Provides for notification to utility customers of their right to direct access to public service commission complaint procedures without arbitration or court proceedings.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A1120
SPONSOR: Kellner (MS) TITLE OF BILL: An act to amend the public service law, in relation to
notification to utility customers of their right to direct access to
public service commission complaint procedures without arbitration or
court proceedings
PURPOSE OR GENERAL IDEA OF BILL: To ensure that residential utility
customers, including submetered customers, are provided annual notice of
their right to access the Public Service Commission's complaint process.
SUMMARY OF SPECIFIC PROVISIONS: -Amends subdivision 1 of section 43
of the public service law, as added by chapter 713 of the laws of 1981
to require the Public Service Commission to maintain regulations requir-
ing municipalities and utilities annually notify all residential utility
customers, including submetered customers, that the complaint handling
procedures of the Commission can be invoked for an administrative deter-
mination of their complaint by telephone call, letter, online complaint
form, or a visit to the office of the Commission;
-Act taking effect on the ninetieth day after it becomes law.
JUSTIFICATION: The Public Service Commission has long had primary
jurisdiction over customer disputes regarding utility service, which are
decided administratively subject to judicial review of final decisions
under CPLR Article 78. For residential customers the requirements for
prompt and simple utility and administrative agency complaint determi-
nation procedures are now contained in the Home Energy Fair Practices
Act (HEFPA), Public Service Law (PSL) 30, et seq. PSL Section 43.1
requires all utilities, upon receiving a customer complaint, to have
procedures for a "prompt investigation of any complaint," and for
"prompt reporting to the complainant of the result of such investi-
gation." After any report of the utility adverse to the customer, the
utility is required to "inform any complainant... of the availability of
the commission's complaint handling procedures."
The bill is necessary to correct current complaint handling practices of
some providers of utility service and the Public Service Commission
(PSC) which have had the effect of diverting complaints regarding elec-
tric service to outside third parties for arbitration or adjudication or
deterring customers from lodging complaints. This impedes the provision
of service in accordance with HEFPA and thwarts the prompt and efficient
resolution of electricity customer complaints.
Before 2002, despite a longstanding regulation requiring landlords
providing submetered electric service to implement complaint procedures
"consistent with HEFPA," 16 NYCRR Part 962, some PSC orders approving
landlords' petitions for submetering approval mention complaint proce-
dures which involve third party determinations, such as arbitration or
court proceedings. despite the applicability of the PSC complaint handl-
ing procedures.
Some examples follow:
Binding arbitration by the American Arbitration Association: 2000 Hazel
Towers Submetering Order ("Upon receipt of the protest, the matter shall
be turned over to a grievance arbitrator. The arbitrator, to be selected
from the American Arbitration Association or equivalent. . . ."); 1998
Ruppert/Yorkville Towers Submetering Order ("The arbitrator, to be
selected from the American Arbitration Association or equivalent, is to
take action within a reasonable period of time....and the decision of
the arbitrator will be binding to all parties");
Non-binding arbitration: 2001 Ebbetts Field Apartments Submetering Order
("the submetering plan does not provide for binding arbitration, only
arbitration");
Arbitration followed by PSC complaint process: 2008 1 Alexander Street,
Yonkers Submetering Order ("The property manager will submit the griev-
ance to an independent arbitrator selected from the American Arbitration
Association or equivalent, at no cost to the tenant. The decision of the
arbitrator w ill be provided to the tenant promptly with notice of the
arbitration procedures. If the tenant is dissatisfied with the decision
of the arbitrator, either party may file a complaint with the Commission
pursuant to the Home Energy Fair Practices Act (HEFPA)). New York City
Landlord-tenant court proceedings: 2008 City of New York,Roosevelt Land-
ings (Eastwood) Submetering Order, ("If a resident remains dissatisfied,
the resident, within fifteen (15) days of management's response, may
request in writing that the grievance be submitted to the New York City
Civil Court Housing, Landlord/Tenant Court");
The New York City Department of Housing Development and Preservation:
1997 North Waterside Plaza Submetering Order ("If the complainant is
dissatisfied with the managing agent's response, he or she may request a
review of said determination by filing a written protest within fourteen
days from the date of the response to HPD").
These alternative venues for complaint adjudication all involve time
consuming and comparatively formal proceedings. They may also prove to
be expensive and risky, for example, if an eviction case is the forum
for resolution. These factors may serve to deter customers with merito-
rious complaints from making them, and reduce awareness at the Public
Service Commission of the nature and quality of customer service actual-
ly provided by certain utilities.
Such alternative complaint procedures are inconsistent with the Commis-
sion's primary jurisdiction over electric service and with the express
HEFPA requirements in PSL section 43 of a "prompt investigation" and
"prompt reporting of the result of such investigation," with information
provided to the customer "of the availability of the commission's
complaint handling procedures."
In 2002, the legislature adopted the Energy Consumer Protection Act, and
a new PSL Section 53 clearly eliminated any power of the PSC to allow
anything less than "full compliance" with HEFPA or to waive any
provision of HEFPA for submeterers:
§ 53. Application. For purposes of this article, a reference to a gas
corporation, an electric corporation, a utility company, or a utility
corporation shall include, but is not limited to, any entity that, in
any manner, sells or facilitates the sale or furnishing of gas or elec-
tricity to residential customers. No provision of this article or of
this chapter authorizes or permits the provision of gas or electricity
service by any such corporation or other entity in any manner other than
in full compliance with the provisions of this article or to authorize
the commission to waive compliance with any requirement of this article
for any such corporation or other entity.
After enactment of ECPA, the PSC amended its customer complaint handling
regulations to reflect that term "utilities" includes "owners of subme-
tered residential buildings." 16 NYCRR § 12.0. The Commission rule was
upheld in a court challenge, Waterside Plaza, LLC v. NYPSC (Albany Coun-
ty Index No. 7654/05), Opinion dated July 3, 2006 ("Those who submeter
electricity for sale to residential end-users are utilities within the
meaning of Article 2 of the PSL. Accordingly, those entities must
provide all HEFPA protections."). One of the HEFPA protections is
notification of customers regarding their opportunity to have a
complaint about utility service resolved by the Public Service Commis-
sion. PSL § 43
Subsequently, however, the PSC issued many submetering orders which
contain confusing references to third party arbitration or court proce-
dures for resolution of complaints regarding utility service. There is
no basis in existing law for referral of the customer's dispute to court
or arbitration. Such procedures for referral of complaints to third
parties deviate from the statutory procedures established in PSL § 43.
As a result of the practices of the PSC and submeterers, many submetered
residential customers are confused or misinformed regarding the statuto-
ry complaint procedures which actually apply to disputes regarding their
electric service.
PRIOR LEGISLATIVE HISTORY: A.736 of 2011-12; A.7867 of 2009-10
FISCAL IMPLICATIONS: To be determined.
EFFECTIVE DATE: This act shall take effect on the ninetieth day after
it shall have become a law.
