of customers as long as they do not discriminate against protected groups. New §25.22 replaces §23.44(c)(3) and (d) of this title (relating to New Construction). New §25.23 replaces §23.42 of this title (relating to Refusal of Service). New §25.24 replaces §23.43 of this title (relating to Applicant and Customer Deposit). New §25.25 replaces §23.45(a), (b), (c), and (e) of this title (relating to Billing). New §25.26 replaces §23.6 of this title (relating to Spanish Language Requirements). New §25.28 replaces §23.45 of this title (relating to Billing). New §25.29 replaces §23.46 of this title (relating to Discontinuance of Service). New §25.30 replaces §23.41(c) of this title (relating to Customer Relations). New §25.31 replaces §23.41(a) and (b) of this title (relating to Customer Relations).

The Appropriations Act of 1997, HB 1, Article IX, Section 167 (Section 167) requires that each state agency review and consider for readoption each rule adopted by that agency pursuant to the Government Code, Chapter 2001 (Administrative Procedure Act). Such reviews shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist. The commission held three workshops to conduct a preliminary review of its rules. As a result of these workshops, the commission is reorganizing its current substantive rules located in 16 Texas Administrative Code (TAC), Chapter 23, to (1) satisfy the requirements of Section 167; (2) repeal rules no longer needed; (3) update existing rules to reflect changes in the industries regulated by the commission; (4) do clean-up amendments made necessary by changes in law and commission organizational structure and practices; (5) reorganize rules into new chapters to facilitate future amendments and provide room for expansion; and (6) reorganize the rules according to the industry to which they apply. Chapter 25 has been established for all commission substantive rules applicable to electric service providers. The duplicative sections of Chapter 23 are proposed for repeal as each new section is proposed for publication in the new chapter. No one commented on the Section 167 requirement as to whether the reason for adopting the rules continues to exist. The commission finds that the reason for adopting these sections continues to exist.

The commission received written comments on the proposed rules from seven public interest (PI) groups (joint comments for Consumers Union (CU) Southwest Regional Office; Texas Ratepayers' Organization to Save Energy (ROSE); Texas Legal Services Center; Public Citizen, Texas Office; Gray Panthers, Texas; Texas Citizen Action; and Texas Alliance for Human Needs); Texas Department of Housing and Community Affairs (TDHCA); the South Texas Cooperatives (Jackson Electric Cooperative; Karnes Electric Cooperative; Nueces Electric Cooperative; San Patricio Electric Cooperative; Victoria Electric Cooperative; and Wharton County Electric Cooperative); Southwestern Public Service Company (SPS); El Paso Electric Company (EPE); Entergy, Gulf States, Inc. (EGS); Texas-New Mexico Power Company (TNMP); Texas Utilities Electric Company (TU); Houston Lighting & Power Company (HL&P); CSW (Central Power and Light Company; Southwestern Electric Power Company; and West Texas Utilities Company); and Texas Electric Cooperatives, Inc. (TEC). The commission also received reply comments from TU, CSW, East Texas Cooperatives (ETC), TDHCA, HL&P, EGS, and PI.

A public hearing on the proposed rules was held at the commission offices on February 9, 1999 at 9:00 a.m. Representatives from the South Plains Community Action Agency (SPCAA), Gulf Coast Community Services Association, Community Action Nacogdoches, Texas Legal Services Center, Texas Rose, EOAC of Waco, Community Action Council of South Texas, Community Action Agency of Brownsville, TU, SPS, and EGS offered oral comments at the public hearing. Others attending the public hearing were representatives from HL&P and CSW.

Certain proposed changes led to much disagreement between the commenting parties. These issues caused extensive debate and are discussed below.

Major Issues

§25.28(b), penalty on delinquent bills for retail service

The electric utility industry commenters (HL&P, TU, EGS, and TEC) strongly approved of the proposed rule change that would allow the electric utilities to impose a 5.0% penalty for late payment of bills on both commercial and residential customers. The current rule allows the 5.0% penalty to be applied only to commercial accounts. The industry commenters indicated that the costs incurred by utilities due to late payment could be taken out of the general rate base and applied directly to those who cause the extra cost. In contrast, PI and TDHCA strongly opposed the proposed change in the current rule. They indicated that the utilities already have the extra costs for late payment and uncollectable debts built into their rates, and this proposed rule would allow the utilities to collect these costs twice and, thus, increase revenues. PI and TDHCA also indicated that this penalty would have disastrous effects on the poor and those on fixed incomes. Based on these comments, the commission has withdrawn the proposed change and reverts back to its current rule, which does not allow a delinquent penalty for late payment on residential accounts.

The commission has based this decision on the following: (1) A more detailed analysis of each utilities' commission-approved rates would be required to determine whether the impact of additional revenues is significant enough to trigger a rate case; and (2) The Public Utility Regulatory Act, Chapter 36, Subchapter G (Rate Changes by Certain Electric Cooperatives), §36.254(b) "Application of Other Provisions", states that "A service fee or a service rule set by an electric cooperative under this subchapter must comply with commission rules that apply to all electric utilities." As such, the commission is precluded from modifying this rule so that rate deregulated electric cooperatives could impose a late fee on residential accounts.

§25.28(d)(1), underbilling

The proposed rule provides that an electric utility may backbill up to six months for underbilled accounts. In their comments, TU, HL&P, and EGS proposed allowing a utility to backbill as far back as they have records, at least on commercial customers. CSW proposed that backbilling and overbilling should be limited to two years. In their reply comments, PI and TDHCA indicated the time period in which backbilling is permitted should be decreased or eliminated. The commission believes that the rule is fair as proposed and the recommended changes are unnecessary.

§25.29(g), disconnection of ill and disabled

The proposed rule provides that service cannot be disconnected if such action would threaten the life of some person residing at the residence. HL&P and TU fully supported the new rule in their comments, because it clarified the conditions for prohibition of disconnection. PI and TDHCA argued for retaining the old language of prohibiting disconnection when a resident would become "seriously ill or more seriously ill" due to disconnection of service. The commission agrees with PI and proposed §25.29(g) is revised accordingly.

§25.29(i)(2), disconnection during extreme weather

The proposed rule sets the no-disconnect heat index temperature at 104 degrees Fahrenheit for extreme heat conditions. In their reply comments, HL&P and TU recommended that the heat index be raised to 105 degrees Fahrenheit, while EGS and CSW agreed with the demarcation at 104 degrees Fahrenheit. TDHCA and PI both recommended that the extreme heat temperature be set at 100 degrees Fahrenheit, based on information from the Texas Department of Health which states that use of fans may actually endanger lives at temperatures above 100 degrees Fahrenheit.

The commission believes that much of the confusion associated with the wording in the original rule could be associated with the term "heat alert" that is issued by the National Weather Service, because the heat index associated with this term is in excess of 110 degrees Fahrenheit. The 110 degree heat index alert has rarely, if ever, been reached and thus few heat alerts would ever be declared. The commission revises the wording of the original rule to change the disconnection trigger to the "heat advisory" declared by the National Weather Service (NWS). The NWS issues a heat advisory on a county-specific basis when the heat index reaches 105 degrees Fahrenheit or above; this could occur when the temperature is 90 degrees, with high humidity. The commission declines to adopt the PI recommendation to use a 100 degree heat index trigger to suspend disconnections because the NWS does not issue announcements at this heat index level and it would be administratively challenging for utilities to track the heat index county by county all summer long. Since TDHCA and PI comment that a 100 degree temperature is cause for health concerns, it appears that the 105 degree heat index advisory trigger should occur whenever absolute temperatures reach 100 degrees or higher.

The commission revises the proposed rule to prohibit disconnections throughout a utility's service territory after the NWS issues a heat advisory for any county in its service territory.

Other Issues

§25.21. General Provisions of Customer Service and Protection Rules.

CSW stated that the entities to which the rules apply in subsection (a) are too narrowly defined. It suggests that the rules were intended to govern customer service to retail customers, exclusive of those retail customers served by municipalities. The commission agrees that clarification is required and §25.21(a) is revised as follows: "Unless the context clearly indicates otherwise, in this subchapter the term 'electric utility' applies to all electric utilities that provide retail electric service in Texas. It does not apply to municipal utilities."

CSW and EGS recommended deleting "at a different location" from the definition of applicant in §25.21(c)(1), because anyone who applies for service, regardless of location, should be considered an applicant. The commission agrees and §25.21(c)(1) is revised as follows: "Applicant - A person who applies for service for the first time or reapplies after discontinuance of service."

§25.22. Request for Service.

TU, TEC, and STC recommended retaining the current language for proposed §25.22(1) because the proposed language makes the seven-day connection period a requirement rather than a guideline, as it is in the existing rule. EGS recommended inserting the phrase, "has met the credit requirements as provided for in §25.24 of this title and" after "the applicant" so that the electric utility can determine credit worthiness of the applicant prior to connecting service. The commission agrees with EGS' suggested change.

EGS recommended inserting the phrase, "and has complied with all applicable state and municipal regulations" at the end of the first sentence in proposed §25.22(3) so the electric utility will not have to connect service in violation of state and municipal regulations. TNMP recommended adding language that the parties could agree to a longer term than 90 days so special circumstances that are inherent in certain jobs can be addressed. The commission agrees with both of these recommendations and §25.22(3) is amended as follows: "Requests for new residential service requiring construction, such as line extensions, shall be completed within 90 days or within a time period agreed to by the customer and electric utility if the applicant has met the credit requirements as provided for in §25.24 of this title; made satisfactory payment arrangements for construction charges; and has complied with all applicable state and municipal regulations."

EGS recommended that §25.22(4) apply only to residential customers and the ten-day deadline for informing customers of expected costs and dates of completion should be raised to 15 working days because the existing rule does not apply to large industrial or commercial customers and the ten-day deadline may not be enough time in all instances. TU suggested retaining the current rule or, if the new rule were adopted, the ten-day deadline should begin only after all required information to complete the job is received from the customer. The commission believes the ten-day deadline is appropriate for all customer classes, and the rule will remain as proposed.

EGS recommended that §25.22(6) apply only to residential customers for the same reasons as discussed for §25.22(4); TU suggested retaining the current language for the same reason as EGS; and TNMP wanted the phrase "reasonable control" clarified and wording added that would allow agreements for longer periods than the 90 days for those jobs that would require extensive preparation and construction. The commission agrees with TNMP and the first sentence of §25.22(6) is revised as follows: "Unless the delay is beyond the reasonable control of the electric utility, a delay of more than 90 days shall constitute failure to serve, unless the customer and electric utility have agreed to a longer term."

HL&P recommended that the commission-approved brochure on renewable energy sources be reviewed and revised to satisfy the requirements of §25.22(7) relating to on-site renewable energy and distributed generation technology alternatives. This is a good suggestion and the commission may implement it as workload permits. In the meantime, however, the electric utility companies should develop their own material on this issue to satisfy the rule.

TU, CSW, EGS, HL&P, EPE, and TEC recommended deleting the requirement to inform applicants as part of the initial contact about their right to file a complaint with the commission (§25.22(8)), because this information is contained in the pamphlet, "Your Rights as a Customer." They were also concerned that giving the customer this information in the initial contact would convey a negative impression of the company's service quality. PI stated that it is a benefit to all residential ratepayers to be informed of the commission's role in customer protection. PI further stated that the rule could benefit applicants without being a detriment to utility operations by including a simple statement (e.g., "If you think you have been treated unfairly, you have the right to file a complaint with the PUC.")

The commission believes that the utility should provide the applicant a copy of the "Your Rights as a Customer" brochure and inform the applicant of the complaint process if the applicant thinks the applicant has been treated unfairly and revises proposed §25.22(8) accordingly.

§25.23. Refusal of Service.

EGS proposed adding a new subsection, "(a)(7) Failure to provide adequate identification" and a new subsection, "(a)(8) Application is made in the name of a minor, a deceased person, or a fraudulent name as acceptable reason to refuse service." The commission disagrees, because there is nothing that prohibits the electric utility from adopting these standards as part of their procedures since "adequate identification" is not defined. The rule will remain as proposed.

CSW suggested that refusal of service should be allowed for failure to comply with any of the electric utility's tariff requirements. The commission declines to add the term "tariff" since it broadens the application of this section unnecessarily, therefore, §25.23(a) is revised as follows: "An electric utility may refuse to serve an applicant until the applicant complies with state and municipal regulations and the utility's rules and regulations on file with the commission or for any of the reasons identified below."

HL&P and CSW suggested that proposed §25.23(a)(4) concerning "intent to deceive" needs to be clarified so that there is a clear understanding of what constitutes "deception". Both CSW and HL&P suggested specific wording to accomplish this. The commission agrees that more clarity is needed and the first sentence of §25.23(a)(4) is revised as follows: "The applicant applies for service at a location where another customer received, or continues to receive, service and the utility bill is unpaid at that location and the electric utility can prove the change in identity is made in an attempt to help the other customer avoid or evade payment of an electric utility bill."

CSW recommended that reference to "present customer" in proposed §25.23(c) be deleted because under §25.21(c)(2) a customer is a person who is currently receiving service; that a new subsection be added to proposed §25.23(c) to make clear that refusal to pay a bill of another does constitute valid grounds for refusing service if the conditions of §25.23(a)(4) are met; and that the "and" after §25.23(c)(2) should be changed to an "or" and moved to the end of §25.23(c)(3).

The commission agrees with all of these recommendations, and the rule is changed accordingly.

EGS, HL&P, CSW, and TU all recommended that proposed §25.23(c)(3) be amended to allow a utility to backbill for a period greater than six months if the backbilling was the result of theft of service because theft of service is not addressed. They were also concerned that the wording of proposed §25.23(c)(3) allows the customer to wait six months before complaining in order to avoid a legitimate backbilling charge. The commission agrees with both of these recommendations, and §25.23(c)(3) is revised as follows: "failure to pay a bill that includes more than the allowed six months of underbilling, unless the underbilling is the result of theft of service."

§25.24. Credit Requirements and Deposits.

CSW recommended adding the phrase, "nor had a check dishonored", to the end of proposed §25.24(a)(2)(A)(ii) because timely remittance of a check is not an indication of credit worthiness unless the check is honored by the bank. Because a dishonored check would be the same as a late payment, the commission does not believe the phrase is necessary, and the rule remains as proposed.

Proposed §25.24(a)(2)(A)(iii) included the phrase "during the last 12 consecutive months of service was not late in paying a bill." This language is inconsistent with that in the current §23.43(b)(3)(A). The commission did not intend to change the current credit requirements for residential applicants by requiring a perfect payment record. The commission revises that part of §25.24(a)(2)(A)(iii) as follows: "during the last 12 consecutive months of service was not late in paying a bill more than once".

TNMP recommended that §25.24(a)(2)(B)(i-iv) should be deleted because these are not assurances that a customer will pay his/her electric utility bill. Since these provisions are not intended to guarantee that a customer will pay his/her bill, but only to demonstrate satisfactory credit, the commission disagrees, and the rule remains as proposed.

TU and HL&P recommended that the term "current bill" in proposed §25.24(c)(2) be replaced by the term "total amount due" because the term "current bill" could be interpreted as the current month's consumption. The commission agrees that clarity is needed, and the rule is revised to reflect "the total amount due on the current bill".

CSW recommended that the last sentence of §25.24(c)(2) be deleted, because it is difficult for the electric utility and the customer to track whether the option has been exercised by the customer during the previous 12 months. CSW suggested replacement language for the rule; however, the commission disagrees with the recommendation, and it will not be implemented.

EGS recommended that the language in proposed §25.24(d)(1)(A) be revised to read as follows: "the average of the customer's actual billings for the last 12 months are at least twice the amount of the original estimated annual billings" because this wording is clearer. The commission agrees, and the rule is revised accordingly.

CSW recommended that in proposed §25.24(d)(2), reference should be made to an "additional deposit" and not to a "new deposit" because the section is referring to an additional deposit. The commission agrees, and the rule is revised accordingly.

HL&P and TU recommended the term, "current bill," in proposed §25.24(d)(3) be replaced with the term, "total amount due" because the term "current bill" could be interpreted as the current month's consumption. CSW recommended that §25.24(d)(3) be deleted for the same reasons as presented for §25.24(c)(2). The commission agrees with HL&P and TU, but disagrees with the CSW recommendation. Subsection (d)(3) is revised as follows: "Instead of an additional deposit, the customer may pay the total amount due on the current bill by the due date of the bill, provided the customer has not exercised this option in the previous 12 months".

EGS recommended that the language for §25.24(f) be changed to read as follows: "The total of all deposits shall not exceed an amount equivalent to twice the highest monthly bill for the previous 12 months" because it affords the company more coverage against high-risk applicants/customers. The commission disagrees with this recommendation, and §25.24(f) remains as proposed.

CSW commented that the reference to the interest rate set by the commission in proposed §25.24(g) should be to the rate set on December 1 of the preceding year. The commission agrees, and the rule is revised accordingly.

TU commented that §25.24(h)(1-4) should be deleted because this information is contained in "Your Rights as a Customer" pamphlet. The commission modifies the rule to indicate that the specified information is in the brochure, which should be given to the customer when the deposit is needed.

EGS recommended that a new §25.24(j)(6) be added and to read as follows: "An electric utility may require a guarantor to maintain satisfactory credit as a condition of continuing to guarantee the deposit for another residential customer" because this will clarify that guarantors must maintain good credit standing as a condition for their guarantee of a deposit for another residential customer. The commission declines to specify what requirements an electric utility may impose on a guarantor.

CSW recommended that the last sentence of proposed §25.24(k)(1) be deleted because the circumstances under which a customer or applicant may be required to make a deposit or provide a letter of credit are clearly set out for an applicant who has been a prior customer of the electric utility (see §§25.24(a)-(e)). If those criteria apply, the electric utility should be able to require the individual to make a deposit, regardless of whether the transfer of service is or is not considered a disconnection of service. The commission does not agree that a transfer of service should trigger the same deposit requirements, and declines to make the change proposed by CSW.

CSW recommended that the last sentence of proposed §25.24(k)(2) be revised to address letters of guarantee, because if the customer has established credit through a letter of guarantee and fails to meet the refund criteria, it should be permissible to retain the letter of guarantee. EGS recommended that the 24 months of consecutive billings in §24.25(k)(2) apply to both residential and commercial customers. The commission agrees with the recommendation of CSW, but disagrees with the recommendation of EGS. The last sentence of §25.24(k)(2) is revised to read as follows: "If the customer does not meet these refund criteria, the deposit and interest or the letter of guarantee may be retained".

§25.25. Issuance and Format of Bills.

TU and TEC recommended that §25.25(c)(4) be deleted because the information is contained in the "Your Rights as a Customer" pamphlet. The commission believes this information should be on the bill as well, and the rule remains as proposed.

TU, TEC, EGS, and EPE recommended that §25.25(c)(5) be deleted because the information is contained in the "Your Rights as a Customer" pamphlet. The commission agrees and revises the rule accordingly.

TNMP requested that application of §25.25(c)(5) be delayed until it implements its new Y2K software package, because it currently does not have the ability to add this information to its bill. The commission proposes waivers for a limited period of time if an electric utility requests, additional time due to software upgrades that would be necessary to comply with the rule.

CSW commented that the last two sentences of proposed §25.25(d)(1) are unrealistic. If the meter reader cannot read the meter, it would be impossible for the electric utility to mail the customer a card, have the customer read the meter, and have the customer mail the card back to the electric utility in time for the normal issuance of the bill. The bill would have to be estimated anyway. The commission believes the proposed language is clear in its intent, and the rule remains as proposed.

EGS, TNMP, TU, and CSW recommended deleting the last sentence of proposed §25.25(f) because the meaning is unclear and it contradicts the first sentence. The commission agrees, and the last sentence of proposed §25.25(f) is deleted.

§25.26. Spanish Language Rule.

PI recommended that proposed §25.26(a) be updated to refer to the most current U.S. Census rather than the 1990 Census. The commission agrees and revises §25.26(a) accordingly.

§25.28. Bill Payment and Adjustments.

STC suggested revising the phrasing in proposed §25.28(c)(3)(C) to avoid the impression that usurious rates were allowed. The commission agrees and revises §25.28(c)(3)(C) as follows: "All interest shall be compounded monthly based on the annual rate".

CSW commented that it is unnecessary in all instances when the underbilling is $50 or more that the period of the deferred payment plan extend as long as the period of backbilling as presented in §25.28(d)(3) because it is not realistic to allow a commercial account to have two years to pay a $50 backbilling. TU and TDHCA both agreed with the proposed rule and commented that $50 was a good medium point. The commission finds that §25.28(d)(3) is reasonable, and it remains as proposed.

On §25.28(d)(4), CSW commented that interest should apply to backbilling in the same manner as it applies to overbilling. The commission believes that a customer should not be charged interest for an error made by the company; therefore, the rule remains as proposed.

EGS, TEC, and STC commented that §25.28(e)(2) should be revised to include the payment of the average billing and reinstate the current resolution time limit of 60 days. They contend that the customer should be required to pay the average billing to avoid accumulating a large past due balance. The 60-day resolution time period clarifies when disconnection can occur. TU and HL&P also recommended reinstating the 60-day resolution time limit because customers could stall an investigation and avoid paying the disputed amount indefinitely. CSW recommended retaining the current rule because it provides that customers need not pay the disputed amount that exceeds the average billing. The commission agrees that the payment of the average billing is a current requirement that needs to be retained in the proposed rule; however, the current 60-day resolution time limit will not be reinstated. The commission revises §25.28(e) by adding new paragraph (3) to address disputed amounts in complaints filed with the commission, and paragraph (4) to address payment of the average billing on disputed amounts billed by electric utilities.

CSW and STC commented that proposed §25.28(h) should allow payment programs of less than three months. HL&P and EGS supported this in their reply comments because a payment arrangement of less than three months may be more beneficial to the customer. The commission believes that the proposed rule does not prohibit the electric utilities from making payment arrangements of less than three months; therefore, the rule remains as proposed.

PI commented that proposed §25.28(i) should allow deferred payment plans to be a minimum of six months; that all late fees should be waived on deferred payment plans; and electric utilities should be required to offer deferred payment plans to all customers because this would be more beneficial to the elderly and low income households. TDHCA commented that §25.28(i) should extend the term of deferred payment agreements to six months and the plans should not go into effect until low consumption months. TDHCA also contends that electric utilities should offer customers an arrears forgiveness program, and the number of disconnect notices a customer receives in a 12-month period should have no effect on whether the customer is offered a deferred payment plan, because this burdens low-income families and those on fixed incomes.

In their reply comments, TU, HL&P, CSW, and EGS all disagreed with extending deferred payment plans to six months. They explained that the present wording allows the electric utilities to work with customers and extend deferred payment plans for whatever term is necessary. These utilities also disagreed with extending deferred payment plans to all customers due to credit risk. TU pointed out in its reply comments that the pilot Maintenance of Effort (MER) program, which was equivalent to an arrears forgiveness program, was disastrous to both the company and the customers. CSW commented that proposed §25.28(i) should require all deferred payment plans to be in writing and not just those made over the telephone.

The commission believes that §25.28(i) adequately addresses the length and terms of a deferred payment agreement. However, TDHCA raised a question about the relevance of the number of disconnection notices a customer receives in a 12-month period to whether or not a deferred payment plan is offered. The Texas Legislature is considering two proposed bills that address the issue that TDHCA has addressed; therefore, the commission will delay action on this comment until a future date. The commission also agrees that all deferred payment plans should be put in writing. The commission revises the last sentence of §25.28(i) as follows: "A deferred payment plan may be established in person or by telephone, and all deferred payment plans shall be put in writing."

CSW commented that §25.28(i)(1) should allow an electric utility to refuse a deferred payment plan to customers who have rendered dishonored checks to the electric utility in the past 12 months because of credit risks associated with this type of behavior. The commission disagrees with CSW because the electric utility can require payment in either cash or money order from a customer who has rendered a dishonored check. The rule stands as proposed.

CSW recommended that §25.28(i)(2) should preserve the existing requirements and clarify that the customer must initially pay the current bill and a reasonable amount of the outstanding bill, not to exceed one-third of the outstanding bill, and may pay the remainder of the outstanding bill in equal installments lasting at least three billing cycles. The commission believes that the proposed wording establishes the three-billing cycle plan and is clearer than the current rule; therefore, §25.28(i)(2) remains as proposed.

CSW comments that proposed §25.28(i)(4)(H) should not require deferred payment plans made over the telephone and mailed to the customer for signature to be mailed back to the utility. This requirement would delay the effect and/or implementation of the agreement until it is mailed back. If the agreement is not returned, it makes the electric utility's status with the customer and disconnection ambiguous. The commission agrees and §25.28(i)(4)(H) is revised to clarify that an agreement is in effect unless the customer contacts the electric utility to challenge the terms as they are written.

HL&P commented that a customer should be required to prove any downturn in his/her financial condition in order to renegotiate a deferred payment plan as presented in §25.28(i)(4)(I). The proposed rule does not prohibit the electric utility from establishing criteria that will be consistently used during the renegotiation process; therefore, the rule remains as proposed.

§25.29. Disconnection of Service.

CSW commented that the last sentence of proposed §25.29(a) should be revised as follows: "Disconnection is an option allowed by the commission, not a requirement placed upon the utility by the commission." This shows the option is "allowed" not "offered" by the commission. The commission agrees, and the rule is revised accordingly.

CSW recommended that proposed §25.29(b)(3) allow disconnection for other tariff violations, as stated in comments to proposed §25.23(a). The commission believes that expanding disconnections to "other tariff violations" unnecessarily broadens the scope of this rule. As a result, the rule remains as proposed.

TU commented that proposed §25.29(d)(4) would allow a customer to wait more than six months or delay payment on a backbilled amount more than six months in order to avoid ever paying what could be a legitimate underbilling. The commission disagrees and believes the rule is fair and understandable as proposed.

TU commented that §25.29(d)(5) should permit disconnection if the disputed amount is not paid within the current 60-day time limit based on comments concerning §25.28(e)(2). The commission disagrees, because there is no longer a 60-day time limit.

CSW commented that proposed §25.29(d)(5) should allow disconnection if the average bill is not paid for reasons commented on §25.28(e)(2). The commission agrees and revises §25.29(d)(5) as follows: "failure to pay disputed charges, except for the required average billing payment, until a determination as to the accuracy of the charges has been made by the electric utility or the commission and the customer has been notified of this determination;".

CSW suggested that the wording in the current §23.46(f) be retained for §25.29(e) because the new wording allows disconnection on the day after a holiday or weekend when utility personnel may not be available to take payments or perform reconnections, and the old rule takes care of this problem. The commission finds the wording of proposed §25.29(e) addresses the same issues as §23.46(f). Therefore, the subsection remains as proposed.

CSW commented that in §25.29(g)(1)(A), contact made to the utility should be by the "stated date of disconnection" not by the "due date of the bill" since the customer has received a disconnection notice. The commission agrees, and the rule is revised accordingly.

TDHCA and PI commented that the prohibition on disconnection in §25.29(g)(2) should be for the duration of the illness, as determined by a physician in order to better protect the ill resident. HL&P and TU disagreed with this in their reply comments citing that an open-ended time period would lead to abuse. The commission believes that the 63-day time limit is a sufficient period to balance the concerns of all parties. The rule remains as proposed.

TDHCA commented that the word "grantees" be changed to "clients" in §25.29(h) in order to remain consistent with their agency language. The commission agrees, and the rule is revised.

PI recommended adding the following language to §25.29(h): "No electric utility may terminate service to a delinquent residential customer for a billing period in which the electric utility receives a pledge, letter of intent, purchase order, or other notification that the energy assistance provider is forwarding sufficient payment to continue service" because the current wording is unclear and misrepresents the role of the customer. The commission agrees, and the rule is revised accordingly.

CSW recommended that proposed §25.29(k)(4) be modified to provide disconnection notices in Spanish only to those electric utilities to which §25.26(a) applies. The commission disagrees because disconnection notices should be in both English and Spanish to assure that the individual customer is informed he or she will be disconnected, and what to do to prevent it. The rule remains as proposed.

EGS and TU commented that proposed §25.29(k)(5) should be a toll-free number instead of a statement of notification because they believe a customer should contact a major company service center; CSW commented that the notice should contain the contact number of the electric utility's corporate offices and not just a local office because the customer should be able to contact the utility. The commission believes the notification statement contains important customer information that is necessary when the customer receives the disconnection notice; therefore, it will be retained. Furthermore, the commission agrees with CSW that a corporate toll-free number should be included on the notice. The last sentence of §25.29(k)(5) is revised as follows: "The notice shall also advise the customer to contact the electric utility for more information."

§25.30. Complaints.

TU, TEC, EPE, EGS, CSW, and STC commented that the requirement in proposed §25.30(a) that the utility complete an investigation of a customer complaint within 15 calendar days is unreasonable. The commenters stated that additional time is required to contact the customer and to make a correct determination on the merits of the complaint. TU stated that if a change to the 30 calendar days was inevitable, then the change should not be less than 15 working days. HL&P also recommended 15 working days, while SPS recommended 20 calendar days. The commission believes that while most complaints can be resolved within 15 calendar days, additional time is required for others. The commission modifies proposed §25.30(a) to state that the utility shall investigate and advise the complainant of the results of the investigation within 21 days after the complaint is forwarded to the utility.

CSW commented that §25.30(b)(3) should require the results of a supervisory review by the utility to be reduced to writing if it is not resolved to the satisfaction of the customer, even if a written copy is not requested. The rule does not prohibit the electric utility from reducing the results of its supervisory reviews to writing and each electric utility can make this determination. Therefore, the rule remains as proposed.

TEC, EPE, EGS, CSW, STC, and TU commented that the requirement in proposed §25.30(c)(2) that the utility complete an investigation of a commission complaint within 15 calendar days is unreasonable. TU commented that it should not be less than 15 working days if a change is inevitable. HL&P also recommended 15 working days, while SPS recommended 20 calendar days.

The Legislature places a high value on prompt resolution of complaints as evidenced by a commission performance measure. Also, electronic communication should shorten the time for sending complaints and receiving responses. Therefore, the commission amends §25.30(c)(2) to extend the time allowed for a utility investigation of a commission complaint from 15 calendar days to 21 days.

§25.31. Information to Applicants and Customers.

HL&P and TU recommended deleting the phrase "or transfer existing service to a new location" from proposed §25.31(a). They argue that it would put an undue cost on the electric utility to supply a customer who is merely transferring his service to a new location, with information he has already been supplied. The commission agrees but will address the matter of the customers information packet in §25.31(a)(3) by not requiring the packet be given to those customers that are transferring service.

PI recommended that a requirement be added to §25.31(a)(1) making electric utilities use standardized terms and pricing when describing pricing options to customers so as to make it less confusing. The commission does not believe that standardized terms and pricing are necessary to describe the lowest-priced alternatives.

HL&P recommended inserting a statement into proposed §25.31(a)(1) that places responsibility on non-residential applicants for providing complete and accurate information relating to their service requirements so that the electric utility can give accurate information about lowest-priced alternatives. The commission agrees that the electric utility needs accurate information from the applicant, however, it is not necessary to include this requirement in the rule because it is understood that the utility can only give an accurate estimate based on the information they are given by the applicant/customer. The rule remains as proposed.

CSW recommended that the commission's e-mail address be added to the information contained in proposed §25.31(c)(5)(I) so customers can contact the commission by e-mail. The commission agrees, and the rule is modified accordingly.

HL&P, EGS, TU, and CSW recommended that proposed §25.31(c)(5)(J) should have a toll-free number where this information can be obtained instead of listing all utility offices and authorized payment locations because of the large numbers of locations they have. The commission agrees, and the rule is revised accordingly.

SPS commented that the information on the critical load customer list is proprietary information contained in its Emergency Operations Plan and feels that proposed §25.31(c)(5)(R) should be deleted because of this. The commission believes there is some confusion in the way the proposed rule is worded and will amend the rule to have the electric utility provide information on how a residential customer can be placed on the critical load list. The amended §25.31(c)(5)(R) will read as follows: "information that contains the criteria on how a residential customer can be recognized as a critical load customer, the benefits of being a critical load customer in an emergency situation, and the process for being placed on the critical load list."

All comments, including any not specifically referenced herein, were fully considered by the commission. Where appropriate, non-substantive clarifications identified in Project Number 19517, Transfer of Existing Telephone Customer Service and Protection Rules to New Chapter 26 and Associated Changes are applied to these rules. The commission also makes other minor changes for clarification.

These new sections are adopted under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 1998) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction, and specifically, §§37.151 and 38.001 which require the commission to regulate electric utility operations and services; §37.151 which grants the commission authority to require an electric utility to make service available within a reasonable time after receipt of a bona fide request for service; §36.051 which authorizes the commission to establish and regulate rates of an electric utility; §§37.051 and 38.151 which require certificate holders to provide continuous and adequate service in their service areas; §38.001 which requires electric utilities to furnish service, instrumentalities, and facilities that are safe, adequate, efficient, and reasonable; §38.002 which grants the commission authority to adopt just and reasonable standards, classifications, rules, or practices an electric utility must follow, to adopt adequate and reasonable standards for measuring a condition, including quantity and quality relating to the furnishing of service, to adopt reasonable rules for examining, testing, and measuring a service, and adopt or approve reasonable rules, specifications, and standards to ensure the accuracy of equipment, including meters and instruments, used to measure service.

Cross Index to Statutes: Public Utility Regulatory Act §§14.002, 36.051, 37.051, 37.151, 38.001, and 38.151.

§25.21.General Provisions of Customer Service and Protection Rules.

(a)

Application. Unless the context clearly indicates otherwise, in this subchapter the term "electric utility" applies to all electric utilities that provide retail electric utility service in Texas. It does not apply to municipal utilities.

(b)

Purpose. The purpose of the rules in this subchapter is to establish minimum customer service standards that electric utilities must follow in providing electric service to the public. Nothing in these rules should be interpreted as preventing an electric utility from adopting less restrictive policies for all customers or for differing groups of customers, as long as those policies do not discriminate based on race, color, sex, nationality, religion, or marital status.

(c)

Definitions. The following words and terms when used in this subchapter shall have the following meanings, unless the context indicates otherwise.

(1)

Applicant - A person who applies for service for the first time or reapplies after discontinuance of service.

(2)

Customer - A person who is currently receiving service from an electric utility in the person's own name or the name of the person's spouse.

(3)

Days - Unless the context clearly indicates otherwise, in this subchapter the term "days" shall refer to calendar days.

§25.22.Request for Service.

Every electric utility shall initiate service to each qualified applicant for service within its certificated area in accordance with this section.

(1)

Applications for new electric service not involving line extensions or construction of new facilities shall be filled within seven working days after the applicant has met the credit requirements as provided for in §25.24 of this title (relating to Credit Requirements and Deposits) and complied with all applicable state and municipal regulations.

(2)

An electric utility may require a residential applicant for service to satisfactorily establish credit in accordance with §25.24 of this title (relating to Credit Requirements and Deposits), but such establishment of credit shall not relieve the customer from complying with rules for prompt payment of bills.

(3)

Requests for new residential service requiring construction, such as line extensions, shall be completed within 90 days or within a time period agreed to by the customer and electric utility if the applicant has met the credit requirements as provided for in §25.24 of this title; and made satisfactory payment arrangements for construction charges; and has complied with all applicable state and municipal regulations. For this section, facility placement which requires a permit for a road or railroad crossing will be considered a line extension.

(4)

If facilities must be constructed, then the electric utility shall contact the customer within ten working days of receipt of the application, and give the customer an estimated completion date and an estimated cost for all charges to be incurred by the customer.

(5)

The electric utility shall explain any construction cost options such as rebates to the customer, sharing of construction costs between the electric utility and the customer, or sharing of costs between the customer and other applicants following the assessment of necessary line work.

(6)

Unless the delay is beyond the reasonable control of the electric utility, a delay of more than 90 days shall constitute failure to serve, unless the customer and electric utility have agreed to a longer term. The commission may revoke or amend an electric utility's certificate of convenience and necessity (or other certificate) for such failures to serve, or grant the certificate to another electric utility to serve the applicant, and the electric utility may be subject to administrative penalties pursuant to the Public Utility Regulatory Act §15.023 and §15.024.

(7)

If an electric utility must provide a line extension to or on the customer's premises and the utility will require that customer to pay a Contribution in Aid to Construction (CIAC), a prepayment, or sign a contract with a term of one year or longer, the electric utility shall provide the customer with information about on- site renewable energy and distributed generation technology alternatives. The information shall comply with guidelines established by the commission, and shall be provided to the customer at the time the estimate of the CIAC or prepayment is given to the customer. If no CIAC or prepayment is required, the information shall be given to the customer before a contract is signed. The information is intended to educate the customer on alternate options that are available.

(8)

As part of their initial contact, electric utility employees shall give the applicant a copy of the "Your Rights as a Customer" brochure, and inform an applicant of the right to file a complaint with the commission pursuant to §25.30 of this title (relating to complaints) if the applicant thinks the applicant has been treated unfairly.

§25.23.Refusal of Service.

(a)

Acceptable reasons to refuse service. An electric utility may refuse to serve an applicant until the applicant complies with state and municipal regulations and the utility's rules and regulations on file with the commission or for any of the reasons identified below.

(1)

Applicant's facilities inadequate. The applicant's installation or equipment is known to be hazardous or of such character that satisfactory service cannot be given, or the applicant's facilities do not comply with all applicable state and municipal regulations.

(2)

Violation of an electric utility's tariffs. The applicant fails to comply with the electric utility's tariffs pertaining to operation of nonstandard equipment or unauthorized attachments which interfere with the service of others. The electric utility shall provide the applicant notice of such refusal and afford the applicant a reasonable amount of time to comply with the utility's tariffs.

(3)

Failure to pay guarantee. The applicant has acted as a guarantor for another customer and failed to pay the guaranteed amount, where such guarantee was made in writing to the electric utility and was a condition of service.

(4)

Intent to deceive. The applicant applies for service at a location where another customer received, or continues to receive, service and the electric utility bill is unpaid at that location, and the electric utility can prove the change in identity is made in an attempt to help the other customer avoid or evade payment of an electric utility bill. An applicant may request a supervisory review as specified in §25.30 of this title (relating to Complaints) if the electric utility determines that the applicant intends to deceive the electric utility and refuses to provide service.

(5)

For indebtedness. The applicant owes a debt to any electric utility for the same kind of service as that being requested. In the event an applicant's indebtedness is in dispute, the applicant shall be provided service upon paying a deposit pursuant to §25.24 of this title (relating to Credit Requirements and Deposits).

(6)

Refusal to pay a deposit. Refusing to pay a deposit if applicant is required to do so under §25.24 of this title.

(b)

Applicant's recourse. If an electric utility has refused to serve an applicant under the provisions of this section, the electric utility must inform the applicant of the reason for its refusal and that the applicant may file a complaint with the commission as described in §25.30 of this title.

(c)

Insufficient grounds for refusal to serve. The following are not sufficient cause for refusal of service to an applicant:

(1)

delinquency in payment for service by a previous occupant of the premises to be served;

(2)

failure to pay for merchandise or charges for non-regulated services, including but not limited to insurance policies, Internet service, or home security services, purchased from the electric utility;

(3)

failure to pay a bill that includes more than the allowed six months of underbilling, unless the underbilling is the result of theft of service; or

(4)

failure to pay the bill of another customer at the same address except where the change in identity is made to avoid or evade payment of an electric utility bill.

§25.24.Credit Requirements and Deposits.

(a)

Credit requirements for permanent residential applicants.

(1)

An electric utility may require a residential applicant for service to establish and maintain satisfactory credit as a condition of providing service.

(A)

Establishment of credit shall not relieve any customer from complying with the electric utility's requirements for prompt payment of bills.

(B)

The credit worthiness of spouses established during shared service in the 12 months prior to their divorce will be equally applied to both spouses for 12 months immediately after their divorce.

(2)

A residential applicant can demonstrate satisfactory credit using any one of the criteria listed in subparagraphs (A) through (C) of this paragraph.

(A)

The residential applicant:

(i)

has been a customer of any electric utility for the same kind of service within the last two years;

(ii)

is not delinquent in payment of any such electric utility service account;

(iii)

during the last 12 consecutive months of service was not late in paying a bill more than once;

(iv)

did not have service disconnected for nonpayment; and

(v)

is encouraged to obtain a letter of credit history from the applicant's previous electric utility, and electric utilities are encouraged to provide such information with the final bill.

(B)

The residential applicant demonstrates a satisfactory credit rating by appropriate means, including, but not limited to, the production of:

(i)

generally acceptable credit cards;

(ii)

letters of credit reference;

(iii)

the names of credit references which may be quickly and inexpensively contacted by the electric utility; or

(iv)

ownership of substantial equity that is easily liquidated.

(C)

The residential applicant is 65 years of age or older and does not have an outstanding account balance incurred within the last two years with the electric utility or another electric utility for the same type of utility service.

(3)

If satisfactory credit cannot be demonstrated by the residential applicant using these criteria, the applicant may be required to pay a deposit pursuant to subsection (c) of this section.

(b)

Credit requirements for non-residential applicants. For non-residential service, if an applicant's credit has not been demonstrated satisfactorily to the electric utility, the applicant may be required to pay a deposit.

(c)

Initial deposits.

(1)

A residential applicant or customer who is required to pay an initial deposit may provide the electric utility with a written letter of guarantee pursuant to subsection

(j)

of this section, instead of paying a cash deposit.

(2)

An initial deposit may not be required from an existing customer unless the customer was late paying a bill more than once during the last 12 months of service or had service disconnected for nonpayment. The customer may be required to pay this initial deposit within ten days after issuance of a written termination notice that requests such deposit. Instead of an initial deposit, the customer may pay the total amount due on the current bill by the due date of the bill, provided the customer has not exercised this option in the previous 12 months.

(d)

Additional deposits.

(1)

An additional deposit may be required if:

(A)

the average of the customer's actual billings for the last 12 months are at least twice the amount of the original estimated annual billings; and

(B)

a disconnection notice has been issued for the account within the previous 12 months.

(2)

An electric utility may require that an additional deposit be paid within ten days after the electric utility has issued a written disconnection notice and requested the additional deposit.

(3)

Instead of an additional deposit, the customer may pay the total amount due on the current bill by the due date of the bill, provided the customer has not exercised this option in the previous 12 months.

(4)

The electric utility may disconnect service if the additional deposit is not paid within ten days of the request, provided a written disconnection notice has been issued to the customer. A disconnection notice may be issued concurrently with either the written request for the additional deposit or current usage payment.

(e)

Deposits for temporary or seasonal service and for weekend residences. The electric utility may require a deposit sufficient to reasonably protect it against the assumed risk for temporary or seasonal service or weekend residences, as long as the policy is applied in a uniform and nondiscriminatory manner. These deposits shall be returned according to guidelines set out in subsection (k) of this section.

(f)

Amount of deposit. The total of all deposits shall not exceed an amount equivalent to one- sixth of the estimated annual billing.

(g)

Interest on deposits. Each electric utility requiring deposits shall pay interest on these deposits at an annual rate at least equal to that set by the commission on December 1 of the preceding year, pursuant to Texas Utilities Code §183.003 (Vernon 1998) (relating to Rate of Interest). If a deposit is refunded within 30 days of the date of deposit, no interest payment is required. If the electric utility keeps the deposit more than 30 days, payment of interest shall be made retroactive to the date of deposit.

(1)

Payment of the interest to the customer shall be made annually, if requested by the customer, or at the time the deposit is returned or credited to the customer's account.

(2)

The deposit shall cease to draw interest on the date it is returned or credited to the customer's account.

(h)

Notification to customers. When a deposit is required, the electric utility shall provide the applicant or customer written information about deposits by providing the "Your Rights as a Customer" brochure, which contains the relevant information.

(i)

Records of deposits.

(1)

The electric utility shall keep records to show:

(A)

the name and address of each depositor;

(B)

the amount and date of the deposit; and

(C)

each transaction concerning the deposit.

(2)

The electric utility shall issue a receipt of deposit to each applicant paying a deposit and shall provide means for a depositor to establish a claim if the receipt is lost.

(3)

A record of each unclaimed deposit must be maintained for at least four years.

(4)

The electric utility shall make a reasonable effort to return unclaimed deposits.

(j)

Guarantees of residential customer accounts.

(1)

A guarantee agreement between an electric utility and a guarantor must be in writing and shall be for no more than the amount of deposit the electric utility would require on the applicant's account pursuant to subsection (f) of this section. The amount of the guarantee shall be clearly indicated in the signed agreement.

(2)

The guarantee shall be voided and returned to the guarantor according to the provisions of subsection (k) of this section.

(3)

Upon default by a residential customer, the guarantor of that customer's account shall be responsible for the unpaid balance of the account only up to the amount agreed to in the written agreement.

(4)

The electric utility shall provide written notification to the guarantor of the customer's default, the amount owed by the guarantor, and the due date for the amount owed.

(A)

The electric utility shall allow the guarantor 16 days from the date of notification to pay the amount owed on the defaulted account. If the 16th day falls on a holiday or weekend, the due date shall be the next workday.

(B)

The electric utility may transfer the amount owed on the defaulted account to the guarantor's own service bill provided the guaranteed amount owed is identified separately on the bill as required by §25.25(c)(10) of this title (relating to the Issuance and Format of Bills).

(5)

The electric utility may disconnect service to the guarantor for nonpayment of the guaranteed amount only if the disconnection was included in the terms of the written agreement, and only after proper notice as described by paragraph (4) of this subsection, and §25.29(b)(5) of this title (relating to Disconnection of Service).

(k)

Refunding deposits and voiding letters of guarantee.

(1)

If service is not connected, or is disconnected, the electric utility shall promptly void and return to the guarantor all letters of guarantee on the account or provide written documentation that the contract has been voided, or refund the customer's deposit plus accrued interest on the balance, if any, in excess of the unpaid bills for service furnished. A transfer of service from one premise to another within the service area of the electric utility is not a disconnection, and no additional deposit may be required.

(2)

When the customer has paid bills for service for 12 consecutive residential billings or for 24 consecutive non-residential billings without having service disconnected for nonpayment of a bill and without having more than two occasions in which a bill was delinquent, and when the customer is not delinquent in the payment of the current bills, the electric utility shall promptly refund the deposit plus accrued interest to the customer, or void and return the guarantee or provide written documentation that the contract has been voided. If the customer does not meet these refund criteria, the deposit and interest or the letter of guarantee may be retained.

(l)

Re-establishment of credit. Every applicant who previously has been a customer of the electric utility and whose service has been disconnected for nonpayment of bills or theft of service (meter tampering or bypassing of meter) shall be required, before service is reconnected, to pay all amounts due the utility or execute a deferred payment agreement, if offered, and reestablish credit. The electric utility must prove the amount of utility service received but not paid for and the reasonableness of any charges for the unpaid service, and any other charges required to be paid as a condition of service restoration.

(m)

Upon sale or transfer of utility or company. Upon the sale or transfer of any electric utility or any of its operating units, the seller shall provide the buyer all required deposit records.

§25.25.Issuance and Format of Bills.

(a)

Frequency of bills. The electric utility shall issue bills monthly, unless otherwise authorized by the commission, or unless service is provided for a period less than one month. Bills shall be issued as promptly as possible after reading meters.

(b)

Billing information. The electric utility shall provide free to the customer a breakdown of charges at the time the service is initially installed or modified and upon request by the customer as well as the applicable rate schedule.

(c)

Bill content. Each customer's bill shall include all the following information:

(1)

if the meter is read by the electric utility, the date and reading of the meter at the beginning and at the end of the billing period;

(2)

the due date of the bill, as specified in §25.28 of this title (relating to Bill Payment and Adjustments);

(3)

the number and kind of units metered;

(4)

the applicable rate schedule and title or code should be provided upon request by the customer;

(5)

the total amount due after addition of any penalty for nonpayment within a designated period. The terms "gross bill" and "net bill" or other similar terms implying the granting of a discount for prompt payment shall be used only when an actual discount for prompt payment is granted. The terms shall not be used when a penalty is added for nonpayment within a designated period;

(6)

the word "Estimated" prominently displayed to identify an estimated bill;

(7)

any conversions from meter reading units to billing units, or any other calculations to determine billing units from recording or other devices, or any other factors used in determining the bill; and

(8)

any amount owed under a written guarantee contract provided the guarantor was previously notified in writing by the electric utility as required by §25.24 of this title (relating to Credit Requirements and Deposits).

(d)

Estimated bills.

(1)

An electric utility may submit estimated bills for good cause provided that an actual meter reading is taken no less than every third month. In months where the meter reader is unable to gain access to the premises to read the meter on regular meter reading trips, or in months when meters are not read, the electric utility must provide the customer with a postcard and request the customer to read the meter and return the card to the electric utility. If the postcard is not received by the electric utility in time for billing, the electric utility may estimate the meter reading and issue a bill.

(2)

If an electric utility has a program in which customers read their own meters and report their usage monthly and no meter reading is submitted by a customer the electric utility may estimate the customer's usage and issue a bill. However, the electric utility must read the meter if the customer does not submit readings for three consecutive months so that a corrected bill may be issued.

(e)

Record retention. Each electric utility shall maintain monthly billing records for each account for at least two years after the date the bill is mailed. The billing records shall contain sufficient data to reconstruct a customer's billing for a given month. Copies of a customer's billing records may be obtained by that customer on request.

(f)

Transfer of delinquent balances. If the customer has an outstanding balance due from another account in the same customer class, then the utility may transfer that balance to the customer's current account. The delinquent balance and specific account shall be identified as such on the bill.

§25.26.Spanish Language Requirements.

(a)

Application. This section applies to each electric utility that serves a county where the number of Spanish speaking persons as defined in §25.5 of this title (relating to Definitions) is 2000 or more according to the most current U.S. Census of Population (Bureau of Census, U.S. Department of Commerce, Census of Population and Housing).

(b)

Written plan.

(1)

Requirement. Each electric utility shall have a commission-approved written plan that describes how a Spanish-speaking person is provided, or will be provided, reasonable access to the utility's programs and services.

(2)

Minimum elements. The written plan required by paragraph (1) of this subsection shall include a clear and concise statement as to how the electric utility is doing or will do the following, for each part of its entire system:

(A)

inform Spanish-speaking applicants how they can get information contained in the utility's plan in the Spanish language;

(B)

inform Spanish-speaking applicants and customers of their rights contained in this subchapter;

(C)

inform Spanish-speaking applicants and customers of new services, discount programs, and promotions;

(D)

allow Spanish-speaking persons to request repair service;

(E)

ballot Spanish-speaking customers for services requiring a vote by ballot;

(F)

allow access by Spanish-speaking customers to services specified in subchapter F of this chapter (relating to Metering);

(G)

inform its service and repair representatives of the requirements of the plan.

§25.28.Bill Payment and Adjustments.

(a)

Bill due date. The bill provided to the customer shall include the payment due date which shall not be less than 16 days after issuance. The issuance date is the postmark date on the envelope or the issuance date on the bill if there is no postmark on the envelope. A payment for electric utility service is delinquent if not received at the electric utility or at the electric utility's authorized payment agency by the close of business on the due date. If the sixteenth day falls on a holiday or weekend, then the due date shall be the next work day after the sixteenth day.

(b)

Penalty on delinquent bills for retail service. A one-time penalty not to exceed 5.0% may be charged on a delinquent commercial or industrial bill. The 5.0% penalty on delinquent bills may not be applied to any balance to which the penalty has already been applied. An electric utility providing any service to the state of Texas shall not assess a fee, penalty, interest, or other charge to the state for delinquent payment of a bill.

(c)

Overbilling. If charges are found to be higher than authorized in the utility's tariffs, then the customer's bill shall be corrected.

(1)

The correction shall be made for the entire period of the overbilling.

(2)

If the utility corrects the overbilling within three billing cycles of the error, it need not pay interest on the amount of the correction.

(3)

If the utility does not correct the overcharge within three billing cycles of the error, it shall pay interest on the amount of the overcharge at the rate set by the commission each year.

(A)

The interest rate shall be based on an average of prime commercial paper rates for the previous 12 months.

(B)

Interest on overcharges that are not adjusted by the electric utility within three billing cycles of the bill in error shall accrue from the date of payment or from the date of the bill in error.

(C)

All interest shall be compounded monthly based on the annual rate.

(D)

Interest shall not apply to leveling plans or estimated billings.

(d)

Underbilling. If charges are found to be lower than authorized by the utility's tariffs, or if the electric utility failed to bill the customer for service, then the customer's bill may be corrected.

(1)

The electric utility may backbill the customer for the amount that was underbilled. The backbilling shall not collect charges that extend more than six months from the date the error was discovered unless the underbilling is a result of theft of service by the customer.

(2)

The electric utility may disconnect service if the customer fails to pay underbilled charges.

(3)

If the underbilling is $50 or more, the electric utility shall offer the customer a deferred payment plan option for the same length of time as that of the underbilling. A deferred payment plan need not be offered to a customer whose underpayment is due to theft of service.

(4)

The utility shall not charge interest on underbilled amounts unless such amounts are found to be the result of theft of service (meter tampering, bypass, or diversion) by the customer, as defined in §25.126 of this title. Interest on underbilled amounts shall be compounded monthly at the annual rate and shall accrue from the day the customer is found to have first stolen (tampered, bypassed or diverted) the service.

(e)

Disputed bills.

(1)

If there is a dispute between a customer and an electric utility about a bill for service, the electric utility shall investigate and report the results to the customer. If the dispute is not resolved, the electric utility shall inform the customer of the complaint procedures of the commission pursuant to §25.30 of this title (relating to Complaints).

(2)

A customer's service shall not be disconnected for nonpayment of the disputed portion of the bill until the dispute is completely resolved by the electric utility.

(3)

If the customer files a complaint with the commission, a customer's service shall not be disconnected for nonpayment of the disputed portion of the bill before the commission completes its informal complaint resolution process and informs the customer of its determination.

(4)

The customer is obligated to pay any billings not disputed.

(f)

Notice of alternate payment programs or payment assistance. When a customer contacts an electric utility and indicates inability to pay a bill or a need for assistance with the bill payment, the electric utility shall inform the customer of all alternative payment and payment assistance programs available from the electric utility, such as deferred payment plans, disconnection moratoriums for the ill, or energy assistance programs, as applicable, and of the eligibility requirements and procedure for applying for each.

(g)

Level and average payment plans. Electric utilities with seasonal usage patterns or seasonal demands are encouraged to offer a level or average payment plan.

(1)

The payment plan may use one of the following methods:

(A)

A level payment plan allowing residential customers to pay one-twelfth of that customer's estimated annual consumption at the appropriate customer class rates each month, with provisions for annual adjustments as may be determined based on actual electric use.

(B)

An average payment plan allowing residential customers to pay one-twelfth of the sum of that customer's current month's consumption plus the previous 11 months consumption (or an estimate, for a new customer) at the appropriate customer class rates each month, plus a portion of any unbilled balance.

(2)

If a customer for electric utility service does not fulfill the terms and obligations of a level payment agreement or an average payment plan, the electric utility shall have the right to disconnect service to that customer pursuant to §25.29 of this title (relating to Disconnection of Service).

(3)

The electric utility may require a customer deposit from all customers entering into level payment plans or average payment plans pursuant to the requirements §25.24 of this title (relating to Credit Requirements and Deposits). The electric utility shall pay interest on the deposit and may retain the deposit for the duration of the level or average payment plan.

(h)

Payment arrangements. A payment arrangement is any agreement between the electric utility and a customer that allows a customer to pay the outstanding bill after its due date but before the due date of the next bill. If the utility issued a disconnection notice before the payment arrangement was made, that disconnection should be suspended until after the due date for the payment arrangement. If a customer does not fulfill the terms of the payment arrangements, the electric utility may disconnect service after the later of the due date for the payment arrangement or the disconnection date indicated in the disconnection notice, pursuant to §25.29 of this title without issuing an additional disconnection notice.

(i)

Deferred payment plans. A deferred payment plan is any written arrangement between the electric utility and a customer that allows a customer to pay an outstanding bill in installments that extend beyond the due date of the next bill. A deferred payment plan may be established in person or by telephone, and all deferred payment plans shall be put in writing.

(1)

The electric utility shall offer a deferred payment plan to any residential customer, including a guarantor of any residential customer, who has expressed an inability to pay all of the bill, if that customer has not been issued more than two disconnection notices during the preceding 12 months.

(2)

Every deferred payment plan shall provide that the delinquent amount may be paid in equal installments lasting at least three billing cycles.

(3)

When a customer has received service from its current electric utility for less than three months, the electric utility is not required to offer a deferred payment plan if the customer lacks:

(A)

sufficient credit; or

(B)

a satisfactory history of payment for service from a previous utility.

(4)

Every deferred payment plan offered by an electric utility:

(A)

shall state, immediately preceding the space provided for the customer's signature and in boldface type no smaller than 14 point size, the following: "If you are not satisfied with this contract, or if agreement was made by telephone and you feel this contract does not reflect your understanding of that agreement, contact the electric utility immediately and do not sign this contract. If you do not contact the electric utility, or if you sign this agreement, you may give up your right to dispute the amount due under the agreement except for the electric utility's failure or refusal to comply with the terms of this agreement." In addition, where the customer and the electric utility representative or agent meet in person, the electric utility representative shall read the preceding statement to the customer. The electric utility shall provide information to the customer in English and Spanish as necessary to make the preceding boldface language understandable to the customer;

(B)

may include a 5.0% penalty for late payment but shall not include a finance charge;

(C)

shall state the length of time covered by the plan;

(D)

shall state the total amount to be paid under the plan;

(E)

shall state the specific amount of each installment;

(F)

shall allow the electric utility to disconnect service if the customer does not fulfill the terms of the deferred payment plan, and shall state the terms for disconnection;

(G)

shall not refuse a customer participation in such a program on the basis of race, color, sex, nationality, religion, or marital status;

(H)

shall be signed by the customer and a copy of the signed plan must be provided to the customer. If the agreement is made over the telephone, then the electric utility shall send a copy of the plan to the customer for signature; and

(I)

shall allow either the customer or the electric utility to initiate a renegotiation of the deferred payment plan if the customer's economic or financial circumstances change substantially during the time of the deferred payment plan.

(5)

An electric utility may disconnect a customer who does not meet the terms of a deferred payment plan. However, the electric utility may not disconnect service until a disconnection notice has been issued to the customer indicating that the customer has not met the terms of the plan. The notice and disconnection shall conform with the disconnection rules in §25.29 of this title. The electric utility may renegotiate the deferred payment plan agreement prior to disconnection. If the customer did not sign the deferred payment plan, and is not otherwise fulfilling the terms of the plan, and the customer was previously provided a disconnection notice for the outstanding amount, no additional disconnection notice shall be required.

§25.29.Disconnection of Service.

(a)

Disconnection policy. If an electric utility chooses to disconnect a customer, it must follow the procedures below, or modify them in ways that are more generous to the customer in terms of the cause for disconnection, the timing of the disconnection notice, and the period between notice and disconnection. Each electric utility is encouraged to develop specific policies for disconnection that treat its customers with dignity and respect its customers' or members' circumstances and payment history, and to implement those policies in ways that are consistent and non-discriminatory. Disconnection is an option allowed by the commission, not a requirement placed upon the utility by the commission.

(b)

Disconnection with notice. Electric utility service may be disconnected after proper notice for any of these reasons:

(1)

failure to pay a bill for electric utility service or make deferred payment arrangements by the date of disconnection;

(2)

failure to comply with the terms of a deferred payment agreement;

(3)

violation of the electric utility's rules on using service in a manner which interferes with the service of others or the operation of nonstandard equipment, if a reasonable attempt has been made to notify the customer and the customer is provided with a reasonable opportunity to remedy the situation;

(4)

failure to pay a deposit as required by §25.24 of this title (relating to Credit Requirements and Deposits); or

(5)

failure of the guarantor to pay the amount guaranteed, when the electric utility has a written agreement, signed by the guarantor, that allows for disconnection of the guarantor's service.

(c)

Disconnection without prior notice. Electric utility service may be disconnected without prior notice for any of the following reasons:

(1)

where a known dangerous condition exists for as long as the condition exists. Where reasonable, given the nature of the hazardous condition, the electric utility shall post a notice of disconnection and the reason for the disconnection at the place of common entry or upon the front door of each affected residential unit as soon as possible after service has been disconnected;

(2)

where service is connected without authority by a person who has not made application for service;

(3)

where service was reconnected without authority after termination for nonpayment; or

(4)

where there has been tampering with the electric utility company's equipment or evidence of theft of service.

(d)

Disconnection prohibited. Electric utility service may not be disconnected for any of the following reasons:

(1)

delinquency in payment for electric utility service by a previous occupant of the premises;

(2)

failure to pay for merchandise, or charges for non-electric utility service, including but not limited to insurance policies or home security systems, provided by the electric utility;

(3)

failure to pay for a different type or class of electric utility service unless charges for such service were included on that account's bill at the time service was initiated;

(4)

failure to pay charges arising from an underbilling, except theft of service, more than six months prior to the current billing;

(5)

failure to pay disputed charges, except for the required average billing payment, until a determination as to the accuracy of the charges has been made by the electric utility or the commission and the customer has been notified of this determination;

(6)

failure to pay charges arising from an underbilling due to any faulty metering, unless the meter has been tampered with or unless such underbilling charges are due under §25.126 of this title (relating to Meter Tampering); or

(7)

failure to pay an estimated bill other than a bill rendered pursuant to an approved meter-reading plan, unless the electric utility is unable to read the meter due to circumstances beyond its control.

(e)

Disconnection on holidays or weekends. Unless a dangerous condition exists or the customer requests disconnection, service shall not be disconnected on holidays or weekends, or the day immediately preceding a holiday or weekend, unless utility personnel are available on those days to take payments and reconnect service.

(f)

Disconnection due to electric utility abandonment. No electric utility may abandon a customer or a certified service area without written notice to its customers and all similar neighboring utilities, and approval from the commission.

(g)

Disconnection of ill and disabled. No electric utility may disconnect service at a permanent, individually metered dwelling unit of a delinquent customer when that customer establishes that disconnection of service will cause some person residing at that residence to become seriously ill or more seriously ill.

(1)

Each time a customer seeks to avoid disconnection of service under this subsection, the customer must accomplish all of the following by the stated date of disconnection:

(A)

have the person's attending physician (for purposes of this subsection, the term "physician" shall mean any public health official, including medical doctors, doctors of osteopathy, nurse practitioners, registered nurses, and any other similar public health official) call or contact the electric utility by the stated date of disconnection;

(B)

have the person's attending physician submit a written statement to the electric utility; and

(C)

enter into a deferred payment plan.

(2)

The prohibition against service termination provided by this subsection shall last 63 days from the issuance of the electric utility bill or a shorter period agreed upon by the electric utility and the customer or physician.

(h)

Disconnection of energy assistance clients. No electric utility may terminate service to a delinquent residential customer for a billing period in which the electric utility receives a pledge, letter of intent, purchase order, or other notification that the energy assistance provider is forwarding sufficient payment to continue service.

(i)

Disconnection during extreme weather. An electric utility cannot disconnect a customer anywhere in its service territory on a day when:

(1)

the previous day's highest temperature did not exceed 32 degrees Fahrenheit, and the temperature is predicted to remain at or below that level for the next 24 hours, according to the nearest National Weather Service (NWS) reports; or

(2)

the NWS issues a heat advisory for any county in the electric utility's service territory, or when such advisory has been issued on any one of the preceding two calendar days.

(j)

Disconnection of master-metered apartments. When a bill for electric utility services is delinquent for a master-metered apartment complex:

(1)

The electric utility shall send a notice to the customer as required in subsection (k) of this section. At the time such notice is issued, the electric utility shall also inform the customer that notice of possible disconnection will be provided to the tenants of the apartment complex in six days if payment is not made before that time.

(2)

At least six days after providing notice to the customer and at least four days before disconnecting, the electric utility shall post a minimum of five notices in conspicuous areas in the corridors or other public places of the apartment complex. Language in the notice shall be in large type and shall read: "Notice to residents of (name and address of apartment complex): Electric utility service to this apartment complex is scheduled for disconnection on (date), because (reason for disconnection)."

(k)

Disconnection notices. Any disconnection notice issued by an electric utility to a customer must:

(1)

not be issued before the first day after the bill is due, to enable the utility to determine whether the payment was received by the due date. Payment of the delinquent bill at the electric utility's authorized payment agency is considered payment to the electric utility.

(2)

be a separate mailing or hand delivered with a stated date of disconnection with the words "disconnection notice" or similar language prominently displayed.

(3)

have a disconnection date that is not a holiday or weekend day, not less than ten days after the notice is issued.

(4)

be in English and in Spanish.

(5)

include a statement notifying the customer that if they need assistance paying their bill by the due date, or are ill and unable to pay their bill, they may be able to make some alternate payment arrangement, establish deferred payment plan, or possibly secure payment assistance. The notice shall also advise the customer to contact the electric utility for more information.

§25.30.Complaints.

(a)

Complaints to the electric utility. A customer or applicant may file a complaint in person, by letter, or by telephone with the electric utility. The electric utility shall promptly investigate and advise the complainant of the results within 21 days.

(b)

Supervisory review by the electric utility. Any electric utility customer or applicant has the right to request a supervisory review if they are not satisfied with the electric utility's response to their complaint.

(1)

If the electric utility is unable to provide a supervisory review immediately following the customer's request, then arrangements for the review shall be made for the earliest possible date.

(2)

Service shall not be disconnected before completion of the review. If the customer chooses not to participate in a review then the company may disconnect service, providing proper notice has been issued under the disconnect procedures in §25.29 of this title (relating to Disconnection of Service).

(3)

The results of the supervisory review must be provided in writing to the customer within ten days of the review, if requested.

(4)

Customers who are dissatisfied with the electric utility's supervisory review must be informed of their right to file a complaint with the commission.

(c)

Complaints to the commission.

(1)

If the complainant is dissatisfied with the results of the electric utility's complaint investigation or supervisory review, the electric utility must advise the complainant of the commission's informal complaint resolution process. The electric utility must also provide the customer the following contact information for the commission: Public Utility Commission of Texas, Office of Customer Protection, P.O. Box 13326, Austin, Texas 78711-3326, (512)936-7120 or in Texas (toll-free) 1-888-782-8477, fax (512)936-7003, e-mail address: customer@puc.state.tx.us, internet address: www.puc.state.tx.us, TTY (512)936- 7136, and Relay Texas (toll-free) 1-800-735-2989.

(2)

The electric utility shall investigate all complaints and advise the commission in writing of the results of the investigation within 21 days after the complaint is forwarded to the electric utility.

(3)

The electric utility shall keep a record for two years after determination by the commission of all complaints forwarded to it by the commission. This record shall show the name and address of the complainant, the date, nature and adjustment or disposition of the complaint. Protests regarding commission- approved rates or charges which require no further action by the electric utility need not be recorded.

§25.31.Information to Applicants and Customers.

(a)

Information to applicants. Each electric utility shall provide this information to applicants when they request new service or transfer existing service to a new location:

(1)

the electric utility's lowest-priced alternatives available at the applicant's location, The information shall begin with the lowest-priced alternative and give full consideration to applicable equipment options and installation charges;

(2)

the electric utility's alternate rate schedules and options, including time of use rates and renewable energy tariffs if available; and

(3)

the customer information packet described in subsection (c) of this section. This is not required for the transfer of existing service.

(b)

Information regarding rate schedules and classifications and electric utility facilities.

(1)

Each utility shall notify customers affected by a change in rates or schedule of classifications.

(2)

Each electric utility shall maintain copies of its rate schedules and rules in each office where applications are received.

(3)

Each electric utility shall post a notice in a conspicuous place in each office where applications are received, informing the public that copies of the rate schedules and rules relating to the service of the electric utility, as filed with the commission, are available for inspection.

(4)

Each electric utility shall maintain a current set of maps showing the physical locations of its facilities that includes an accurate description of all facilities (substations, transmission lines, etc.). These maps shall be kept by the electric utility in a central location and will be available for commission inspection during normal working hours. Each business office or service center shall have available up-to-date maps, plans, or records of its immediate service area, with other information as may be necessary to enable the electric utility to advise applicants, and others entitled to the information, about the facilities serving that locality.

(c)

Customer information packets.

(1)

The information packet shall be entitled "Your Rights as a Customer". Cooperatives may use the title, "Your Rights as a Member".

(2)

The information packet, containing the information required by this section, shall be mailed to all customers on at least every other year at no charge to the customer.

(3)

The information shall be written in plain, non-technical language.

(4)

The information shall be provided in English and Spanish; however, an electric utility is exempt from the Spanish language requirement if 10% or fewer of its customers are exclusively Spanish-speaking. If the utility is exempt from the Spanish language requirement, it shall notify all customers through a statement in both English and Spanish, in the packet, that the information is available in Spanish from the electric utility, both by mail and at the electric utility's offices.

(5)

The information packet shall include all of the following:

(A)

the customer's right to information concerning rates and services and the customer's right to inspect or obtain at reproduction cost a copy of the applicable tariffs and service rules;

(B)

the electric utility's credit requirements and the circumstances under which a deposit or an additional deposit may be required, how a deposit is calculated, the interest paid on deposits, and the time frame and requirement for return of the deposit to the customer;

(C)

the time allowed to pay outstanding bills;

(D)

grounds for disconnection of service;

(E)

the steps that must be taken before an electric utility may disconnect service;

(F)

the steps for resolving billing disputes with the electric utility and how disputes affect disconnection of service;

(G)

information on alternative payment plans offered by the electric utility, including, but not limited to, deferred payment plans, level billing programs, average payment plans, as well as a statement that a customer has the right to request these alternative payment plans;

(H)

the steps necessary to have service reconnected after involuntary disconnection;

(I)

the customer's right to file a complaint with the electric utility, the procedures for a supervisory review, and right to file a complaint with the commission, regarding any matter concerning the electric utility's service. The commission's contact information: Public Utility Commission of Texas, Office of Customer Protection, P.O. Box 13326, Austin, Texas 78711-3326, (512) 936-7120 or in Texas (toll-free) 1-888-782-8477, fax (512) 936-7003, e-mail address: customer@puc.state.tx.us, internet address: www.puc.state.tx.us, TTY (512) 936-7136, and Relay Texas (toll- free) 1-800-735-2989, shall accompany this information;

(J)

the hours, addresses, and telephone numbers of electric utility offices and any authorized locations where bills may be paid and information may be obtained or a toll-free telephone number that would provide the customer with this information;

(K)

a toll-free telephone number or the equivalent (such as WATS or collect calls) where customers may call to report service problems or make billing inquiries;

(L)

a statement that electric utility services are provided without discrimination as to a customer's race, color, sex, nationality, religion, or marital status, and a summary of the company's policy regarding the provision of credit history based upon the credit history of a customer's former spouse;

(M)

notice of any special services such as readers or notices in Braille, if available, and the telephone number of the text telephone for the deaf at the commission;

(N)

how customers with physical disabilities, and those who care for them, can identify themselves to the electric utility so that special action can be taken to inform these persons of their rights.

(O)

the customer's right to have his or her meter tested without charge under §25.124 of this title (relating to Meter Testing);

(P)

the customer's right to be instructed by the utility how to read his or her meter, if applicable;

(Q)

a statement that funded financial assistance may be available for persons in need of assistance with their electric utility payments, and that additional information may be obtained by contacting the local office of the electric utility, Texas Department of Housing and Community Affairs, or the Public Utility Commission of Texas. The main office telephone number (toll-free number, if available) and address for each state agency shall also be provided; and

(R)

information that explains how a residential customer can be recognized as a critical load customer, the benefits of being a critical load customer in an emergency situation, and the process for being placed on the critical load list. For the purposes of this section a "critical load residential customer" shall be defined as a residential customer who has a critical need for electric service because a resident on the premises requires electric service to maintain life.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 16, 1999.

TRD-9902219

Rhonda Dempsey

Rules Coordinator

Public Utility Commission of Texas

Effective date: May 6, 1999

Proposal publication date: December 11, 1998

For further information, please call: (512) 936-7308


Chapter 26. Substantive Rules Applicable to Telecommunications Service Providers

Subchapter B. Customer Service and Protection

16 TAC §§26.21-26.31

The Public Utility Commission of Texas (the commission) adopts new §26.21, relating to General Provisions of Customer Service and Protection Rules; new §26.22, relating to Request for Service; new §26.23, relating to Refusal of Service; new §26.24, relating to Credit Requirements and Deposits; new §26.25, relating to Issuance and Format of Bills; new §26.26, relating to Spanish Language Requirements; new §26.27, relating to Bill Payment and Adjustments; new §26.28, relating to Suspension or Disconnection of Service; new §26.29, relating to Prepaid Local Telephone Service (PLTS); new §26.30, relating to Complaints; and new §26.31, relating to Information to Applicants and Customers with changes to the proposed text as published in the December 11, 1998 Texas Register (23 TexReg 12584). These sections are adopted under Project Number 19517.

New §26.21 presents specific definitions for "customers," "applicants," and "days," and establishes that the purpose of the customer service and protection rules is to set a minimum standard for the provision of utility service. New §26.21 also provides that utilities may adopt less restrictive standards for differing groups of customers as long as they do not discriminate against protected groups. New §26.22 replaces §23.44(d) of this title (relating to New Construction). New §26.23 replaces §23.42 of this title (relating to Refusal of Service). New §26.24 replaces §23.43 of this title (relating to Applicant and Customer Deposit). New §26.25 replaces §23.45(a), (b), (c), and (e) of this title (relating to Billing). New §26.26 replaces §23.6 of this title (relating to Spanish Language Requirements). New §26.27 replaces §23.45(k), (l), (n), (o), and (p) of this title (relating to Billing). New §26.28 replaces §23.46 of this title (relating to Discontinuance of Service). New §26.29 replaces §23.40 of this title (relating to Prepaid Local Telephone Service). New §26.30 replaces §23.41(c) of this title (relating to Customer Relations). New §26.31 replaces §23.41(a) and (b) of this title (relating to Customer Relations).

The Appropriations Act of 1997, House Bill 1, Article IX, §167 (§167) requires that each state agency review and consider for readoption each rule adopted by that agency pursuant to the Government Code, Chapter 2001 (Administrative Procedure Act). Such reviews shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist. The commission held three workshops to conduct a preliminary review of its rules. As a result of these workshops, the commission is reorganizing its current substantive rules located in 16 Texas Administrative Code (TAC), Chapter 23, to (1) satisfy the requirements of Section 167; (2) repeal rules no longer needed; (3) update existing rules to reflect changes in the industries regulated by the commission; (4) do clean-up amendments made necessary by changes in law and commission organizational structure and practices; (5) reorganize rules into new chapters to facilitate future amendments and provide room for expansion; and (6) reorganize the rules according to the industry to which they apply. Chapter 26 has been established for all commission substantive rules applicable to telecommunications service providers. The duplicative sections of Chapter 23 are proposed for repeal as each new section is proposed for publication in the new chapter. No one commented on the Section 167 requirement as to whether the reason for adopting rules continue to exist. The commission finds that the reason for adopting these rules continues to exist.

The commission specifically requested comments on whether the commission should change the provisions of §26.25(c)(4) to require more customer-friendly presentations of telephone bills and, if so, to suggest changes.

The commission received written comments on the proposed rules from seven Public Interest (PI) groups (joint comments for Consumers Union (CU) Southwest Regional Office, Texas Ratepayers' Organization to Save Energy (ROSE), Texas Legal Services Center, Public Citizen, Texas Office, Gray Panthers, Texas, Texas Citizen Action, and Texas Alliance for Human Needs); GTE Southwest, Inc. (GTE); AT&T Communications of the Southwest, Inc. (AT&T); the Office of Public Utility Counsel (OPC); Southwestern Bell Telephone Company (SWB); Texas Statewide Telephone Cooperative, Inc. (TSTCI); Texas Association of Long Distance Telephone Companies (TEXALTEL); and Texas Telephone Association (TTA). The commission also received reply comments from AT&T, TSTCI, GTE, PI, and the Center for Economic Justice (CEJ).

A public hearing on the proposed rules was held at the commission offices on February 9, 1999, at 9:00 a.m. Representatives from the South Plains Community Action Agency (SPCAA), Texas Legal Services Center, Texas ROSE, SWB, and TTA offered oral comments at the public hearing. Also attending the pubic hearing were representatives from OPC, GTE, GVNW, Inc., Sprint, UDP, Inc., CU, AT&T, TSTCI, Big Bend Telephone Company, and Eastex Telephone Cooperative, Inc.

Major issues

The telecommunications industry commenters strongly opposed the proposed rule changes that would sever the link between local telephone service and unrelated charges including long distance charges. The proposed rules would allow disconnection of local service for nonpayment of local services charges only (§26.28(d)(1)), prohibit refusal of service for failure to pay anything other than local telephone service (§26.23(c)(2)), and require that the deposit amount be based on local service charges only (§26.24(f)(1)). Most of the telecommunications industry commenters indicated that the commission has reviewed the policy that permits consideration of long distance charges in initiation of service, deposits, and disconnection practices on several occasions in recent years and has not changed existing policy. The commission declined to prohibit disconnections of local service because of nonpayment of long distance charges and instead created Prepaid Local Telecommunications Service (PLTS) (§23.40). Commenters fear the proposed rule changes would destroy the balance of interests carefully crafted by the commission in creating PLTS. They believe there is no basis for changing a policy in existence since the creation of the commission in 1975.

SWB, GTE, and TSTCI commented that the proposed changes unfairly single out the incumbent local exchange companies (ILECs) for additional regulation that increases costs, does not ensure affordable basic telephone service in a competitively neutral manner, and does not foster market competition. The commenters indicated that the proposed rule changes would result in inherent competitive inequalities since they apply to an ILEC but not to a competitive local exchange company (CLEC). The commenters suggested that the commission should hold the rule changes in abeyance and convene a workshop with industry representatives to specifically address this issue. SWB commented that the proposed rule changes would be a contravention of the Public Utilities Regulatory Act (PURA) §58.025, which precludes changes to the "rates" of a utility that elects incentive regulation. SWB stated that the term "rates" is broadly defined in PURA §11.003(15) to include any rule, practice, or contract affecting such compensation, tariff, etc.

GTE stated that the proposed rule changes are sweeping in nature and would require costly and inefficient modifications to billing and customer service automated systems. SWB indicated that difficulties in making the necessary systems modifications would be further compounded by the Y2K problem. GTE further commented that the proposed changes would harm customers by increasing bad debts that will be borne by all ratepayers and increase pressure to shift billing and collection to unregulated third parties.

AT&T and TEXALTEL commented that long distance companies are dependent on LECs for billing casual calls (i.e., dial around and collect calls) and that the expense of collecting these charges by means other than the LEC is prohibitive. AT&T commented that in Project Number 12334 it was noted that prohibiting disconnection of local service for nonpayment of long distance charges would increase uncollectible expenses by $134-$179 million per year.

PI commented that the proposed rule changes represent a significant improvement in customer protection by prohibiting disconnection of local service for nonpayment of unrelated charges and will put customers on an equal footing with slammers and crammers. OPC supported the PI position and recommended that utilities be required to inform the public of the new commission policy on disconnections. CEJ provided comments indicating that the current disconnection policy has no legal basis. In their reply comments, AT&T and GTE disagreed with PI that these proposed changes will improve the situation for slamming and cramming since the commission has separate rules that address those problems. TSTCI stated that the PLTS rule addresses the concerns of PI.

The commission agrees that it is appropriate to monitor the effectiveness of PLTS over a longer period of time and has asked LECs to submit information on PLTS usage. It also notes that cramming complaints have decreased, at least temporarily, because of actions taken by the LECs against problem billing and collection clients. Therefore, the commission does not adopt the proposed rule changes and retains the current policy on disconnections, referrals of service, and deposits. Proposed §26.28(d)(1), §26.23(c)(2), and §26.24(f)(1) are modified accordingly. However, the commission will monitor PLTS as well as changes in the industry and may revisit this issue in the future.

SWB commented that 35% of its customers pay late and that a late payment fee for residential service is needed. GTE agreed with SWB stating that a late payment penalty is necessary, permissible, and timely. PI and CEJ strongly opposed a late payment penalty for residential service. PI commented that there is no cost basis for imposing a penalty and that it would be contrary to the law governing electing LECs. The expenses of billing and collection are already included in the basic local telecommunications service rates, which are capped for electing companies. This would result in excess profits for dominant carriers. PI further stated that this would provide greater incentive to impose fees rather than work with the customers experiencing bill payment problems. CEJ commented that the 5.0% late pay fee on deferred payment plans should be applied only to basic local telephone service.

The commission agrees with the arguments against permitting a late payment penalty for residential service and retains the current policy that allows a late payment penalty only for non- residential service. Accordingly, §26.27(b) is revised to reflect this change to the proposed rule.

Other issues

§26.21. General Provisions of Customer Service and Protection Rules.

SWB recommended adding "former customer" to the definition for "Applicant" in subsection (c)(1). TEXALTEL recommended deleting "for the first time or reapplies" from the definition for "Applicant." The commission agrees that the definition requires clarification and revised it as follows: "Applicant - A person who applies for service for the first time or reapplies after disconnection of service."

§26.22. Request for Service.

SWB recommended deleting the requirement to inform applicants as part of the initial contact about the right to file a complaint with the commission (§26.22(7)). SWB commented that this information is already required in §26.31(c), "Your Rights as a Customer," that requiring this information during the initial contact would not leave a positive impression on many applicants and that it would leave the impression that an ILEC offers an inferior service since a CLEC is not required to "warn" a prospective customer. PI stated that it is a benefit to all residential ratepayers to be informed of the commission's role in customer protection. It further stated that the rule could benefit applicants without being a detriment to utility operations by including a simple statement (e.g., "If you think you have been treated unfairly, you have the right to file a complaint with the PUC.")

The commission believes that the utility should provide the applicant a copy of the "Your Rights as a Customer" brochure and inform the applicant of the complaint process if the applicant thinks the applicant has been treated unfairly and revises proposed §26.22(7) accordingly.

§26.23. Refusal of Service.

TTA recommended adding the language in the current §23.42(b) to §26.23(a) indicating that a utility may decline to provide service until the applicant complies with state and municipal regulations and the utility's rules and regulations on file with the commission. The commission agrees with this recommendation and revises §26.23(a) accordingly.

TEXALTEL suggested adding to §26.23(a)(3) that the guarantee complied with the commission's rules at the time it was executed. The commission believes that the suggested change is unnecessary.

SWB recommended a minor change to §26.23(a)(4) by replacing "another customer" with "a customer." SWB stated that sometimes the same customer applies under another name and that the proposed change would preclude an applicant with the intent to deceive from arguing that the rule did not apply to him or her. The commission believes that clarification is required. §26.23(a)(4) is revised to clearly state that service may be refused if there is a change of applicant or customer identity to avoid or evade payment of a utility bill. The commission also adds §26.23(c)(4) to indicate that service shall not be refused for failure to pay the bill of another customer at the same address except where the change in identity is made to avoid or evade payment of a utility bill.

As previously discussed, the telecommunications industry strongly opposed proposed rule §26.23(c)(2), which would prohibit refusal of service for failure to pay for anything other than local telephone service. The commission revises §26.23(c)(2) to indicate that refusal of service is prohibited for failure to pay for any charges that are not in a utility's tariffs.

§26.24. Credit Requirements and Deposits.

PI supported the provision in §26.24(a)(1)(B), which replaces "reasonable time" in the current §23.43(b)(1) with a 12-month period for application of credit histories of former spouses. PI indicated that the change makes the standard clear for both the customer and the utility. SWB recommended deleting §26.23(a)(1)(B), stating that the rights of spouses before or after divorce should be left to the courts and that the complaint process should be used to handle credit history disputes. TTA stated that the reference to "shared service" in the current §23.43(b)(1) was omitted from proposed §26.24(a)(1)(B) and that without this reference the rule could lead to inequitable results. The commission agrees with TTA that "shared service" should be added to §26.24(a)(1)(B) and revises the rule accordingly.

GTE commented that proposed §26.24(a)(2) requires clarification to ensure the application of credit criteria is clearly stated. The commission revises §26.24(a)(2) to delete the word "any."

Proposed §26.24(a)(2)(A)(iii) included the phrase, "during the last 12 consecutive months of service was not late in paying a bill." This language is inconsistent with that in the current §23.43(b)(3)(A). The commission did not intend to change the current credit requirements for residential applicants by requiring a perfect payment record. The commission revises that part of §26.24(a)(2)(A)(iii) as follows: "...during the last 12 consecutive months of service was not late in paying a bill more than once."

Proposed §26.24(a)(2)(A)(v) required that a residential applicant obtain a letter of credit history from the applicant's previous utility. GTE recommended deleting this requirement, stating that it is was ambiguous, redundant, and impractical. GTE further commented that if the other four criteria were met, a utility letter of credit was unnecessary. GTE also expressed concern that many utilities will not provide such letters due to issues of confidentiality. The commission agrees that obtaining a letter of credit history from the applicant's previous utility should not be a requirement for establishing credit. However, instead of deleting §26.24(a)(2)(A)(v), the commission maintains its existing rule language indicating that applicants are encouraged to obtain a letter of credit history from their previous utility, and utilities are encouraged to provide such information with final bills.

GTE commented that §26.24(c)(2) should be for residential customers only and that this rule conflicts with §26.24(b). The commission does not agree with GTE. The provisions of §26.24(c)(2) may be used to require an initial deposit from a residential or commercial customer. Furthermore, §26.24(c)(2) is not in conflict with §26.24(b) since §26.24(c)(2) applies to existing customers while §26.24(b) applies to non-residential applicants.

SWB proposed deleting the 12-month limitation from all of the provisions for requesting additional deposits in §26.24(d)(1), stating that the limitation is arbitrary. The commission believes that the 12-month limitation should apply to the provisions of §26.24(d)(1)(A), but should not apply to the provisions of §26.24(d)(1)(B). The provisions of §26.24(d)(1)(A) may be used to require an additional deposit based exclusively on increased usage and should be limited to the first 12 months of service. The provisions of §26.24(d)(1)(B) may be used to require an additional deposit based on increased usage and poor payment history and should not be limited to the first 12 months of service. The commission revises §26.24(d)(1) and §26.24(d)(1)(A) accordingly.

GTE commented that the proposed rule bifurcated the provisions of additional deposits between residential and business customers, but that the disconnection provision was omitted from the business section. GTE recommended that the language in §26.24(d)(1)(E) should be duplicated as a new provision, §26.24(d)(2)(C). The commission agrees that the disconnection provision should also apply to additional deposits for non-residential service and adopts the change recommended by GTE.

The telecommunications industry strongly opposed the provision in §26.24(f)(1) that the determination of the deposit amount shall be based only on charges related to local telephone service. GTE stated that this provision would create a major problem for business accounts. TSTCI commented that this provision would have an adverse impact on small companies. The commenters recommended that long distance charges be allowed in calculating a deposit amount when the LEC's tariff provides for billing for the interexchange carrier. The commission revises §26.24(f)(1) based on the language in the current §23.43(e)(1) as indicated in the previous discussion about local service and long distance charges.

SWB recommended deleting §26.24(f)(2), which states that in determining the amount of the deposit, no revenue from estimated telephone directory advertising may be used. The commission agrees that there is no need to identify one specific charge that is not allowed and revises proposed §26.24(f)(2) to indicate that no revenue from non-tariffed products or services may be used to determine the deposit amount.

SWB also suggested eliminating §26.24(h), which requires the utility to provide written information to customers about deposits when a deposit is required. SWB stated that deposit information is already included in the "Your Rights as a Customer" information. The commission agrees in part and revises the rule to require that this brochure be given to the customer to explain the deposit.

TTA recommended that §26.24(i)(4) be updated to indicate that certain unclaimed monies go to a scholarship fund and not to the Office of Comptroller of Public Accounts. The commission deletes the escheat provision in §26.24(i)(4).

§26.24(j)(4)(A) states that the utility shall allow a guarantor 16 days from the date of notification to pay the amount owed on a defaulted account. If the sixteenth day falls on a holiday or weekend, the due date shall be the next workday. GTE commented that its billing systems cannot modify the due date to exclude holidays and weekends. GTE recommended deleting the requirement to modify the due date. The commission does not agree with GTE. The guarantor is entitled to know the actual due date when payment is required, and the utility should ensure that the actual date appears in the notice to the guarantor.

§26.25. Issuance and Format of Bills.

PI commented that the FCC is currently reviewing the form and content of telecommunications bills (CC Docket Number 98-170). PI added that confusion over telephone bills contributes to the growth in telecommunications fraud, such as slamming and cramming. PI recommended the following minimum information be required on a customer's telecommunications bill: (1) current service recapitulation; (2) conspicuous notice of any change in services or providers; (3) bills organized by provider; (4) services not related to local or pre- subscribed long distance have disclosures mandated by the revised Telephone Disclosure and Dispute Resolution Act (TDDRA '92); and (5) identify explicitly both services rendered and the service providers.

TTA commended the commission's efforts to encourage clear and understandable telephone bills. However, TTA believes it is premature to overhaul the billing process without an opportunity for the industry to work through the difficulties in amending the industry's billing system. TTA is concerned that there could be serious and unintended consequences. TTA recommended that this rule-making be held in abeyance for more input from the public and the industry. GTE urged that the commission seek more information from the industry on the potential ramifications of any additional proposals related to billing format and content. GTE commented that bill format and content options can be a competitive differentiator in the marketplace and urged the commission not to over-regulate the process.

TTA suggested that an industry analysis may be appropriate to determine whether a substantial modification of industry billing systems would be required to post actual due dates on bills as required by proposed §26.25(c)(4)(B).

GTE and TTA recommended modifying "collected from all customers" in proposed §26.25(c)(4)(G) since some charges do not apply to all customers. GTE and TTA objected to the requirement in proposed §26.25(c)(4)(K) that each bill concisely state the nature or purpose of the tax, fee, or charge if not immediately obvious. GTE commented that this requirement is ambiguous and, if implemented, would actually increase customer confusion. GTE stated that line items on a bill are limited by the number of characters that can be used. GTE further indicated that explanations of particularly critical surcharges are often accompanied by required bill messages for a period of time to educate customers (e.g., Texas USF).

Proposed §26.25(c)(4)(G) clarifies current §23.45(g)(1)(B)(vii) by requiring a separate line item on a bill for only those charges mandated by a governmental agency that are to be specifically collected from customers (e.g., subscriber line charge). There is no legal requirement to specifically charge customers for many separately listed items currently being collected from customers (e.g., federal universal service, number portability, and Telecommunications Infrastructure Fund Assessment). The commission revises proposed §§26.25(c)(4)(G) and 26.25(c)(4)(K) based on the comments provided by the parties. The commission believes it should not make any other changes to the bill format and content until the FCC completes its review or the commission conducts an in-depth analysis.

§26.26. Spanish Language Requirements.

PI recommended that proposed §26.26(a) be updated to refer to the most current U.S. Census rather than the 1990 Census. The commission agrees and revises §26.26(a) accordingly.

§26.27. Bill Payment and Adjustments.

PI suggested reinstating the language in the current §23.45(b) in proposed §26.27(a), indicating that the date of issuance is the postmark on the envelope or the issuance date on the bill if there is no postmark on the envelope. GTE, TTA, and AT&T commented that billing systems are unable to adjust the due date on bills to exclude holidays and weekends. They recommended modifying proposed §26.27(a) to indicate that if the sixteenth day falls on a holiday or weekend, an allowance should be made for payments to be received the next workday.

The commission agrees with the recommendation to add language about the issuance date in §26.27(a). The commission does not agree with modifying the rule with regard to the due date on the bill. The customer is entitled to know the actual date that payment is due. The commission further notes that the requirement to show the actual due date on the bill is not new. The new §26.27(a) more clearly states the requirement that was already in the current §23.45(b).

SWB recommended limiting overbilling corrections to four years in §26.27(d)(1). SWB commented that the purpose of their proposed change was to restore symmetry between the overbilling and underbilling subsections of the rule and to be consistent with the general statute of limitations on civil actions in Texas. PI disagreed with limiting rate adjustments to customers to four years. Since it is the utility and not the customer who is at fault, the utility should fully compensate the customer. The commission believes that a customer should be fully compensated for any overbilling charges. Thus, no change is made to §26.27(d)(1).

GTE and TTA recommended using the language in current §23.45(h) in §26.27(e)(1) that would allow backbilling for more than six months. SWB recommended allowing backbilling for up to 12 months. SWB stated again that the purpose for this change was to restore symmetry between the overbilling and underbilling subsections of the rule. PI opposed extending the time period for backbilling, stating that customers deserve accurate bills and allowing extended backbilling does not provide the proper incentive to companies to control the quality of their operations.

The commission adopts the six-month limit on backbilling as stated in §26.27(e)(1). Since undercharges are the result of a utility error, a six-month limit is reasonable. The commission notes that while the current §23.45(h) allowed backbilling for more than six months, the rule also prohibited disconnection of service for nonpayment of underbilled charges that exceeded six months.

SWB recommended deleting "that is the result of theft of service" from proposed §26.27(e)(2) since there is no basis for limiting disconnection of service to the context of theft of service. The commission did not intend to limit disconnection to theft of service and revises §26.27(e)(2) accordingly.

PI commented that there appears to be a gap in proposed §26.27(f)(2) that may allow a disconnection of service during the time between when the utility notifies the customer of the outcome of its investigation and the time the customer files a complaint with the commission. GTE, TSTCI, and TTA expressed concern that proposed §26.27(f)(2) omits the language in current §23.45(j)(3), which allows disconnection for nonpayment of disputed bills after 60 days. The commenters stated that without the 60-day limit disputes could be prolonged, and there would not be an obligation on the customer and the commission to pursue a quick solution. TSTCI recommended reinstating the language in current §23.45(j)(3) in proposed §26.27(f)(2) that the customer is obligated to pay the undisputed amount.

The commission makes several revisions to the paragraphs in §26.27(f) to differentiate between utility disputes and commission complaints and to clearly indicate that the customer is obligated to pay the undisputed portion of the bill. However, the commission does not agree with imposing a 60-day limit on the disconnection moratorium pending dispute resolution. The commission expects that the vast majority of disputes will be resolved within 60 days. In those few cases that require additional time, it would not be appropriate to disconnect service until there is a final resolution of the dispute. The commission does not believe that lifting the 60-day limit will provide an incentive to prolong the dispute resolution process. It may well have the opposite effect.

Proposed §26.27(f)(3) stated that service shall not be disconnected for nonpayment of disputed charges not related to local service. GTE, TSTCI, and TEXALTEL recommended deleting proposed §26.27(f)(3) since §26.27(f)(2) already prohibits disconnection for any disputed charges. The commission agrees and replaces the proposed §26.27(f)(3) with clarifying language.

PI supported the requirement in §26.27(i) that deferred payment plans must be in writing. GTE and TTA objected to this requirement stating that this would result in an administrative nightmare. GTE recommended that deferred payment plans should be in writing only upon customer request. AT&T urged the commission to continue the current practice of allowing oral deferred payment plans.

The commission is convinced that deferred payment plans should be in writing. This is not a new requirement. The current §23.45(d)(7) required that deferred payment plans be in writing whether the agreement was reached at the utility's business office or by phone. The commission does not require that every payment agreement between a customer and the utility be in writing. Payment arrangements that permit payment of a bill sometime before the due date of the next bill do not have to be in writing (§26.27(h)). An agreement calling for installment payments qualifies as a deferred payment plan and must be in writing.

GTE proposed changing "customer" to "residential customer" in proposed §26.27(i)(3). Since the deferred payment plan provisions apply only to residential service, the commission agrees with GTE and revises §26.27(i)(3) accordingly.

§26.28. Suspension or Disconnection of Service.

PI strongly agreed with the statement in §26.28(a) that disconnection is an option and not a requirement.

TSTCI proposed adding a provision under §26.28(c) that would allow disconnection without notice when there is an intent to deceive by a customer. TSTCI recommended using similar language to that used for refusal of service to applicants in §26.23(a)(4). TSTCI cited a situation where a customer used a false name to obtain service and the utility found this out after providing service. TSTCI stated that in this situation the utility should be allowed to disconnect service without notice.

The commission does not agree that an additional provision under §26.28(c) is required. The situation cited by TSTCI can be remedied by immediately issuing a disconnection notice to the customer. If the customer does not pay the outstanding amount owed within 10 days, then the customer's service may be disconnected.

SWB recommended changing §26.28(d)(3) to prohibit disconnection of service for failure to pay an underbilling exceeding 12 months instead of six months. The commission does not agree with the proposed change. As previously discussed, a six-month period for backbilling is reasonable and should not be extended.

SWB recommended placing a 45-day limit on the disconnection prohibition for disputed charges. The commission does not believe an arbitrary time period should be adopted. There should be no disconnection for disputed charges until a final determination is made on the accuracy of the charges.

TEXALTEL proposed modifying §26.28(g) to allow toll blocking and other sensitive usage blocking in conjunction with the disconnection prohibition for ill and disabled customers. The commission does not agree that the proposed change is necessary.

Because local telephone service is a necessity to many persons with health problems, a new requirement, §26.28(g), adds a disconnection exemption for the ill and disabled which mirrors the exemption for customers of electric utilities. PI recommended amending §26.28(g)(2) to allow more than 63 days for the ill and disabled disconnection prohibition and to require the utility to refer the customer to health and human service providers. GTE opposed both proposed changes. The commission believes the provisions in §26.28(g) for the ill and disabled provide sufficient safeguards and do not require modification.

SWB proposed adding the language in §26.28(e) to §26.28(h)(3) and amending §26.28(h)(4) to state that the Spanish language requirement on a disconnection notice would apply only if the customer has a Spanish surname. The commission does not believe either proposal is appropriate.

§26.29. Prepaid Local Telephone Service (PLTS).

SWB proposed amending §26.29(e)(4) to allow a utility to require in a deferred payment plan any charges under the utility's tariff including long distance charges. The commission does not agree with changing the current PLTS provision that limits charges that may be included in a deferred payment plan to local basic service.

GTE recommended replacing "for these reasons" with "for any of the following reasons" in proposed §26.29(e)(6)(A) and adding "as stated in those tariffs" to proposed §26.29(h)(1)(A). The commission agrees with both clarifications and amends the rules accordingly.

§26.30. Complaints.

GTE, SWB, TSTCI, TTA, and AT&T commented that the requirement in proposed §26.30(a) that the utility complete an investigation of a customer complaint within 15 calendar days is unreasonable. The commenters stated that additional time is required to contact the customer and to make a correct determination on the merits of the complaint. TSTCI stated that the required time frame is particularly difficult for small companies with limited staff. GTE proposed the rule be amended to allow 20 workdays. SWB, TSTCI, and TTA proposed the rule allow 30 calendar days to complete an investigation. SWB also proposed amending §26.30(a) to replace "complaint" with "complaint regarding the accuracy of his/her monthly bill."

The commission believes that while most complaints can be resolved within 15 calendar days, additional time is required for others. The commission amends proposed §26.30(a) to state that the utility shall investigate and advise the complainant of the results within 21 calendar days. The commission does not agree with the proposal to limit complaints to those related to billing accuracy.

GTE and SWB commented that the requirement in §26.30(c)(2) that the utility complete an investigation of a commission complaint within 15 calendar days is unreasonable. GTE proposed amending §26.30(c)(2) to allow 20 workdays to resolve complaints filed with the commission. SWB recommended retaining the 30-day period for investigating commission complaints. SWB indicated that if the commission shortens the time limit for the utility to respond to a complaint, then it proposed the time limit be changed to 15 business days rather than 15 calendar days. SWB also recommended adding to the rule that upon receipt of the utility's response, the commission shall issue its written analysis of the complaint within 15 calendar days.

The Legislature places a high value on prompt resolution of complaints as evidenced by a commission performance measure. Also, electronic communication should shorten the time for sending complaints and receiving responses. Therefore, the commission extends the time allowed for a utility investigation of a commission complaint from 15 calendar days to 21 calendar days.

§26.31. Information to Applicants and Customers.

PI proposed amending §26.31(a)(1) to require utilities to describe any options using standardized terms and pricing to enable consumers to easily compare. In its reply comments, GTE opposed PI's recommendation, contending that this would result in micro-management of utilities' business practices. GTE further indicated that proposed §26.31 and current §23.41(b) already provide extensive detail on the manner and scope of customer communications and additional requirements are unnecessary and contrary to the spirit of a competitive marketplace. The commission does not believe that it would be appropriate at this time to require standardized terms and pricing because of other truth-in-billing efforts underway.

Section 26.31(b)(2) requires each utility to maintain copies of its rates and tariff in each office where applications are received. SWB commented that the rule would impose unreasonable costs and burdens and recommended replacing "each office" with "at least one office per exchange." The commission does not agree that the proposed amendment is necessary. The requirement in §26.31(b)(2) is not new; it is currently in §23.41(b)(4).

All comments, including any not specifically referenced herein, were fully considered by the commission. Where appropriate, non-substantive clarifications identified in Project Number 19513, Transfer of Existing Electric Utility Customer Service and Protection Rules to New Chapter 25 and Associated Changes are applied to these rules. The commission also makes other minor changes for clarification.

AT&T recommended several changes to the preamble to more accurately reflect the commission's statutory authority. The commission made appropriate revisions to the preamble.

These new sections are adopted under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 1998) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction, and specifically, §§52.002, 52.102, and 52.152 which allow the commission to regulate telecommunication utility operations and services; §52.109 which grants the commission authority to require a telecommunications utility to make service available within a reasonable time after receipt of a bona fide request for service; §53.001 which authorizes the commission to establish and regulate rates of a public utility; §54.101 and §54.151 which require certificate holders to provide continuous and adequate service in their service areas; §55.001 which requires public utilities to furnish service, instrumentalities, and facilities that are safe, adequate, efficient, and reasonable; §55.002 which grants the commission authority to adopt just and reasonable standards, classifications, rules, or practices a public utility must follow, to adopt adequate and reasonable standards for measuring a condition, including quantity and quality relating to the furnishing of service, to adopt reasonable rules for examining, testing, and measuring a service, and adopt or approve reasonable rules, specifications, and standards to ensure the accuracy of equipment, including meters and instruments, used to measure service.

Cross-Index to Statutes: Public Utility Regulatory Act §§14.002, 52.002, 52.102, 52.152, 52.109, 53.001, 54.101, 54.151, 55.001, and 55.002

§26.21.General Provisions of Customer Service and Protection Rules.

(a)

Application. Unless the context clearly indicates otherwise, in this subchapter the terms "utility" and "public utility," as they relate to telecommunications utilities, shall refer to dominant carriers.

(b)

Purpose. The purpose of the rules in this subchapter is to establish minimum customer service standards that utilities must follow in providing telephone service to the public. Nothing in these rules should be interpreted as preventing a utility from adopting less restrictive policies for all customers or for differing groups of customers, as long as those policies do not discriminate based on race, nationality, color, religion, sex, or marital status.

(c)

Definitions. The following words and terms when used in this subchapter shall have the following meanings, unless the context indicates otherwise.

(1)

Applicant--A person who applies for service for the first time or reapplies after discontinuance of service.

(2)

Customer--A person who is currently receiving service from a utility in the person's own name or the name of the person's spouse.

(3)

Days--Unless the context clearly indicates otherwise, in this subchapter the term "days" shall refer to calendar days.

§26.22.Request for Service.

Every public utility shall initiate service to each qualified applicant for service within its certificated area in accordance with this section.

(1)

Applications for new telephone service shall be filed in accordance with §23.61(e) of this title (relating to Telephone Utilities) as it concerns service objectives and surveillance levels.

(2)

A utility may require a residential applicant for service to satisfactorily establish credit in accordance with §26.24 of this title (relating to Credit Requirements and Deposits), but such establishment of credit shall not relieve the customer from complying with rules for prompt payment of bills.

(3)

Requests for new residential telephone service requiring construction, such as line extensions shall be completed within 90 days or within a time period agreed to by the customer and utility if the applicant has met the credit requirements as provided for in §26.24 of this title; made satisfactory payment arrangements for construction charges; and has complied with all applicable state and municipal regulations. A telephone "drop" wire less than 300 feet in length which connects the utility distribution facility to the customer premises is not considered a line extension. For this section, facility placement which requires a permit for a road or railroad crossing will be considered a line extension.

(4)

If facilities must be constructed, then the utility shall contact the customer within ten working days of receipt of the application and give the customer an estimated completion date and an estimated cost for all charges to be incurred by the customer.

(5)

Following the assessment of necessary line work, the utility shall explain any construction cost options such as rebates to the customer, sharing of construction costs between the utility and the customer, or sharing of costs between the customer and other applicants.

(6)

Unless the delay is beyond the reasonable control of the utility, a delay of more than 90 days shall constitute failure to serve under the Public Utility Regulatory Act §54.008, unless the customer and utility have agreed to a longer term. The commission may revoke or amend a utility's certificate of convenience and necessity (or other certificate) for such failures to service, or grant the certificate to another utility to serve the applicant, and the utility may be subject to administrative penalties pursuant to the Public Utility Regulatory Act §15.023 and §15.024.

(7)

As part of the initial contact, utility employees shall provide the applicant a copy of the "Your Rights as a Customer" brochure, and inform an applicant of the right to file a complaint with the commission in accordance with §26.30 of this title (relating to Complaints) if the applicant thinks the applicant has been treated unfairly.

§26.23.Refusal of Service.

(a)

Acceptable reasons to refuse service. A utility may refuse to serve an applicant until the applicant complies with state and municipal regulations and the utility's rules and regulations on file with the commission or for any of the reasons identified below.

(1)

Applicant's facilities inadequate. The applicant's installation or equipment is known to be hazardous or of such character that satisfactory service cannot be given or the applicant's facilities do not comply with all applicable state and municipal regulations.

(2)

Violation of utility's tariffs. The applicant fails to comply with the utility's tariffs pertaining to operation of nonstandard equipment or unauthorized attachments which interfere with the service of others. The utility shall provide the applicant notice of such refusal and afford the applicant a reasonable amount of time to comply with the utility's tariffs.

(3)

Failure to pay guarantee. The applicant has acted as a guarantor for another customer and fails to pay the guaranteed amount, where such guarantee was made in writing to the utility and was a condition of service.

(4)

Intent to deceive. The applicant applies for service at a location where another customer received, or continues to receive, service and the utility bill is unpaid at that location and the utility can prove that the change in identity is made to avoid or evade payment of a utility bill. An applicant may request a supervisory review as specified in §26.30 of this title (relating to Complaints) if the utility determines that the applicant intends to deceive the utility and refuses to provide service.

(5)

For indebtedness. Except as provided in §26.29 of this title (relating to Prepaid Local Telephone Service), service may be refused, if the applicant owes a debt to any utility for the same kind of service as that applied for, including long distance charges where a local exchange carrier bills those charges to the customer pursuant to its tariffs. If the applicant's indebtedness is in dispute, the applicant shall be provided service upon complying with the deposit requirement in §26.24 of this title (relating to Credit Requirements and Deposits). Payment of long distance charges shall not be a condition of local exchange service if federal authority prohibits payment of long distance charges as a condition for local service, or prohibits disconnection of local service for failure to pay long distance charges.

(6)

Refusal to pay a deposit. Refusing to pay a deposit if applicant is required to do so under §26.24 of this title.

(b)

Applicant's recourse.

(1)

If a utility has refused to serve an applicant under the provisions of this section, the utility must inform the applicant of the reason for its refusal and that the applicant may file a complaint with the commission as described in §26.30 of this title.

(2)

Additionally, the utility will inform applicants eligible for Prepaid Local Telephone Service, under §26.29 of this title, that this service is available if they are not eligible for standard local telephone service.

(c)

Insufficient grounds for refusal to serve. The following are not sufficient cause for refusal of service to an applicant:

(1)

delinquency in payment for service by a previous occupant of the premises to be served;

(2)

failure to pay for any charges that are not provided for in a utility's tariffs;

(3)

failure to pay a bill that includes more than six months of underbilling unless the underbilling is the result of theft of service; and

(4)

failure to pay the bill of another customer at the same address except where the change in identity is made to avoid or evade payment of a utility bill.

§26.24.Credit Requirements and Deposits.

(a)

Credit requirements for permanent residential applicants.

(1)

A utility may require a residential applicant for service to establish and maintain satisfactory credit as a condition of providing service.

(A)

Establishment of credit shall not relieve any customer from complying with the utility's requirements for prompt payment of bills.

(B)

The credit worthiness of spouses established during the last 12 months of shared service prior to their divorce, will be equally applied to both spouses for 12 months immediately after their divorce.

(2)

A residential applicant can demonstrate satisfactory credit using one of the criteria listed in subparagraphs (A) through (C) of this paragraph.

(A)

The residential applicant:

(i)

has been a customer of any utility for the same kind of service within the last two years;

(ii)

is not delinquent in payment of any utility service account;

(iii)

during the last 12 consecutive months of service was not late in paying a bill more than once;

(iv)

did not have service disconnected for nonpayment; and

(v)

is encouraged to obtain a letter of credit history from the applicant's previous utility. Utilities are encouraged to provide such information with final bills.

(B)

The residential applicant demonstrates a satisfactory credit rating by appropriate means, including, but not limited to, the production of:

(i)

generally acceptable credit cards;

(ii)

letters of credit reference;

(iii)

the names of credit references which may be quickly and inexpensively contacted by the utility; or

(iv)

ownership of substantial equity that is easily liquidated.

(C)

The residential applicant is 65 years of age or older and does not have an outstanding account balance incurred within the last two years with the utility or another utility for the same type of utility service.

(3)

If the applicant does not demonstrate satisfactory credit using these criteria, the applicant may be required to pay a deposit pursuant to subsection (c) of this section.

(b)

Credit requirements for non-residential applicants. If an applicant's credit for service has not been demonstrated satisfactorily to the utility, the applicant may be required to pay a deposit.

(c)

Initial deposits.

(1)

A residential applicant or customer who is required to pay an initial deposit may provide the utility with a written letter of guarantee pursuant to subsection (j) of this section, instead of paying a cash deposit.

(2)

An initial deposit may not be required from an existing customer unless the customer was late paying a bill more than once during the last 12 months of service or had service disconnected for nonpayment. The customer may be required to pay this initial deposit within ten days after issuance of a written disconnection notice that requests such deposit. Instead of an initial deposit, the customer may pay the total amount due on the current bill by the due date of the bill, provided the customer has not exercised this option in the previous 12 months.

(d)

Additional deposits.

(1)

Residential Customers.

(A)

During the first 12 months of service, the utility may request an additional deposit from a residential customer. To require the deposit, the customer's actual usage must:

(i)

be three times estimated usage (or three times average usage of most recent three bills);

(ii)

exceed $150; and

(iii)

exceed 150% of the security held.

(B)

An additional deposit may also be required if:

(i)

actual billings of a residential customer are at least twice the amount of the estimated billings after two billing periods; and

(ii)

a suspension or disconnection notice has been issued for the account within the previous 12 months.

(C)

An additional deposit may be required to be paid within ten days after issuing written notice of suspension or disconnection and requested additional deposit

(D)

Instead of additional deposit, the customer may elect to pay the total amount due on the current bill by the due date of the bill, provided the customer has not exercised this option in the previous 12 months.

(E)

The utility may disconnect service if the additional deposit or the current usage payment is not paid within ten days of request provided a written suspension or disconnection notice has been issued to the customer. A suspension or disconnection notice may be issued concurrently with the written request for the additional deposit or current usage payment.

(2)

Non-residential customers. An additional deposit may be requested from a non-residential customer.

(A)

To require such a deposit, the actual billings of the non-residential customer must be at least twice the amount of the estimated billings, and a suspension or disconnection notice must have been issued on a bill within the previous 12 months.

(B)

The utility may require that the new deposit be made within ten days after issuing a written suspension or disconnection notice and a request for an additional deposit.

(C)

The utility may disconnect service if the additional deposit or the current usage payment is not paid within ten days of the request provided a written suspension or disconnection notice has been properly issued to the customer. A suspension or disconnection notice may be issued concurrently with the written request for the additional deposit or current usage payment.

(e)

Deposits for temporary or seasonal service and for weekend residences. The utility may require a deposit sufficient to reasonably protect it against the assumed risk for temporary or seasonal service or service to a weekend residence, as long as the policy is applied in a uniform and nondiscriminatory manner. These deposits shall be returned according to guidelines set out in subsection (k) of this section.

(f)

Amount of deposit.

(1)

The total of all deposits shall not exceed an amount equivalent to one-sixth of the estimated annual billing, except as provided in §26.29 of this title (relating to Prepaid Local Telephone Service). The estimated annual billings may include charges that are in a utility's tariffs including long distance charges only where the local exchange carrier bills those charges to the customer pursuant to its tariffs. Such charges shall not be included in calculating the deposit amount if federal authority so prohibits, or prohibits long distance charges as a condition for local service or as a reason for disconnection of local exchange service.

(2)

In determining the amount of any deposit permitted by this section, no revenue from non-tariffed products or services may be used.

(g)

Interest on deposits. Each utility requiring deposits shall pay interest on these deposits at an annual rate at least equal to that set by the commission on December 1 of the preceding year, pursuant to Texas Utilities Code Annotated §183.003 (Vernon 1998) (relating to Rate of Interest). If a deposit is refunded within 30 days of receipt, no interest payment is required. If the utility keeps the deposit more than 30 days, payment of interest shall be made retroactive to the date of deposit.

(1)

Payment of the interest to the customer shall be made annually, if requested by the customer, or at the time the deposit is returned or credited to the customer's account.

(2)

The deposit shall cease to draw interest on the date it is returned or credited to the customer's account.

(h)

Notification to customers. When a deposit is required, the utility shall provide applicants or customers written information about deposits by giving the customer a copy of the brochure, "Your Rights as a Customer".

(i)

Records of deposits.

(1)

The utility shall keep records to show:

(A)

the name and address of each depositor;

(B)

the amount and date of the deposit; and

(C)

each transaction concerning the deposit.

(2)

The utility shall issue a receipt of deposit to each applicant paying a deposit and shall provide means for a depositor to establish claim if the receipt is lost.

(3)

A record of each unclaimed deposit must be maintained for at least four years.

(4)

The utility shall make a reasonable effort to return an unclaimed deposit.

(j)

Guarantees of residential customer accounts.

(1)

A guarantee between a utility and a guarantor must be in writing and shall be for no more than the amount of deposit the utility would require on the applicant's account pursuant to subsection (f) of this section. The amount of the guarantee shall be clearly indicated in the signed agreement.

(2)

The guarantee shall be voided and returned to the guarantor according to the provisions of subsection (k) of this section.

(3)

Upon default by a residential customer, the guarantor of that customer's account shall be responsible for the unpaid balance of the account only up to the amount agreed to in the written agreement.

(4)

The utility shall provide written notification to the guarantor of the customer's default, the amount owed by the guarantor, and the due date for the amount owed.

(A)

The utility shall allow the guarantor 16 days from the date of notification to pay the amount owed on the defaulted account. If the sixteenth day falls on a holiday or weekend, the due date shall be the next workday.

(B)

The utility may transfer the amount owed on the defaulted account to the guarantor's own service bill provided the guaranteed amount owed is identified separately on the bill as required by §26.25(c)(4)(I) of this title (relating to the Issuance and Format of Bills).

(5)

The utility may disconnect service to the guarantor for nonpayment of the guaranteed amount only if the disconnection was included in the terms of the written agreement and only after proper notice as described by paragraph (4) of this subsection, and §26.28(b)(5) of this title (relating to Suspension or Disconnection of Service).

(k)

Refunding deposits and voiding letters of guarantee.

(1)

If service is not connected, or is disconnected, the utility shall promptly void and return to the guarantor all letters of guarantee on the account or provide written documentation that the contract has been voided or refund the customer's deposit plus accrued interest on the balance, if any, in excess of the unpaid bills for service furnished. A transfer of service from one premise to another within the service area of the utility is not a disconnection, and no additional deposit may be required.

(2)

When the customer has paid bills for service for 12 consecutive residential billings or for 24 consecutive non-residential billings without having service disconnected for nonpayment of a bill and without paying bills late more than twice, and when the customer is not delinquent in the payment of the current bills, the utility shall promptly refund the deposit plus accrued interest to the customer, or void and return the guarantee, or provide written documentation that the contract has been voided. If the customer does not meet these refund criteria, the deposit and interest or letter of guarantee may be retained.

(l)

Re-establishment of credit. Every applicant who previously has been a customer of the utility and whose service has been disconnected for nonpayment of bills or theft of service shall be required, before service is reconnected, to pay all amounts due the utility or execute a deferred payment agreement, if offered, and reestablish credit. The utility must prove the amount of utility service received but not paid for and the reasonableness of any charges for the unpaid service and any other charges required as a condition of service restoration.

(m)

Upon sale or transfer of utility or company. Upon the sale or transfer of any utility or any of its operating units, the seller shall provide the buyer with all deposit records.

§26.25.Issuance and Format of Bills.

(a)

Frequency of bills. The utility shall issue bills monthly unless otherwise authorized by the commission or unless service is for less than one month. Bills shall list all charges due.

(b)

Billing information.

(1)

The utility shall provide free to the customer a breakdown of local service charges at the time the service is initially installed or modified and upon request.

(2)

Customer billing sent through the United States mail shall be sent in an envelope.

(c)

Bill content.

(1)

A notice shall be included on the customer's bill of the customer's right to a free annual or monthly itemized breakdown of all local service charges. The itemized breakdown may be on the customer's bill or sent by separate mailing.

(2)

If the utility is billing the customer for services from another service provider, the bill shall identify the service provider and provide a toll-free number to call to resolve disputes or obtain information.

(3)

The information required by this paragraph shall be arranged to allow the customer to readily compute the bill with the information provided.

(4)

Each customer's bill shall include but not be limited to:

(A)

the billing period;

(B)

the due date of the bill, as specified in §26.27 of this title (relating to Bill Payment and Adjustments);

(C)

each applicable telephone number and/or account number;

(D)

the total amount due for features and services;

(E)

the subtotal for basic local telecommunications service;

(i)

if expanded calling scope services are mandatory, charges for the service shall be included in the subtotal for basic local service; or

(ii)

if expanded calling scope service is optional, the incremental charges for the service shall be included in the subtotal for optional features;

(F)

the sub-total for all optional features or services included in the bill;

(G)

any tax, fee, or charge mandated by a federal, state, or local governmental agency that is to be specifically collected from customers;

(H)

itemized long distance charges;

(I)

any amount owed under a written guarantee contract provided the guarantor was previously notified in writing by the utility as required by §26.24 of this title (relating to Credit Requirements and Deposits);

(J)

lease payments, including applicable sales taxes, for customer premises equipment owned by the carrier as part of its nonregulated operations or owned by another entity, which are clearly distinguished from charges for regulated services; and

(K)

explanations of any abbreviations, symbols, or acronyms used that identify specific charges.

(d)

Record retention. Each utility shall maintain monthly billing records for each account for at least two years after the date the bill is mailed. The billing records shall contain sufficient data to reconstruct a customer's billing for a given month. Copies of a customer's billing records may be obtained by that customer upon request.

(e)

Prepaid Local Telephone Service. To the extent any provisions of this section are applied to customers subscribing to Prepaid Local Telephone Service and are inconsistent with the rates, terms, and conditions of §26.29 of this title (relating to Prepaid Local Telephone Service), the provisions of §26.29 of this title shall apply.

§26.26.Spanish Language Requirements.

(a)

Application. This section applies to each utility that serves a county where the number of Spanish-speaking persons as defined in §26.5 of this title (relating to Definitions) is 2000 or more according to the most current U.S. Census of Population (Bureau of Census, U.S. Department of Commerce, Census of Population and Housing).

(b)

Written plan.

(1)

Requirement. Each utility shall have a commission-approved written plan that describes how a Spanish-speaking person is provided, or will be provided reasonable access to the utility's programs and services.

(2)

Minimum elements. The written plan required by paragraph (1) of this subsection shall include a clear and concise statement as to how the utility is doing or will do the following, for each part of its entire system:

(A)

inform Spanish-speaking applicants and customers how they can get information contained in the utility's plan in the Spanish language;

(B)

inform Spanish-speaking applicants and customers of their rights contained in this subchapter;

(C)

inform Spanish-speaking applicants and customers of new services, discount programs, and promotions;

(D)

allow Spanish-speaking customers to request repair service;

(E)

ballot Spanish-speaking customers for services requiring a vote by ballot; and

(F)

inform all of its service and repair representatives of the requirements of the plan.

§26.27.Bill Payment and Adjustments.

(a)

Bill due date. The bill provided to the customer shall include the payment due date, which shall not be less than 16 days after issuance. The issuance date is the postmark date on the envelope or the issuance date on the bill if there is no postmark on the envelope. Payment for utility service is delinquent if not received at the utility or at the utility's authorized payment agency by close of business on the due date. If the sixteenth day falls on a holiday or weekend, then the due date shall be the next workday after the sixteenth day.

(b)

Penalty on delinquent bills for retail service. A one-time penalty not to exceed 5.0% may be charged on each delinquent commercial or industrial bill. No penalty shall apply to a residential bill. The 5.0% penalty on delinquent bills may not be applied to any balance to which the penalty has already been applied. A telecommunications utility providing any service to the state, including service to an agency in any branch of government, shall not assess a fee, penalty, interest, or other charge to the state for delinquent payment of a bill.

(c)

Billing adjustments due to service interruptions. In the event a customer's service is interrupted other than by the negligence or willful act of the customer, and it remains interrupted for 24 hours or longer after being reported and after access to the premises is made available, appropriate adjustment or refunds shall be made to the customer.

(1)

The amount of adjustment or refund shall be determined on the basis of the known period of interruption, generally beginning from the time the service interruption is first reported.

(2)

The refund to the customer shall be the proportionate part of the month's flat rate charges for the period of days and that portion of the service facilities rendered useless or inoperative.

(3)

The refund may be accomplished by a credit on a subsequent bill.

(d)

Overbilling. If charges are found to be higher than authorized by the utility's tariffs, the customer's bill shall be corrected.

(1)

The correction shall be made for the entire period of the overbilling.

(2)

If the utility corrects the overbilling within three billing cycles of the error, it need not pay interest on the overcharge.

(3)

If the utility does not correct the overcharge within three billing cycles of the bill in error, it shall pay interest on the amount of the overcharge at the rate set by the commission each year.

(A)

The interest rate shall be based on an average of prime commercial paper rates for the previous 12 months.

(B)

Interest on overcharges that are not adjusted by the utility within three billing cycles of the bill in error shall accrue from the date of payment or the date of the bill in error.

(C)

All interest shall be compounded monthly based on the annual rate.

(e)

Underbilling. If charges are found to be lower than authorized by the utility's tariffs, or if the utility failed to bill the customer for service, the customer's bill may be corrected.

(1)

The utility may backbill the customer for the amount that was underbilled. The backbilling shall not collect charges that extend more than six months from the date the error was discovered unless underbilling is a result of theft of service by the customer.

(2)

The utility may disconnect service if the customer fails to pay charges arising from an underbilling.

(3)

If the underbilling is $50 or more, the utility shall offer the customer a deferred payment plan option for the same length of time as that of the underbilling. A deferred payment plan need not be offered to a customer whose underpayment is due to theft of service.

(4)

The utility shall not charge interest on underbilled amounts unless such amounts are found to be the result of theft of service by the customer. Interest on underbilled amounts shall be compounded monthly based on the annual rate and shall accrue from the day the customer is found to have first tampered with, bypassed, or diverted the service.

(f)

Disputed bills.

(1)

If there is a dispute between a customer and a utility about any bill for utility service, the utility shall investigate and report the results to the customer. If the dispute is not resolved, the utility shall inform the customer of the complaint procedures of the commission pursuant to §26.30 of this title (relating to Complaints).

(2)

A customer's service shall not be suspended or disconnected for nonpayment of the disputed portion of the bill before the dispute is completely resolved by the utility.

(3)

If the customer files a complaint with the commission, a customer's service shall not be suspended or disconnected for nonpayment of the disputed portion of the bill until the commission completes its informal complaint resolution process and informs the customer of its conclusions. If payment of some portion of the disputed amount is then required, the customer shall have ten days from the date when the commission issued its findings to pay the outstanding bill before it will be considered delinquent.

(4)

The customer is obligated to pay any billings not disputed.

(g)

Notice of alternative payment programs or payment assistance. When a customer contacts a utility and indicates inability to pay a bill or need of assistance with payment, the utility shall inform the customer of all alternative payment and payment assistance programs available from the utility, such as deferred payment plans, disconnection moratoriums for the ill, as applicable, and of the eligibility requirements and procedure for applying for each.

(h)

Payment arrangements. A "payment arrangement" is any agreement between the utility and a customer which allows the customer to pay the outstanding bill after its due date but before the due date of the next bill. If the utility issued a suspension or disconnection notice before the payment arrangement was made, that suspension or disconnection should be suspended until after the due date for the payment arrangement. If a customer does not fulfill the obligations of the payment arrangement, the utility may suspend or disconnect service after the later of the due date for the payment arrangement or the suspension or disconnection date indicated in the notice, pursuant to §26.28 of this title (relating to Suspension or Disconnection of Service), without issuing an additional notice.

(i)

Deferred payment plan. A deferred payment plan is any written agreement between the utility and a customer that allows a customer to pay an outstanding bill in installments that extend beyond the due date of the next bill. A deferred payment plan may be established in person or by telephone and all deferred payment plans shall be put in writing.

(1)

The utility shall offer a deferred payment plan to any residential customer, including a guarantor of any residential customer, who has expressed an inability to pay all of the bill, if that customer has not been issued more than two suspension or disconnection notices during the preceding 12 months; and

(2)

Every deferred payment plan shall provide that the delinquent amount may be paid in equal installments over at least three billing cycles.

(3)

When a residential customer has received service from its current utility for less than three months, the utility is not required to offer a deferred payment plan if the residential customer lacks:

(A)

sufficient credit; or

(B)

a satisfactory history of payment for service from a previous utility.

(4)

Every deferred payment plan offered by a utility:

(A)

shall state, immediately preceding the space provided for the customer's signature and in boldface type no smaller than 14 point size, the following: "If you are not satisfied with this contract, or if agreement was made by telephone and you feel this contract does not reflect your understanding of that agreement, contact the utility immediately and do not sign this contract. If you do not contact the utility, or if you sign this agreement, you may give up your right to dispute the amount due under the agreement except for the utility's failure or refusal to comply with the terms of this agreement." In addition, if the customer and the utility representative or agent meet in person, the utility representative shall read the preceding statement to the customer. The utility shall provide information to the customer in English and Spanish as necessary to make the preceding statement understandable to the customer;

(B)

may include a 5.0% penalty for late payment but shall not include a finance charge;

(C)

shall state the length of time covered by the plan;

(D)

shall state the total amount to be paid;

(E)

shall state the specific amount of each installment;

(F)

shall allow the utility to disconnect service if a customer does not fulfill the terms of the deferred payment plan;

(G)

shall not refuse a customer participation in such a program on the basis of race, nationality, religion, color, sex, or marital status;

(H)

shall be signed by the customer and a copy of the signed plan must be provided to the customer. If the agreement is made over the telephone, then the utility shall send a copy of the plan to the customer for signature; and

(I)

shall allow either the customer or the utility to renegotiate the deferred payment plan, if the customer's economic or financial circumstances change substantially during the time of the plan.

(5)

A utility may disconnect a customer who does not meet the terms of a deferred payment plan. However, the utility may not disconnect service until a disconnection notice has been issued to the customer indicating that the customer has not met the terms of the plan. The notice and disconnection shall conform with the disconnection rules in §26.28 of this title. The utility may renegotiate the deferred payment plan agreement before disconnection. If the customer did not sign the deferred payment plan and is not otherwise fulfilling the terms of the plan and the customer was previously provided a disconnection notice for the outstanding amount, no additional notice is required.

§26.28.Suspension or Disconnection of Service.

(a)

Suspension or Disconnection Policy. If a utility chooses to suspend or disconnect a customer, it must follow the procedures below or modify them in ways that are more generous to the customer in terms of the cause for suspension or disconnection, the timing of the suspension or disconnection notice, and the period between notice and suspension or disconnection. Each utility is encouraged to develop specific policies for suspension and disconnection that treat its customers with dignity and respect for customers' or members' circumstances and payment history, and to implement those policies in ways that are consistent and non-discriminatory. Suspension or disconnection are options allowed by the commission, not requirements placed upon the utility by the commission.

(b)

Suspension or disconnection with notice. Utility service may be suspended or disconnected after proper notice, for any of these reasons:

(1)

failure to pay a bill for charges that are in a utility's tariffs including long distance charges only where the local exchange carrier bills those charges to the customer pursuant to its tariffs or make deferred payment arrangements by the date of suspension or disconnection;

(2)

failure to comply with the terms of a deferred payment agreement except as provided in §26.29 of this title (relating to Prepaid Local Telephone Service);

(3)

violation of the utility's rules on the use of service in a manner which interferes with the service of others or the operation of nonstandard equipment, if a reasonable attempt has been made to notify the customer and the customer has a reasonable opportunity to remedy the situation;

(4)

failure to pay a deposit as required by §26.24 of this title (relating to Credit Requirements and Deposits); or

(5)

failure of the guarantor to pay the amount guaranteed, when the utility has a written agreement, signed by the guarantor, that allows for disconnection of the guarantor's service for nonpayment.

(c)

Suspension or disconnection without notice. Utility service may be suspended or disconnected without notice, except as provided in §26.29 of this title, for any of the following reasons:

(1)

where service is connected without authority by a person who has not made application for service;

(2)

where service was reconnected without authority after termination for nonpayment; or

(3)

where there are instances of tampering with the utility company's equipment or evidence of theft of service.

(d)

Suspension or disconnection prohibited. Utility service may not be suspended or disconnected for any of these reasons:

(1)

failure to pay for any charges that are not provided for in a utility's tariffs;

(2)

failure to pay for a different type or class of utility service unless charges were included on the bill at the time service was initiated;

(3)

failure to pay charges resulting from underbilling that is more than six months before the current billing, except for theft of service; or

(4)

failure to pay disputed charges until a determination is made on the accuracy of the charges.

(e)

Suspension or disconnection on holidays or weekends. Unless a dangerous condition exists or the customer requests disconnection, service shall not be suspended or disconnected on holidays or weekends, or the day immediately preceding a holiday or weekend, unless utility personnel are available on those days to take payments and reconnect service.

(f)

Disconnection due to utility abandonment. No public utility may abandon a customer or a certified service area without written notice to its customers and all neighboring utilities, and approval from the commission.

(g)

Suspension or disconnection for ill and disabled. No utility may suspend or disconnect service at the permanent residence of a delinquent customer if that customer establishes that such action will prevent the customer from summoning emergency medical help for someone who is seriously ill residing at that residence.

(1)

Each time a customer seeks to avoid suspension or disconnection of service under this subsection, the customer before the date of suspension or disconnection shall:

(A)

have the person's attending physician (for purposes of this subsection, the term "physician" shall mean any public health official, including, but not limited to, medical doctors, doctors of osteopathy, nurse practitioners, registered nurses, and any other similar public health official) contact the utility by the stated date of disconnection;

(B)

have the person's attending physician submit a written statement to the utility; and

(C)

enter into a deferred payment plan.

(2)

The prohibition against suspension or disconnection provided by this subsection shall last 63 days from the issuance of the utility bill or a shorter period agreed upon by the utility and the customer or physician.

(h)

Suspension and disconnection notices. Any suspension or disconnection notice issued by a utility to a customer must:

(1)

not be issued to the customer before the first day after the bill is due. Payment of the delinquent bill at a utility's authorized payment agency is considered payment to the utility.

(2)

be a separate mailing or hand delivery with a stated date of suspension or disconnection and with the words "suspension notice," or "disconnection notice," or similar language prominently displayed on the notice.

(3)

have a suspension or disconnection date that is not a holiday or weekend day, not less than ten days after the notice is issued.

(4)

be in English and Spanish.

(5)

include a statement notifying customers that if they need assistance paying their bill, or are ill and unable to pay their bill, they may be able to make some alternative payment arrangement or establish a deferred payment plan. The notice shall advise customers to contact the utility for more information.

§26.29.Prepaid Local Telephone Service (PLTS).

(a)

Applicability. The provisions of this section shall apply to all dominant certificated telecommunications utilities (DCTUs) unless specifically indicated otherwise. A DCTU shall provide prepaid local telephone service (PLTS) as required by this section and shall not refuse to provide PLTS to an applicant for such service because the applicant is indebted to any DCTU or other telecommunications carrier for telecommunication services, including the carriage charges of interexchange carriers where the DCTU bills those charges under tariffs or contracts.

(b)

Eligible customers.

(1)

Former customers. In cases where a DCTU would refuse to provide service to an applicant for residential telephone service because of indebtedness to any DCTU or other telecommunications carrier, the applicant is eligible to receive PLTS as required by this section.

(2)

Current customers. A current residential customer who has not been disconnected but who has received a notice following suspension of service for non-payment for services is eligible to receive PLTS as required by this section.

(3)

Applicant previously disconnected from PLTS by a DCTU. Any applicant who was previously disconnected from PLTS by a DCTU, pursuant to subsection (e)(6) of this section, does not have the right to receive PLTS from that DCTU again.

(4)

Business customers shall not be eligible for PLTS.

(c)

Requirements for notifying customers about PLTS. A DCTU shall provide notice to its customers about PLTS as required by this subsection.

(1)

Timing of notice.

(A)

If the DCTU's standard practice is to suspend a customer's service for non- payment of charges before disconnecting service, it shall notify the customer of the availability of PLTS in the suspension notice.

(B)

If the DCTU's standard practice is to disconnect a customer's service without suspension, the DCTU shall notify such customer of the availability of PLTS within three days after disconnection.

(2)

Content of notice. The notice provided by a DCTU offering PLTS shall be reviewed in the DCTU's compliance filing and shall notify customers of the rates, terms, and conditions of PLTS, as described in subsection (e) of this section, including:

(A)

a customer's eligibility to enter into the PLTS plan;

(B)

a description of the PLTS plan including its features, charges, and options;

(C)

a customer's responsibility to make an initial payment for PLTS and any applicable service connection charges, as defined in subsection (e)(2)(A) of this section;

(D)

a customer's responsibility to make the initial deferred payment, if applicable, in the third billing cycle and every month thereafter, for up to 12 months;

(E)

a customer's responsibility not to incur additional charges for calls, including long distance or other usage-sensitive services that will be charged on the local telephone bill, nor to subscribe to any services other than those included in PLTS, as defined in §26.5 of this title (relating to Definitions);

(F)

a customer's violation of the terms and conditions of the PLTS plan may result in disconnection;

(G)

if a customer is disconnected for violation of the terms and conditions of the PLTS plan, a DCTU has the right to retain and apply any credit in the PLTS account to the customer's outstanding balances for telecommunications services;

(H)

if a customer is disconnected for violation of the terms and conditions of the PLTS plan, that customer does not have the right to receive PLTS from that DCTU again; and

(I)

the customer's responsibility to subscribe to PLTS within a certain time period in order to defer service restoration or connection charges as described in subsection (e)(1)(B) of this section.

(d)

Subscription to PLTS.

(1)

Customer request to subscribe to PLTS. To subscribe to PLTS, an eligible customer must contact the DCTU during regular business hours to request PLTS.

(2)

Confirmation letter. Within 24 hours after a customer requests PLTS, the DCTU shall mail the customer a confirmation letter in English or Spanish as necessary, explaining the PLTS plan, including the customer's rights and responsibilities upon enrollment and information about the rates, terms, and conditions of service under the PLTS plan.

(e)

Rates, terms, and conditions of PLTS. A DCTU shall offer PLTS under the following terms and conditions:

(1)

Rates for PLTS.

(A)

The monthly rate for PLTS shall include only:

(i)

the applicable residential tariffed rate (or lifeline rates, if applicable) for services included in the PLTS definition in §26.5 of this title;

(ii)

tariffed charges for non-listed and non-published service, if requested by the customer; and

(iii)

surcharges and fees authorized by a governmental entity that are billed by the DCTU, including 911, subscriber line charges, sales tax, and municipal fees.

(B)

Non-recurring rates.

(i)

If a DCTU does not suspend basic local service before disconnection, the DCTU must defer service connection charges until the customer returns to basic local telecommunications service. However, if a customer does not subscribe to PLTS within ten days from the date the DCTU mailed a termination notice containing notice of PLTS eligibility, the DCTU may charge service connection charges when subscribing to PLTS.

(ii)

If a DCTU suspends basic local service prior to disconnection, the DCTU must defer service restoration charges until the subscribing customer returns to basic local telecommunications service.

(C)

Late charges. The DCTU shall not assess late charges on a PLTS customer.

(2)

Payments under PLTS.

(A)

A DCTU may require the residential PLTS customer to make an initial payment for service, which shall not exceed:

(i)

the rates as described in paragraph (1)(A) of this subsection for up to two months of service; and

(ii)

applicable non-recurring service connection charges.

(B)

A DCTU shall not require subsequent monthly payments that exceed the rates for one month of PLTS. The due date of monthly payments shall be based on the DCTU's regular monthly billing cycle.

(C)

A customer may be required to make payments under the deferred payment plan according to paragraph (4) of this subsection.

(3)

Toll blocking. PLTS subscribers shall have mandatory toll blocking and usage sensitive blocking placed on the telephone lines.

(A)

Customer responsibility. A customer subscribing to PLTS shall not place or receive calls, including long distance or other usage-sensitive services, for which additional charges are billed to the customer's telephone number, nor subscribe to any services other than those included in PLTS.

(B)

DCTU responsibility. The DCTU shall notify the customers of their responsibilities under PLTS when the customer inquires about the service in the confirmation letter.

(4)

Deferred payment plan under PLTS. As a condition of subscribing to PLTS, the DCTU may require an applicant to enter into a deferred payment plan for any outstanding debt owed to the DCTU for local basic telephone service. The DCTU shall not require an applicant to enter into a deferred payment plan to pay any outstanding debt for any services that the customer cannot use under PLTS including long distance services. If the DCTU is unable to determine the amount of outstanding debt, the DCTU shall not require an applicant to enter into a deferred payment plan.

(A)

Determination of deferred payment plan amount. To determine the deferred payment plan amount, the DCTU shall:

(i)

determine the amount the customer owes for basic local telephone service;

(ii)

apply any undesignated partial payment made by the customer before subscribing to PLTS to past debt for local telecommunications service; and

(iii)

not reallocate any undesignated partial payments assigned under clause (ii) of this subparagraph to amounts not yet incurred for basic local telecommunications service.

(B)

Monthly payments under the deferred payment plan.

(i)

A deferred payment plan for past due charges shall not require the applicant to make monthly payments which exceed $10 per month or one-twelfth of the outstanding debt as determined in subparagraph (A) of this paragraph, whichever is greater.

(ii)

If the DCTU and PLTS customer enter into a deferred payment, the initial deferred payment shall be billed beginning with the third billing cycle after initiation of service and on a monthly basis thereafter.

(5)

Customer deposit. No deposit shall be required from any residential applicant for PLTS.

(6)

Disconnection of PLTS.

(A)

Disconnection with notice. A DCTU may disconnect PLTS after notice for any of the following reasons:

(i)

failure to comply with the terms of a deferred payment plan for PLTS;

(ii)

upon conclusion of all periods for which an advance payment has been applied to the PLTS account and when the customer's PLTS account has a zero balance; or

(iii)

violation of the DCTU's rules on using PLTS in a manner which interferes with the service of others or the operation of nonstandard equipment, if a reasonable attempt has been made to notify the customer and the customer has a reasonable opportunity to remedy the situation.

(B)

Disconnection without notice. A DCTU may immediately disconnect PLTS without notice:

(i)

if the customer accrues new charges for toll or other services on the telephone bill as described in paragraph (3) of this subsection;

(ii)

where a known dangerous condition exists for as long as the condition exists; or

(iii)

where service is connected without authority by a person who has not applied for the service or who has reconnected service without authority after termination.

(C)

Notice after disconnection. If a PLTS customer is disconnected under subparagraph (A) or (B) of this paragraph, a DCTU shall send a final notice stating that the customer is permanently disconnected from PLTS and that the customer shall not be eligible for PLTS from that DCTU. That notice shall also state the terms and conditions that the customer must satisfy before the customer can return to basic local telecommunications service.

(f)

Return to basic local telecommunications service.

(1)

A customer subscribing to PLTS may return to basic local telecommunications service if the customer has paid:

(A)

all outstanding debt to the DCTU, including the carriage charges of interexchange carriers where the DCTU bills those charges pursuant to tariffs or contracts; and

(B)

bills for PLTS.

(2)

When a customer completes the obligations identified in paragraph (1) of this subsection, a DCTU shall notify the customer of the:

(A)

eligibility requirements for returning to basic local telecommunications services;

(B)

option of receiving basic local telecommunications service with toll blocking and/or usage sensitive blocking; and

(C)

requirement to contact the DCTU if the customer wants to return to basic local telecommunications service.

(3)

If the customer is eligible to return to basic local telecommunications service, the customer shall:

(A)

request basic local telecommunications service from the DCTU; and

(B)

pay the service restoration fee, if applicable.

(g)

Customer education.

(1)

The commission shall provide information about the PLTS plan to customers.

(2)

A DCTU subject to the requirements of this section shall provide information about the PLTS plan annually in customers' bills. This information shall be subject to review during the DCTU's compliance filing.

(3)

A DCTU or its affiliate publishing a white pages directory on behalf of the DCTU shall disclose in clear language the availability, terms, and conditions of the PLTS plan in the section of the directory stating the rights of a customer.

(h)

Toll and usage sensitive blocking capability.

(1)

The DCTU shall provide toll blocking and usage sensitive blocking to its maximum technical capability.

(A)

If the DCTU's tariffs reflect its maximum technical capability, it shall provide toll blocking and usage sensitive blocking as stated in those tariffs.

(B)

If the DCTU's tariffs do not reflect its maximum technical blocking capability, it shall inform the commission of the maximum level of blocking it is required to provide under PLTS in its compliance filings.

(C)

If the DCTU does not have a tariff for toll or usage sensitive blocking but has such technical capability, it shall inform the commission of the maximum level of blocking it is required to provide under PLTS in its compliance filings.

(D)

As the DCTU's blocking capability increases, it shall notify the commission and provide such enhanced blocking under PLTS.

(2)

Where technically capable, toll blocking shall not deny access to toll-free numbers.

(3)

When imposing a toll or usage sensitive services block, the DCTU shall do so in a manner that is not unreasonably preferential, prejudicial, or discriminatory.

(i)

Waiver request.

(1)

A DCTU may request exemption from the requirements of this section, on a wire- center by wire-center basis, if it cannot meet the toll blocking and/or usage sensitive requirements.

(2)

A DCTU requesting a waiver shall fully document in its compliance filings the technical reasons for its inability to toll and/or usage sensitive block and indicate when such technical capability will be available in the wire center.

(3)

A waiver shall expire when the DCTU acquires the capability to block toll and/or usage sensitive services or when the DCTU is required to acquire the capability to toll and/or usage sensitive block by federal or state law or regulations, whichever comes first. The DCTU shall notify the commission in writing within 30 days of acquiring or being required to acquire the capability.

(j)

Interexchange carrier (IXC) notification. A DCTU serving 31,000 or more access lines and that is not a cooperative corporation shall:

(1)

Within 24 hours after a customer subscribes to PLTS, include a notice in the Customer Access Record Exchange (CARE) or similar report if developed by the DCTU, and the Line Identification Database (LIDB) indicating that the customer is subscribed to PLTS and any number changes;

(2)

Make access to the information contained in LIDB available to all IXCs serving the customer's area; and

(3)

If CARE, or similar report if developed by the DCTU, and LIDB are not available, the DCTU shall specify in its tariffs a comparable method of providing such notice to IXCs serving the area indicating a customer's subscription to PLTS; and

(4)

This subsection should not be interpreted as expanding access to CARE, or similar report if developed by the DCTU, to IXCs other than the customers' presubscribed carriers.

(k)

Tariff compliance. A DCTU subject to this section shall file tariffs in compliance with this section, and pursuant to §23.24 of this title (relating to Form and Filing of Tariffs).

§26.30.Complaints.

(a)

Complaints to the utility. A customer may file a complaint in person, by letter, or by telephone with the utility. The utility shall investigate and advise the complainant of the results within 21 days.

(b)

Supervisory review by the utility. Any utility customer or applicant has the right to request a supervisory review if they are not satisfied with the utility's response to their complaint.

(1)

If the utility is unable to provide a supervisory review immediately following the customer's request, then arrangements for the review shall be made for the earliest possible date.

(2)

Service shall not be disconnected before completion of the review. If the customer chooses not to participate in a review then the company may disconnect service, providing proper notice has been issued under the disconnect procedures in §26.28 of this title (relating to Suspension or Disconnection of Service).

(3)

The results of the supervisory review must be provided in writing to the customer within ten days of the review, if requested.

(4)

Customers who are dissatisfied with the utility's supervisory review must be informed of their right to file a complaint with the commission.

(c)

Complaints to the commission.

(1)

If the complainant is dissatisfied with the results of the utility's complaint investigation or supervisory review, the utility must advise the complainant of the commission's informal complaint resolution process. The utility must also provide the customer the following contact information for the commission: Public Utility Commission of Texas, Office of Customer Protection, PO Box 13326, Austin, Texas 78711-3326, (512) 936-7120 or in Texas (toll-free) 1-888- 782-8477, fax (512) 936-7003, e-mail address customer@puc.state.tx.us, Internet address www.puc.state.tx.us, TTY (512) 936-7136, and Relay Texas (toll-free) 1- 800-735-2989.

(2)

The utility shall investigate all complaints and advise the commission in writing of the results of the investigation within 21 days after the complaint is forwarded to the utility.

(3)

The utility shall keep a record for two years after determination by the commission of all complaints forwarded to it by the commission. This record shall show the name and address of the complainant, the date, nature and adjustment or disposition of the complaint. Protests regarding commission-approved rates or charges which require no further action by the utility need not be recorded.

§26.31.Information to Applicants and Customers.

(a)

Information to residential applicants. Each utility shall provide this information to applicants when they request new service or transfer existing service to a new location:

(1)

the utility's lowest-priced alternatives and range of service offerings available at the applicant's location. The information shall begin with the lowest-priced alternative and give full consideration to applicable equipment options and installation charges; and

(2)

the customer information packet described in subsection (c) of this section. This is not required for transfer of existing service.

(b)

Information regarding rate schedules and classifications and utility facilities.

(1)

Each utility shall notify customers affected by a change in rates or schedule of classification.

(2)

Each utility shall maintain copies of its rates and services tariff in each office where applications are received.

(3)

Each utility shall post a notice in a conspicuous place in each office where service applications are received, informing the public that copies of the rate schedules and rules relating to the service of the utility, as filed with the commission, are available for inspection.

(4)

Each utility shall maintain a current set of maps showing the physical locations of its facilities that include an accurate description of all facilities (central office facilities, buried cable, etc.). These maps shall be kept by the utility in a central location and will be available for commission inspection during normal working hours. Each business office or service center shall have available up-to-date maps, plans, or records of its immediate service area, with any other information necessary to enable the utility to advise applicants and others entitled to the information about the facilities serving that locality.

(c)

Customer information packets.

(1)

The information packet shall be entitled "Your Rights as a Customer." Cooperatives may use the title "Your Rights as a Member."

(2)

The information packet shall be mailed to all customers at least every other year at no charge to the customer. If the utility provides the customer with the same information in the telephone directories provided to each customer pursuant to §23.61(b) of this title (relating to Telephone Utilities), the utility shall provide a printed statement on the bill, or a billing insert identifying the location of the information in paragraph (5) of this subsection. The statement shall be published every six months.

(3)

The information shall be written in plain, non-technical language.

(4)

The information shall be provided in English and Spanish; however, a utility is exempt from the Spanish language requirement if 10% or fewer of its customers are exclusively Spanish-speaking. If the utility is exempt from the Spanish language requirement, it shall notify all customers through a statement in both English and Spanish, in the packet, that the information is available in Spanish from the utility, both by mail and at the utility's offices.

(5)

The information packet shall include all of the following:

(A)

the customer's right to information about rates and services and the customer's right to inspect or obtain at reproduction cost a copy of the applicable tariffs and service rules;

(B)

the utility's credit requirements and the circumstances under which a deposit or an additional deposit may be required, how a deposit is calculated, the interest paid on deposits, and the time frame and requirement for return of the deposit to the customer;

(C)

the time allowed to pay outstanding bills;

(D)

grounds for suspension and/or disconnection of service;

(E)

the steps that must be taken before a utility may suspend and/or disconnect service;

(F)

the steps for resolving billing disputes with the utility and how disputes affect suspension and/or disconnection of service;

(G)

information on alternative payment plans offered by the utility, including, but not limited to, payment arrangements and deferred payment plans, as well as a statement that a customer has the right to request these alternative payment plans;

(H)

the steps necessary to have service restored and/or reconnected after involuntary suspension or disconnection;

(I)

the availability of prepaid local telephone service;

(J)

the customer's right to file a complaint with the utility, the procedures for a supervisory review, and right to file a complaint with the commission regarding any matter concerning the utility's service. The commission's contact information: Public Utility Commission of Texas, Office of Customer Protection, PO Box 13326, Austin, Texas 78711-3326, (512) 936-7120 or in Texas (toll-free) 1-888-782-8477, fax (512) 936-7003, e-mail address customer@puc.state.tx.us, Internet address www.puc.state.tx.us, TTY (512) 936-7136, and Relay Texas (toll-free) 1-800-735-2989, shall accompany this information;

(K)

the hours, addresses, and telephone numbers of utility offices where bills may be paid and information may be obtained, or a toll-free number that provides the customer with this information;

(L)

a toll-free telephone number or the equivalent (such as WATS or collect calls) where customers may call to report service problems or make billing inquiries;

(M)

a statement that utility services are provided without discrimination as to a customer's race, nationality, color, religion, sex, or marital status, and a summary of the company's policy regarding the provision of credit history based upon the credit history of a customer's former spouse;

(N)

notice of any special services such as readers or notices in Braille, if available, and the telephone number of the text telephone for the deaf at the commission; and

(O)

how customers with physical disabilities, and those who care for them, can identify themselves to the utility so that special action can be taken to appropriately inform these persons of their rights.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 16, 1999.

TRD-9902220

Rhonda Dempsey

Rules Coordinator

Public Utility Commission of Texas

Effective date: May 6, 1999

Proposal publication date: December 11, 1998

For further information, please call: (512) 936-7308