BILL ANALYSIS Ó
AB 1180
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Date of Hearing: January 21, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
1180 (Cristina Garcia) - As Amended January 13, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill allows a water corporation to seek approval from the
Public Utilities Commission (PUC) to operate a pilot program
designed to evaluate customer interest in bill paying options,
including credit card and debit card payments. Specifically,
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this bill:
1)Authorizes a water corporation with more than 10,000 service
connections to seek approval from the PUC to operate the pilot
program through a general rate case. Requires the PUC to
ensure alternative payment options do not increase or decrease
the water corporations' rate of return.
2)Requires the pilot program to be designed to evaluate customer
interest and asses the cost-effectiveness and public interests
served.
3)Requires the PUC to allow water corporations to recover the
reasonable costs of providing bill payment options in its
rates, however, costs may not be recovered from customers
participating in the California Alternative Rates for Energy
(CARE) program.
4)Prohibits the PUC from requiring a water company to impose a
transaction fee on its customers.
5)By July 1, 2020, requires the PUC, in consultation with the
Low-Income Oversight Board, to submit a report to the
Legislature that asses the impacts and effectiveness of the
program, as specified, and evaluates whether a transaction fee
on customers paying by credit or debit card is in the public
interest.
6)Sunsets the pilot program authority on January 1, 2022.
FISCAL EFFECT:
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Increased costs for the PUC (special fund) of approximately
$130,000 to monitor the rate case and collect and analyze data
for the report.
COMMENTS:
1)Purpose. According to the author, current law is discouraging
the payment of utility bills by credit or debit card at a time
when more people are using them to pay recurring bills. This
bill allows a water utility to waive the transaction fee for
customers paying with credit or debit cards. Additionally,
this bill requires a robust analysis of the alternative
payment pilot projects to determine the impacts on customers
and inform future policy decisions.
2)Background. Current law requires electric, natural gas, and
water investor-owned utilities (IOUs) to seek PUC approval to
offer credit/debit card payment options. Current also law
requires IOUs to charge customers a transaction fee to cover
the bank interchange fees associated with the transaction.
The transaction fee typically ranges from $2.00 to $3.00 per
payment.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
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