SF 2308 (LSB 6121XS (2) 91)

SENATE FILE 2308

BY  WESTRICH

A BILL FOR

An Act relating to certain charges for utility service.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 476.1A, subsection 1, Code 2026, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  f.  Allowable charges to customers, as set forth in section 476.6B.
    Sec. 2.  Section 476.1B, subsection 1, Code 2026, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  g.  Allowable charges to customers, as set forth in section 476.6B.
    Sec. 3.  Section 476.1C, subsection 1, paragraph a, Code 2026, is amended to read as follows:
   a.  Are not subject to the regulation authority of the utilities commission under this chapter unless otherwise specifically provided. Sections 476.6B, 476.10, 476.20, 476.21, and 476.51 apply to such gas utilities.
    Sec. 4.  NEW SECTION.  476.8A  Allowable charges to customers.
   1.  The general assembly finds the following:
   a.  Water, electricity, and natural gas are essential services necessary for life, health, and safety.
   b.  Public utility customers in Iowa generally have no meaningful ability to choose among competing providers due to the monopolistic nature of utility service territories.
   c.  Utility bills in Iowa increasingly include charges that are not directly related to the actual consumption of utility service, including but not limited to franchise fees, meter fees, customer charges, and per-unit or per-meter surcharges.
   d.  Nonusage fees described in paragraph “c” significantly increase utility bills without increasing the amount of utility service received.
   e.  Iowa residents currently pay among the highest utility rates in the nation, and additional nonusage fees further burden households, renters, homeowners, and small businesses.
   2.  a.  Notwithstanding any other provision of law, a public utility shall not impose, collect, or bill any nonusage fee or surcharge to a customer. A utility bill issued to a customer in this state shall consist of only the following charges, regardless of the number of meters serving a property or the number of dwelling units or tenants served by a single connection:
   (1)  Usage charges based on actual consumption.
   (2)  Late payment charges, if applicable.
   b.  A public utility shall not condition the provision or continuation of service on payment of any nonusage fee.
   3.  Notwithstanding any other provision of law, a utility shall not recover, pass through, itemize, or otherwise charge a customer for any franchise fee, franchise assessment, or similar payment made to a municipality or other governmental entity. Any franchise fee obligation shall be borne by the utility as a cost of doing business and shall not be recovered directly or indirectly from customers.
   4.  a.  The commission shall adopt rules as necessary to implement and enforce this section.
   b.  The commission shall review all existing tariffs, rate schedules, and billing practices to ensure compliance with this section.
   c.  Any tariff, rule, or billing practice inconsistent with this section is void.
   5.  a.  A public utility that violates this section is subject to all the following:
   (1)  Administrative penalties as determined by the commission.
   (2)  Refunds or bill credits to affected customers.
   (3)  Enforcement action by the attorney general under applicable consumer protection laws.
   b.  Each billing statement containing a prohibited fee constitutes a separate violation.
   6.  Notwithstanding section 476.1, subsection 3, this section applies to all municipally owned waterworks, waterworks having less than two thousand customers, joint water utilities established pursuant to chapter 389, rural water districts incorporated and organized pursuant to chapters 357A and 504, and cooperative water associations incorporated and organized pursuant to chapter 499 in addition to other public utilities providing gas or electric service.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to certain charges for utility service.
   The bill provides legislative findings stating that water, electricity, and natural gas are essential services, that utility customers generally lack choice due to the monopolistic nature of service territories, that utility bills increasingly include nonusage fees that significantly increase costs without increasing service, and that such nonusage fees place a burden on Iowa residents.
   The bill prohibits a public utility from imposing, collecting, or billing any nonusage fee or surcharge to a customer, and provides that a utility bill may include only charges based on actual consumption and late payment charges. The bill prohibits a public utility from conditioning the provision or continuation of service on the payment of a nonusage fee.
   The bill prohibits utilities from charging customers, through any method, for franchise fees or similar payments made to a municipality or governmental entity.
   The bill directs the Iowa utilities commission to adopt rules to implement and enforce the new bill and to review all existing tariffs, rate schedules, and billing practices for compliance. Any tariff, rule, or billing practice inconsistent with the bill is void.
   The bill provides enforcement mechanisms for violations, including administrative penalties determined by the commission, refunds or bill credits to affected customers, and enforcement actions by the attorney general. Each billing statement containing a prohibited fee constitutes a separate violation.
   The bill applies to certain public utilities, including those that are otherwise not subject to full rate regulation by the utilities commission.