NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5323
SPONSOR: Lucas TITLE OF BILL:
An act to amend the public service law, in relation to the establishment
of reduced residential rates for electric and natural gas service to
low-income customers
PURPOSE OF BILL:
The bill is designed to protect seniors, the disabled and other persons
who receive certain benefits and supports for needy families from the
inordinately high electric and gas rates in New York State and to
prevent vulnerable persons from having their utilities shut off, causing
health and economic hardship to such consumers.
SUMMARY OF PROVISIONS OF BILL:
Section one amends the Public Service Law by adding a new subdivision 16
to section 65.
Paragraph (a) provides for the state's electric and gas corporations to
establish and continue reduced rate schedules for low-income customers
of between 25T to 35% of applicable charges.
Paragraph (b) sets forth the eligibility criteria for such reduced
rates, to be established for any customer who receives benefits from
Supplemental Social Security for the Aged or Disabled, Temporary Assist-
ance to Need: Families, Safety Net Assistance, Supplemental Nutrition
Assistance (SNAP, medical assistance, Home Energy Assistance (HEAP),
telephone Lifeline Assistance and any additional programs or higher
income standards approved by the Public Service Commission (PSC).
Paragraph (c) requires providers of electric and gas service to cooper-
ate with the PSC and local social service districts and other agencies
in the certification and recertification of eligible customer.
Paragraph (d) sets forth criteria for application forms and the
provision of regarding the availability of reduced rates.
Paragraph (e) directs the mitigate the impact of such reduced residen-
tial rates to eligible customers through various mechanisms at the
disposal of the PSC within its regulatory and rate setting authority.
Section 2 amends Article 4 of the Public Service Law by adding a new
section 66-u, reduced residential rates for electric and natural gas
service to low-income customers.
Section 3 of the bill is the effective date.
JUSTIFICATION:
Utility service is an absolute necessity of life, regardless of a house-
hold's income level. Lives, are threatened when people don't have safe,
reliable access to electricity, heating, and water supply. Society pays
dearly when terminations occur. These added costs are reflected in high-
er emergency public assistance and medical care, increased homelessness,
the illness or death of vulnerable people, and the cost of putting out
fires due to the use of other means of light and heat ouch as the use of
candles.
New York electric utility rates for residential customers are 50's high-
er than the national average. That is simply not affordable for many
customers.
Furthermore, Shut offs and Shutoff notices place many customers with
unaffordable bills in jeopardy of losing essential utility services. In
addition, threats of utility shutoffs add extreme stress and compound
many families and seniors' already precarious financial circumstances.
Utility shutoff threats and actual shutoffs often can spiral into crisis
situations, create dangerous conditions in homes and apartment building,
which could result in the loss of life or other serious harm to custom-
ers and their neighbors.
Typically, shutoff notices and shutoff surge in the months of April,
May, and June, otherwise known as "Shutoff Season." Consequently, it
becomes even more important that low-income customers, eligible seniors
and disabled parsons and others who are Eligible for assistance receive
some relief from 17,a,: York's utility rates, which are the highest in
the nation.
The legislation is necessary to assist New York families, seniors, the
disabled and other low-income persons and cushion the in from New York's
inordinately high Electric and gas rates, which will in turn protect
them and the State's finances from the hardships and costs that ensue
when people's utility service - is not affordable.
LEGISLATIVE HISTORY:
2022-22: S3298 - REFERRED TO ENERGY AND TELECOMMUNICATIONS
2019/20: S.1621 - REFERRED TO ENERGY AND TELECOMMUNICATIONS
2017/18: 5.2878 - Energy and Telecommunications
2015-16: S.5819A - Amend and Recommit to Energy and Telecommunications
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None. Significant savings to consumers on a low- or fixed-income through
the creation of reduced rates for these eligible consumers. In addi-
tion, the bill would reduce expenditures to the state and localities for
emergency utility assistance provided under Social Services L131-s, by
reducing the need for, and the amount of such assistance. That program
requires payment of up to four months bills for applicants whose service
is, or is about to be, shut off for nonpayment. The low-income rates
proposed in the bill should enable many customers to avoid seeking
assistance, and for those who do, the amount of aid needed will be
significantly less.
EFFECTIVE DATE:
This act shall take effect on the sixtieth day after enactment.
STATE OF NEW YORK
________________________________________________________________________
5323
2023-2024 Regular Sessions
IN ASSEMBLY
March 7, 2023
___________
Introduced by M. of A. LUCAS -- read once and referred to the Committee
on Energy
AN ACT to amend the public service law, in relation to the establishment
of reduced residential rates for electric and natural gas service to
low-income customers
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 65 of the public service law is amended by adding a
2 new subdivision 17 to read as follows:
3 17. Reduced residential rates for electric and natural gas service to
4 low-income customers. (a) Electric and gas corporations shall establish
5 and continue reduced rate schedules for low-income electric and natural
6 gas customers. The average effective rate reduction shall not be less
7 than twenty-five percent or more than thirty-five percent of the reven-
8 ues that would have been produced for the same billed usage by other
9 residential customers receiving full service from the utility who are
10 not eligible for the reduced rate.
11 (b) Reduced residential rates for electric and natural gas service
12 shall be established for any customer who receives benefits from the
13 supplemental security income program for the aged or disabled or other
14 persons, the temporary assistance to needy families program, safety net
15 assistance, the supplemental nutrition assistance program, medical
16 assistance, the home energy assistance program, the telephone lifeline
17 assistance program, and any other additional assistance program or
18 income standard approved by the commission.
19 (c) Providers of electric and natural gas service shall cooperate with
20 the commission and social services districts and other agencies to
21 certify and recertify customer eligibility through privacy protected
22 data exchanges approved by the commission to achieve efficient enroll-
23 ment of eligible customers.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD06370-01-3
A. 5323 2
1 (d) Providers of electric and natural gas service shall strive to
2 provide reduced residential rates to all customers eligible for them,
3 and shall provide application forms for reduced rates to eligible low-
4 income customers on their websites, at their offices, and by other
5 means. Information regarding the availability and eligibility standards
6 for reduced rates shall be provided to residential customers at the time
7 of service initiation, in bill inserts, in communications to customers
8 in arrears, and by other means required or approved by the commission.
9 (e) The incremental revenue effects of enhancement to low-income rate
10 programs under this section shall be deferred for subsequent rate making
11 treatment and approval by the commission. The revenue impact of such
12 rate reduction shall be mitigated by (i) applying any earnings of the
13 utility above the allowed return on equity set in the most recent rate
14 case, (ii) disallowing any premium above the rate of return allowed for
15 not filing a rate case or for sharing of overearnings, (iii) utilizing
16 any uncommitted funds available from current surcharges allowed by the
17 commission and not expressly authorized by statute, (iv) disallowing
18 recovery from ratepayers of any costs of executive compensation bonuses.
19 After such mitigation measures, and other mitigation measures which the
20 commission may approve, any shift of revenue responsibility to other
21 customers due to the revenue effects of low-income rates shall not be
22 borne solely by any single class of customer.
23 § 2. The public service law is amended by adding a new section 66-u to
24 read as follows:
25 § 66-u. Reduced residential rates for electric and natural gas service
26 to low-income customers. 1. The commission shall require electric and
27 natural gas corporations to establish and continue programs of rate
28 reduction and other assistance to low-income residential electric and
29 natural gas customers, the revenue impact of which shall not be borne
30 solely by any single class of customer. The commission shall ensure
31 appropriate levels of rate reduction for low-income electric and natural
32 gas customers to mitigate hardship, which shall not be less than twen-
33 ty-five percent or more than thirty-five percent of the revenues that
34 would have been produced for the same billed usage by other residential
35 customers receiving full service from the utility who are not eligible
36 for the reduced rate. In establishing the appropriate percentage
37 reduction the commission shall ensure to the extent feasible that low-
38 income ratepayers are not jeopardized or overburdened by rates for elec-
39 tric and natural gas service.
40 2. The commission shall establish customer income and categorical
41 eligibility standards for reduced rates, which shall include, without
42 limitation, any customers who receive benefits from the supplemental
43 security income program for the aged or disabled or other persons, the
44 temporary assistance to needy families program, safety net assistance,
45 the supplemental nutrition assistance program, medical assistance, the
46 home energy assistance program, and the telephone lifeline assistance
47 program.
48 3. The commission shall promote full penetration of the reduced rate
49 assistance to all eligible customers through privacy protected data
50 exchanges with agencies providing assistance to categorically eligible
51 customers to achieve efficient enrollment, certification, and periodic
52 recertification of eligibility.
53 4. The commission shall require providers of electric and natural gas
54 service to provide information and application forms for reduced rates
55 to eligible low-income customers on their websites, at their offices,
56 and by other means, and to provide information regarding the availabili-
A. 5323 3
1 ty and eligibility standards for reduced rates to residential customers
2 at the time of service initiation, in bill inserts, in communications
3 with customers in arrears, and by other means required or approved by
4 the commission.
5 5. The commission shall require electric and natural gas corporations
6 to establish reduced rates pursuant to this section to be effective no
7 later than January first, two thousand twenty-four, and to file periodic
8 reports at least annually regarding the number of eligible customers
9 receiving reduced rates, utility efforts to provide reduced residential
10 rates to all customers eligible for them, and other information deemed
11 necessary or appropriate by the commission for the efficient adminis-
12 tration of the reduced rates.
13 6. The commission shall require that the incremental revenue effects
14 of enhancement to low-income rate programs under this section be
15 deferred for subsequent rate making treatment. The incremental revenue
16 impact of such rate reductions shall be mitigated by:
17 (a) applying any earnings of the utility above the allowed return on
18 equity set in the most recent rate case, pursuant to subdivision twenty
19 of section sixty-six of this article;
20 (b) disallowing any rate of return premium for not filing a rate case
21 or for sharing of overearnings after rates are set;
22 (c) utilizing any uncommitted revenues from surcharges allowed by the
23 commission but not expressly authorized by statute; and
24 (d) disallowing executive compensation or bonuses not essential to the
25 provision of safe and adequate service.
26 After applying revenues from such sources, and other mitigation meas-
27 ures which the commission may approve, any shift of revenue responsibil-
28 ity to other customers due to the revenue effects of low-income rates
29 shall not be borne solely by any single class of customer.
30 § 3. This act shall take effect on the sixtieth day after it shall
31 have become a law.
