Minnesota Legislature
HF 2537
1st Engrossment - 88th Legislature (2013 - 2014) Posted on 03/12/2014 12:42pm
Bill Text Versions
| Engrossments | ||
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| Introduction | Posted on 02/27/2014 | |
| 1st Engrossment | Posted on 03/12/2014 |
Current Version - 1st Engrossment
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A bill for an act
relating to energy; regulating terms of sale and service and the discontinuance of
service during the heating season with respect to residential propane customers;
requiring registration of and reporting by propane distributors; amending
Minnesota Statutes 2012, sections 239.051, subdivision 29; 239.785, by adding
a subdivision; 325E.027; proposing coding for new law in Minnesota Statutes,
chapter 216B.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
new text begin
[216B.0991] DEFINITIONS.
new text end
new text begin Subdivision 1. new text end
new text begin Scope. new text end
new text begin
For the purposes of sections 216B.0991 to 216B.0998, the
terms defined in this section have the meanings given them.
new text end
new text begin Subd. 2. new text end
new text begin Customer. new text end
new text begin
"Customer" means a person who purchases or signs a contract
to purchase propane from a propane distributor for residential heating.
new text end
new text begin Subd. 3. new text end
new text begin Delinquent. new text end
new text begin
"Delinquent" means a customer's account with a propane
distributor that is in arrears because the customer has failed to pay a valid bill or charge in
full within 20 days of its due date.
new text end
new text begin Subd. 4. new text end
new text begin Discontinuance or discontinue. new text end
new text begin
"Discontinuance" or "discontinue" means
the refusal of a propane distributor to deliver propane to a customer previously receiving
residential heating service from the propane distributor.
new text end
new text begin Subd. 5. new text end
new text begin Heating season. new text end
new text begin
"Heating season" means the time period from October
15 through April 15.
new text end
new text begin Subd. 6. new text end
new text begin LIHEAP. new text end
new text begin
"LIHEAP" means the low-income home energy assistance
program.
new text end
new text begin Subd. 7. new text end
new text begin Low-income customer. new text end
new text begin
"Low-income customer" means a customer whose
household income is at or below 50 percent of the state median household income.
new text end
new text begin Subd. 8. new text end
new text begin Propane distributor. new text end
new text begin
"Propane distributor" means a person who:
new text end
new text begin
(1) sells propane at retail to customers; and
new text end
new text begin
(2) received more than $200,000 in payments from the LIHEAP program for
propane delivered during the previous heating season; or
new text end
new text begin
(3) received less than $200,000 in payments from the LIHEAP program for propane
delivered during the previous heating season, and meets one of the following conditions:
new text end
new text begin
(i) markets propane under a single brand and the aggregate amount of payments
received from the LIHEAP program for propane delivered during the previous heating
season by all entities selling propane under that brand within the state exceeds $200,000;
new text end
new text begin
(ii) is organized as a cooperative association under chapter 308A or 308B; or
new text end
new text begin
(iii) operates a pipeline, rail or pipeline terminal, or bulk plant at which propane is
received.
new text end
new text begin
For the purposes of this subdivision, "bulk plant" means an aboveground or underground
tank facility with a storage capacity of more than 1,000 gallons that dispenses propane
into cargo tanks for transportation and sale at another location.
new text end
new text begin Subd. 9. new text end
new text begin Residential heating service. new text end
new text begin
"Residential heating service" means the
provision of the primary source of heat for the interior of a residential structure.
new text end
Sec. 2.
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[216B.0992] PRICE AND FEE DISCLOSURE.
new text end
new text begin
A propane distributor must prepare a document listing the current per-gallon price of
propane and all additional charges, fees, and discounts that pertain to residential heating
service. The document must be:
new text end
new text begin
(1) made available to a person upon request;
new text end
new text begin
(2) posted on the propane distributor's Web site, if applicable; and
new text end
new text begin
(3) provided to a new customer before residential service is initiated.
new text end
Sec. 3.
new text begin
[216B.0993] BUDGET PAYMENT PLAN.
new text end
new text begin
(a) A propane distributor must offer a reasonable and effective budget payment plan
to a customer whose payments for residential heating service are current, or who has
entered into and is complying with a contract with the propane distributor for residential
heating service, without regard to the length of time the customer has purchased propane
from the propane distributor.
new text end
new text begin
(b) A budget payment plan must levelize a customer's estimated annual propane bill
by dividing it into 12 equal monthly payments.
new text end
new text begin
(c) A propane distributor must notify a customer on a budget payment plan within
30 days of a price or fee change that may affect the monthly amount due under the budget
payment plan by more than 20 percent.
new text end
Sec. 4.
new text begin
[216B.0994] DELINQUENT ACCOUNT; PAYMENT AGREEMENT.
new text end
new text begin
(a) A propane distributor must offer a reasonable payment agreement to a
low-income customer whose account is delinquent that allows the customer to pay the
delinquent bill over time. The propane distributor and the customer may negotiate the
terms of a payment agreement to arrive at a mutually acceptable agreement. A reasonable
payment agreement must consider at least the following factors:
new text end
new text begin
(1) the amount that is delinquent;
new text end
new text begin
(2) the customer's financial resources and circumstances;
new text end
new text begin
(3) the reason the account became delinquent; and
new text end
new text begin
(4) the customer's eligibility for LIHEAP and other emergency energy assistance
programs.
new text end
new text begin
(b) A reasonable payment agreement must have a term no less than six months.
new text end
new text begin
(c) A reasonable payment agreement may not require a customer to pay more than
ten percent of the customer's monthly household income toward current and past propane
bills, unless the customer agrees to pay more.
new text end
new text begin
(d) A customer who has entered into a payment agreement with a propane distributor
may request a modification of the terms of the payment agreement if the customer's
financial circumstances have changed or the customer is unable to make timely payments.
new text end
Sec. 5.
new text begin
[216B.0995] SERVICE DISCONTINUANCE.
new text end
new text begin Subdivision 1. new text end
new text begin During heating season. new text end
new text begin
(a) A propane distributor may not discontinue
residential heating service to a customer during the heating season if the customer:
new text end
new text begin
(1) is a low-income customer; and
new text end
new text begin
(2) has entered into and made reasonably timely payments under a payment
agreement.
new text end
new text begin
(b) A propane distributor may verify income on forms it provides or from
information obtained from the local energy assistance provider. A customer is deemed
to be a low-income customer if the customer receives any form of public assistance,
including energy assistance, whose income eligibility threshold is set at or below 50
percent of the state median household income.
new text end
new text begin Subd. 2. new text end
new text begin Notice. new text end
new text begin
A propane distributor must, between September 1 and October
15 each year, send by regular mail to all customers a written summary of the provisions
of this section.
new text end
new text begin Subd. 3. new text end
new text begin Refusal to deliver. new text end
new text begin
(a) A propane distributor may refuse to deliver propane
to a customer if the customer's account is delinquent and the customer has failed to pay
two consecutive monthly payments under a payment agreement entered into with the
propane distributor.
new text end
new text begin
(b) A refusal to deliver during the heating season must not occur on a weekend,
holiday, the day before a holiday, or when the propane distributor's offices are closed.
new text end
new text begin
(c) This subdivision shall not apply to any discontinuance of propane service made
necessary for reasons of the immediate health or safety of the customer or the general public.
new text end
new text begin Subd. 4. new text end
new text begin Discontinuation notice. new text end
new text begin
Before discontinuing residential heating service
to a customer during the heating season, a propane distributor must send a written notice
of discontinuance to the customer by regular mail at least 14 days, but not more than 20
days, prior to the date of discontinuance. The discontinuance notice must include:
new text end
new text begin
(1) the delinquent amount and the date on which propane delivery will be
discontinued unless the customer pays the delinquency in full by a specified date;
new text end
new text begin
(2) a list of local organizations that may provide financial assistance to customers
who cannot pay their energy bills; and
new text end
new text begin
(3) a statement explaining options a customer has to secure continued supply of
propane, including, but not limited to, entering into a payment agreement with the propane
distributor.
new text end
Sec. 6.
new text begin
[216B.0996] NONDISCRIMINATION.
new text end
new text begin
A propane distributor that offers customers payment and service options, including,
but not limited to, prepurchase contracts, keep-fill delivery, and credit payments, must
offer the same terms and conditions to all new and existing customers, including residents
of mobile home parks.
new text end
Sec. 7.
new text begin
[216B.0997] TERMS OF SALE.
new text end
new text begin Subdivision 1. new text end
new text begin Minimum delivery. new text end
new text begin
(a) During the heating season, a propane
distributor may not require a customer to purchase, per delivery, more than:
new text end
new text begin
(1) 150 gallons of propane, if the customer's propane tank has a capacity below
500 gallons; or
new text end
new text begin
(2) 200 gallons of propane, if the customer's propane tank has a capacity of 500
gallons or more.
new text end
new text begin
(b) At times other than during the heating season, a propane distributor may not
require a customer to purchase, per delivery, more than the lesser of 250 gallons of
propane or 35 percent of the capacity of the customer's propane tank.
new text end
new text begin
(c) The purchase limits in this subdivision apply to the initial delivery of propane
following installation of a customer's propane tank.
new text end
new text begin
(d) A propane distributor may not charge an additional minimum delivery fee
to a customer because the customer has purchased propane in the minimum amounts
allowed under this subdivision, unless the customer is making payments under a payment
agreement or budget payment plan and the charge for the minimum delivery fee is
included in the payment agreement or budget payment plan. If a customer has not entered
a payment agreement or budget payment plan, a propane distributor must allow the
customer to pay for any minimum service delivery fee in four monthly installments.
new text end
new text begin Subd. 2. new text end
new text begin Cannot refuse certain sales. new text end
new text begin
(a) A propane distributor with an available
supply of propane must not refuse to sell propane to a customer who:
new text end
new text begin
(1) pays the lawful price upon delivery in cash, by certified or cashier's check, or by
commercial money order or its equivalent; or
new text end
new text begin
(2) receives energy assistance from LIHEAP or a governmental or private agency
that has funds available to pay for a delivery.
new text end
new text begin
(b) A propane distributor must apply 75 percent of a cash payment made by a customer
whose account is delinquent toward the current propane delivery bill and 25 percent to
the delinquent bill until the delinquent amount owed is paid in full. The distributor must
deliver to the customer the quantity of gas purchased by 75 percent of the cash payment.
new text end
new text begin Subd. 3. new text end
new text begin Minimal usage charge. new text end
new text begin
No propane distributor may charge a fee to a
customer for failing to consume a minimal amount of propane, as set by the propane
distributor, over a given period of time.
new text end
new text begin Subd. 4. new text end
new text begin LIHEAP participation and payments. new text end
new text begin
A propane distributor must make
available to its customers information regarding LIHEAP, including income eligibility
and contact information for organizations accepting LIHEAP applications, upon request
and with each bill and receipt for propane delivered to a customer. A propane distributor
must accept payments from LIHEAP and must deliver the full amount of propane and any
related cost or service paid for by LIHEAP funds.
new text end
new text begin Subd. 5. new text end
new text begin Third-party credit disclosure. new text end
new text begin
A propane distributor must not make
known the names of past or present delinquent customers to other propane distributors,
except in the course of a routine credit check performed when a prospective customer
applies for credit privileges.
new text end
new text begin Subd. 6. new text end
new text begin Security deposit. new text end
new text begin
During the heating season, a propane distributor may not
require a customer eligible to receive heating assistance under LIHEAP to pay a security
deposit as a condition of service. At all other times, a security deposit may not exceed the
lesser of $200 or five percent of the customer's estimated annual heating bill.
new text end
Sec. 8.
new text begin
[216B.0998] REGISTRATION; REPORTING.
new text end
new text begin Subdivision 1. new text end
new text begin Registration. new text end
new text begin
Annually by September 1, a propane distributor shall
register with the department on a form prescribed by the commissioner. A propane
distributor may not sell propane at retail in this state unless the propane distributor has
received a registration certificate from the commissioner.
new text end
new text begin Subd. 2. new text end
new text begin Reporting. new text end
new text begin
(a) Annually by September 1, a propane distributor must
submit the following information to the commissioner:
new text end
new text begin
(1) the amount of fees associated with propane delivery to a customer, including, but
not limited to, tank purchasing, leasing, installation, inspection, pump-out and pick-up
fees, emergency and after-hours delivery fees, and meter service fees;
new text end
new text begin
(2) a copy of the standard contract between the propane distributor and a customer;
new text end
new text begin
(3) terms and conditions of payment and credit options made available to a customer,
including but not limited to prepurchase, fixed-price, and capped-price options, payment
agreements and budget payment plans, and price discounts; and
new text end
new text begin
(4) the capacity of propane storage located on site at the propane distributor's
place of business, and the capacity of any other storage locations owned or leased by
the propane distributor.
new text end
new text begin
(b) Beginning at the start of the heating season of 2014-2015, and continuing each
subsequent heating season, a propane distributor must, on a form prescribed by the
commissioner, submit to the commissioner each week the average wholesale price the
distributor paid for propane delivered that week, and the average retail price per gallon
charged by the propane distributor to a customer.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment and
the initial registration and reporting required must be submitted on or before September
1, 2014.
new text end
Sec. 9.
Minnesota Statutes 2012, section 239.051, subdivision 29, is amended to read:
Subd. 29.
Refinery, terminal.
"Refinery" or "terminal" means a petroleum refinery,
pipeline terminal, river terminal, storage facility, or other point of origin where new text begin liquefied
petroleum gas or new text end petroleum products are manufactured, or imported by rail, truck, barge, or
pipe; and held, stored, transferred, offered for distribution, distributed, offered for sale, or
sold. For the purpose of restricting petroleum product blending, this definition includes all
refineries and terminals within and outside of Minnesota, but does not include a licensed
distributor's bulk storage facility that is used to store petroleum products for which the
petroleum inspection fee charged under this chapter is either not due or has been paid.
Sec. 10.
Minnesota Statutes 2012, section 239.785, is amended by adding a subdivision
to read:
new text begin Subd. 7. new text end
new text begin Notification of product unavailability; terminal operators. new text end
new text begin
A person
who operates a terminal where liquefied petroleum gas is loaded into transport trucks for
subsequent distribution shall notify the commissioner within 24 hours when liquefied
petroleum gas is physically not available for sale to licensed distributors.
new text end
Sec. 11.
Minnesota Statutes 2012, section 325E.027, is amended to read:
325E.027 DISCRIMINATION PROHIBITION.
(a) No dealer or distributor of liquid propane gas or number 1 or number 2 fuel oil
who has signed a low-income home energy assistance program vendor agreement with the
Department of Commerce may refuse to deliver liquid propane gas or number 1 or number
2 fuel oil to any person located within the dealer's or distributor's normal delivery area
who receives direct grants under the low-income home energy assistance program if:
(1) the person has requested delivery;
(2) the dealer or distributor has product available;
(3) the person requesting delivery is capable of making full payment at the time of
delivery; and
(4) the person is not in arrears regarding any previous fuel purchase from that dealer
or distributor.
(b) A dealer or distributor making delivery to a person receiving direct grants
under the low-income home energy assistance program may not charge that person any
additional costs or fees that would not be charged to any other customer and must make
available to that person any discount program on the same basis as the dealer or distributor
makes available to any other customer.
new text begin
(c) The commissioner of commerce may enforce this section using any of the
authority granted to the commissioner under section 45.027.
new text end
Sec. 12. new text begin EFFECTIVE DATE.
new text end
new text begin
Sections 1 to 11 are effective the day following final enactment.
new text end