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Summit receives PSC nod to start cutoffs, late fees

Updated: Jul 29

Customers in arrears to get at least 18-month pay plan


Summit Utilities Inc. can again shut off customers for failure to pay bills and impose late-fee penalties, starting in September, after state regulators on Thursday lifted the ban imposed on the natural gas provider.

The Arkansas Public Service Commission ruled that the utility, which has not shut off customers or collected late fees since November, can restart the programs now that it has been cleared of any rules violations related to its gas-purchase and billing practices.

“Based on the evidence in the docket, the commission is directing (Summit) to resume late fees and disconnections no sooner than September 15, 2023, and to issue shut-off notices … no sooner than September 10, 2023, and directs (Summit) to offer a minimum of 18 months to customers for the delayed payment agreement (DPA),” the ruling said.

In addition, the commission ordered Summit to begin immediate communications with customers through multiple channels — using websites, social media and more traditional means such as billing inserts and direct mail — to outline its processes for restarting disconnects and late fees.

Customers with past-due balances should be targeted with individual communications by Sept. 1 with updates detailing their repayment options, the ruling said. Those communications “shall be marked so as to catch the customer’s attention,” the commission ordered.

Before any customer shutoffs occur, Summit was ordered to “contact the customer, either by telephone, in person, email with a read receipt, or with a door hanger, 48 hours in advance of disconnection.” In commission filings, Summit identified more than 47,000 homes and businesses that could be subjected to service shutdowns if the policies were in place today. Summit proposed beginning shutoffs and late fees by July 1 but that plan was rejected by the commission.

Summit said it would abide by the commission’s order. “Summit is pleased with the order issued by the Commission, and we will continue to communicate and educate customers about payment options that will best serve their needs,” Fred Kirkwood, chief customer officer, said in a statement Thursday. “We encourage those with outstanding balances to contact our customer service representatives as soon as possible to make payment arrangements, so we do not have to disconnect their service.” The attorney general also applauded the resolution proposed by the commission.

“When Summit announced that it planned to resume normal collections activities in July, I let the Public Service Commission know that it was premature,” Griffin said in a statement. “Today’s order goes a long way to ensure that customers have a reasonable opportunity to pay off properly billed amounts if they have fallen behind as a result of Summit’s billing problems.” One key issue left unresolved in Thursday’s order: whether the commission should require Summit to file quarterly reports for two years to update the commission on its billing practices. Commission staff and Griffin support the reporting requirement and Summit filed testimony Tuesday noting it does not object to the additional reporting and has been working with commission staffers to set up the process. The commission said Thursday it would issue a separate order addressing the issue.

The three commissioners rejected the attorney general’s request to allow customers who need financial assistance to pay overdue balances to establish delayed payment plans up to 36 months. Instead, the commission ordered 18-month plans for all customers, backing Summit’s contention that identifying financially challenged ratepayers would be too burdensome.

Testimony from Deputy Attorney General Charles Harder “offered no implementation plan or verification process that would be feasible for (Summit) to utilize,” the ruling said.

Commission rules typically require a 12-month period to pay bills and late fees so Thursday’s order gives Summit customers an additional six months to catch up.

State regulators discovered “hundreds of thousands” of billing complaints related to Summit in March at the urging of Attorney General Tim Griffin, according to testimony filed with the commission. Griffin’s office found that in January alone nearly every one – 99.6% — of the 128,292 bills sent to residential and small commercial customers had errors.

Summit testified in the case that $647 is the average past-due amount for all customers — homeowners and businesses — that have past-due balances and would be subject to service shutdowns. Average past-due balance is $584 for residential customers, with the lowest past-due balance of $100 and the highest past-due balance of $10,120 for Arkansas homeowners.

Thursday’s order outlined specific steps Summit must follow “to prevent an abrupt resumption of disconnections.” The utility was ordered to begin immediate customer communications “to provide a description of the phase-in for disconnections, give the customer time to contact a community action agency or other organization for available assistance if needed, and give the customer time to sign up for a [delayed payment agreement].” Complaints over Summit’s billing practices, and what customers claimed were excess charges, began in November, soon after the utility began to transition billing and customer service to its own systems after purchasing the natural gas assets and distribution lines in Arkansas from CenterPoint Energy Resources Inc. in 2021.

The Public Service Commission investigation centers on how many customers’ bills were in error, what those errors were, how many bills have been corrected and how many bills are still wrong.

Su m m i t , ba s e d n e a r Denver, Colo., serves about 425,000 customers in Arkansas.

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