Minnesota Legislature
HF 2537
as introduced - 88th Legislature (2013 - 2014) Posted on 02/27/2014 03:23pm
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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; proposing coding
for new law in Minnesota Statutes, chapter 216B.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
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[216B.0991] DEFINITIONS.
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new text begin Subdivision 1. new text end
new text begin Scope. new text end
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For the purposes of sections 216B.0991 to 216B.0998, the
terms defined in this section have the meanings given them.
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new text begin Subd. 2. new text end
new text begin Customer. new text end
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"Customer" means a person who purchases or agrees to pay
consideration for propane for residential heating service.
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new text begin Subd. 3. new text end
new text begin Delinquent. new text end
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"Delinquent" means an account that is in arrears because a
customer has failed to pay a valid bill or charge in full within 20 days of the postmark date
of the bill or charge, or by a "due date" at least 20 days after mailing or delivery which
must be written on the bill and which controls in the absence of a postmark.
new text end
new text begin Subd. 4. new text end
new text begin Discontinuance or discontinue. new text end
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"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.
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new text begin Subd. 5. new text end
new text begin Heating season. new text end
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"Heating season" means the time period from October
15 through April 15.
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new text begin Subd. 6. new text end
new text begin LIHEAP. new text end
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"LIHEAP" means the low-income home energy assistance
program.
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new text begin Subd. 7. new text end
new text begin Physician's certificate. new text end
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"Physician's certificate" means a written statement
signed by a duly licensed medical or osteopathic physician certifying that a customer or
a resident in the customer's household would face a specified immediate and serious
health hazard if propane delivery to that household were discontinued during the heating
season. The certificate is valid for 30 days or for the duration of the hazard specified in the
certificate, whichever is longer.
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new text begin Subd. 8. new text end
new text begin Propane distributor. new text end
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"Propane distributor" means a person who:
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(1) sells propane at retail to customers; and
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(2) received more than $100,000 in payments from the LIHEAP program for
propane delivered during the previous heating season; or
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(3) received less than $100,000 in payments from the LIHEAP program for propane
delivered during the previous heating season, and meets one of the following conditions:
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(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 exceeds $100,000;
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(ii) is incorporated as a cooperative association under chapter 308A or 308B; or
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(iii) operates a pipeline, rail or pipeline terminal, or bulk plant at which propane is
received.
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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.
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new text begin Subd. 9. new text end
new text begin Residential heating service. new text end
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"Residential heating service" means the
provision of the primary source of heat for the interior of a residential structure.
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Sec. 2.
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[216B.0992] PRICE AND FEE DISCLOSURE.
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A propane distributor must provide 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:
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(1) prominently displayed at the propane distributor's place of business;
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(2) made available to the general public upon request;
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(3) posted on the propane distributor's Web site, if applicable; and
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(4) provided to new customers before residential heating service is initiated.
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Sec. 3.
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[216B.0993] BUDGET PAYMENT PLAN.
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(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.
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(b) A budget payment plan must levelize a customer's estimated annual propane bill
by dividing it into 12 equal monthly payments. Any positive balance remaining at the end
of a year may, at the customer's discretion, be provided to the customer as a cash payment
or carried over as a credit on the customer's bill for the following year.
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(c) A budget payment plan must be mutually acceptable to the propane distributor
and the customer, and must be based on the financial resources and circumstances of
the customer.
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(d) 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.
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Sec. 4.
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[216B.0994] DELINQUENT ACCOUNT; PAYMENT AGREEMENT.
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(a) A customer whose account is delinquent must be given the opportunity by the
customer's propane distributor to enter into a mutually acceptable reasonable payment
agreement to pay the delinquent bill over time.
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(b) In determining a mutually acceptable payment agreement, a customer and the
customer's propane distributor must consider at least the following factors:
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(1) the amount that is delinquent;
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(2) the customer's financial resources and circumstances;
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(3) the reason the account became delinquent; and
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(4) the customer's eligibility for LIHEAP and other emergency energy assistance
programs.
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(c) A reasonable repayment agreement must have a term no less than six months.
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(d) 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 such an amount.
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Sec. 5.
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[216B.0995] DISCONTINUANCE OF SERVICE.
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new text begin Subdivision 1. new text end
new text begin Grounds for discontinuance. new text end
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(a) A propane distributor may
discontinue residential heating service without the consent of the customer if:
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(1) the customer's account is delinquent;
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(2) a notice of discontinuance has been provided to the customer at least 14 days, but
not more than 20 days, prior to the date of discontinuance; and
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(3) the customer has not entered into a payment agreement with the propane
distributor; or
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(4) the customer has failed to pay two consecutive monthly payments under a
payment agreement entered into with the propane distributor.
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(b) A customer may not be discontinued if:
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(1) the discontinuation would occur during the heating season and present an
immediate and serious hazard to the health of an occupant of the dwelling, as set forth in a
physician's certificate furnished to the propane distributor. Notice to the propane distributor
by telephone or otherwise that the certificate will be forthcoming is considered equivalent
to receipt of the certificate if the certificate is received within seven days of the notice; or
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(2) the customer has not been given an opportunity to enter into a reasonable
repayment agreement to pay the delinquent bill or, having entered into a repayment
agreement, has complied with its terms.
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(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.
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new text begin Subd. 2. new text end
new text begin Discontinuance notice form. new text end
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(a) A discontinuance notice must contain
all of the following information:
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(1) the amount that is delinquent, the date and amount of the last payment made by the
customer for propane, and the date and amount of the last propane delivery to the customer;
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(2) a statement that propane delivery will be discontinued unless the customer pays
the delinquency in full by a specified date;
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(3) if the discontinuance is to occur during the heating season, a list, annually
compiled by the Department of Commerce, of names, addresses, and telephone numbers
of governmental and private agencies that may help customers pay their propane bills; and
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(4) procedures for filing a complaint regarding the discontinuance with the Office of
the Attorney General and the Department of Commerce; and
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(5) any other information required by the commissioner.
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(b) A copy of the discontinuance notice must be delivered to the customer and, if not
the same person, the occupant of the dwelling that is the subject of the discontinuance.
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Sec. 6.
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[216B.0996] NONDISCRIMINATION.
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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 to all new and existing customers.
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Sec. 7.
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[216B.0997] TERMS OF SALE.
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new text begin Subdivision 1. new text end
new text begin Minimum delivery. new text end
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(a) During the heating season, a propane
distributor may not require a customer to purchase, per delivery, more than:
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(1) 150 gallons of propane, if the customer's propane tank has a capacity below
500 gallons; or
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(2) 300 gallons of propane, if the customer's propane tank has a capacity of 500
gallons or more.
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(b) Except 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.
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(c) The purchase limits in this subdivision shall also apply to the initial delivery of
propane following installation of a customer's propane tank.
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(d) A propane dealer may not charge an additional fee to a customer because the
customer has purchased propane in amounts allowed under this subdivision.
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new text begin Subd. 2. new text end
new text begin Cash sales. new text end
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(a) A propane distributor with an available supply of propane
must not refuse to sell propane to a customer who:
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(1) pays the lawful price upon delivery in cash, by certified or cashier's check, or by
commercial money order or its equivalent; or
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(2) receives energy assistance from LIHEAP or a governmental or private agency
that has funds available to pay for a delivery.
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(b) A propane dealer 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 company 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 Delivery charge; additional fees. new text end
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(a) A propane distributor may not
charge a customer a delivery fee, except when the customer requests a delivery to be
made outside of the propane distributor's:
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(1) normal business hours, as posted at the propane distributor's place of business or
on its Web site; or
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(2) normally scheduled deliveries to the customer's geographical area.
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(b) No propane distributor may charge an additional fee to a residential customer
for low or minimal usage.
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new text begin Subd. 4. new text end
new text begin LIHEAP participation and payments. new text end
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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, must deliver the full amount of propane and any related
cost or service paid for by LIHEAP funds, and must not require any minimum delivery fee
or security deposit from a customer receiving LIHEAP assistance.
new text end
new text begin Subd. 5. new text end
new text begin Third-party credit disclosure. new text end
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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.
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new text begin Subd. 6. new text end
new text begin Security deposits. new text end
new text begin
During the heating season, a propane distributor
may not require the customer 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.
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Sec. 8.
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[216B.0998] REGISTRATION; REPORTING.
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new text begin Subdivision 1. new text end
new text begin Registration. new text end
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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.
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new text begin Subd. 2. new text end
new text begin Reporting. new text end
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(a) Annually by September 1, a propane distributor must
submit the following information to the commissioner:
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(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;
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(2) a copy of the standard contract between the propane distributor and a customer;
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(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
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(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.
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(b) Beginning at the start of the heating season of 2014-2015, and continuing each
subsequent heating season, a propane distributor must 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
Sec. 9. new text begin APPLICABILITY; REGISTRATION AND REPORTING
REQUIREMENTS.
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The initial registration and reporting required under section 8 must be submitted
on or before September 1, 2014.
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Sec. 10. new text begin EFFECTIVE DATE.
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Sections 1 to 9 are effective the day following final enactment.
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