Avangrid’s Connecticut utilities are fighting a $4.48 million civil penalty recently levied against them by the state’s Public Utilities Regulatory Authority, saying that they were in compliance with PURA’s customer shut-offs during the pandemic.
Regulators concluded at the end of October that the utility’s shut-offs violated Connecticut’s notice requirements.
Avangrid, the parent company of United Illuminating, Southern Connecticut Gas, and Connecticut Natural Gas, also claims some of the statements PURA made in its proposed final decision were damaging to the company’s reputation.
Avangrid’s response was filed with PURA earlier this week, following an Oct. 31 notice of violation and proposed final decision, which also alleged that Avangrid violated state statute when its employees referred accounts to third-party collection agencies without providing adequate notice to those residential customers per an interim decision issued in April 2020.
In the April 2020 interim decision, PURA required the establishment of a payment program for customers requesting financial assistance during the pandemic that would include an option that they could pay what they can, when they can. The Authority says there were specific requirements for these public service utilities to communicate this program to their customers – including “proactively and directly” contacting any residential, commercial, or industrial customer after the first missed payment.
“The Interim Decision did not prohibit all collection activities during the time in which it was in effect. Whereas the Interim Decision expressly prohibited account shut-offs until further order of the Authority, the Interim Decision did not prohibit referring accounts to legal collections; collecting payments from judgments entered prior to the COVID-19 pandemic; or seeking wage garnishments against judgments that entered in lawsuits filed before the implementation of the Shut-off Moratorium,” according to a letter filed by attorneys for Avangrid. “The Authority acknowledges that prohibiting such collections practices is “not supported by the plain language of the Authority’s orders”, yet, throughout the Draft Decision, the Authority criticizes Avangrid for the above-referenced collections practices, although there is no legal basis for doing so.”
Avangrid wants PURA to modify the Oct. 31 decision to reflect that it complied with PURA’s directives and state statutes “in that the accounts were not reported to credit-rating agencies until after accounts were more than 120 days past due.”
In the letter, drafted by lawyers from Keegan Werlin LLP, Avangrid takes issue with PURA’s references to the garnishment of wages as “one of the most egregious collection practices a company can engage in.”
Avangrid’s attorneys said that this particular statement is damaging to the company as wage garnishment was not prohibited by PURA’s April 2020 decision.
“Wage garnishment is a last resort to collect payment from customers and numerous steps are taken to work with customers before this stage. As a result, wage garnishments do not trigger the notice provision of the COVID-19 Payment Program in the Interim Decision,” the letter states. “The bill has already been adjudicated into a court-ordered judgment, after many months or years of unpaid utility bills. Offering COVID-19 Payment Programs after failing to pay a judgment would result in starting the collections process from the beginning, to before a lawsuit was filed. Further, many of the wage garnishments were for inactive accounts, which are accounts that do not currently have service with Avangrid. The Interim Decision (including the COVID-19 Payment Program) applies only to ‘customers,’ and not ‘inactive accounts. ‘Inactive accounts’ are not customers of Avangrid because they are no longer being furnished electric or gas service.”
According to Avangrid’s letter, “97 of the 203 wage garnishment accounts were inactive accounts against whom judgment entered before the Interim Decision entered and the COVID-19 Payment Program became available; 102 of the 203 wage garnishment accounts were active accounts, all of whom directly received notice of the COVID-19 Payment Plan consistent with the Interim Decision…”
In a Nov. 14 letter filed by Attorney General William Tong, Tong supports PURA’s efforts to look into utility collections practices.
“Judgments and wage garnishments for delinquent utility accounts during the pandemic likely caused financial hardship to consumers already struggling to make ends meet. Utility ratepayers have been overburdened with escalating utility rates since the onset of the pandemic,” the letter states. “The Attorney General remains extremely concerned with rising utility rates in the face of economic insecurity, and generally supports PURA’s efforts to hold the utilities accountable for equitable collections practices that adhere to Connecticut law.”
Connecticut Consumer Counsel Claire Coleman also submitted a statement in which she voices her support for several PURA initiatives set forth in its Oct. 31 proposed final decision including a requirement that the state’s public utilities to file any changes to their collection practices each year as well as a requirement that utilities provide a cost-benefit analysis justifying any wage garnishment as a collection tool.
PURA broke down the penalties to be disbursed in the following way: UI will pay $2.3 million, SCG will pay $1 million, and CNG will pay $1.1 million – all of which will go toward Operation Fuel, a program for those residents who are struggling financially.