SF 2164

2nd Engrossment - 88th Legislature (2013 - 2014) Posted on 03/21/2014 08:30am

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;
proposing coding for new law in Minnesota Statutes, chapter 325E.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [325E.0271] 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 325E.0271 to 325E.0276, 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 has an established relationship
with a propane distributor and whose propane system meets the safety guidelines
established by the propane distributor for residential heating service.
new text end

new text begin Subd. 3. 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. 4. new text end

new text begin Propane distributor. new text end

new text begin "Propane distributor" means a person who sells
propane at retail to customers as their primary residential heat source; propane distributors
are not public utilities.
new text end

new text begin Subd. 5. 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.

new text begin [325E.0272] PRICE AND FEE DISCLOSURE.
new text end

new text begin 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:
new text end

new text begin (1) made available to the general public upon request; and
new text end

new text begin (2) provided to new customers before residential heating service is initiated.
new text end

Sec. 3.

new text begin [325E.0273] BUDGET PAYMENT PLAN.
new text end

new text begin (a) A propane distributor who offers customers a budget payment plan must make that
plan available to all customers, including those who participate in the LIHEAP program.
new text end

new text begin (b) A budget payment plan must equalize a customer's estimated annual propane bill
by dividing it into equal monthly payments. Any budget plan started after the propane
distributor's traditional budget plan start date will be divided by the remaining months
in the budget plan year. 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 next year.
new text end

new text begin (c) A propane distributor must notify a customer on a budget payment plan 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

new text begin (d) A propane distributor may alter or terminate the plan if a customer has failed to
pay two monthly payments during the period of the budget payment plan. In lieu of the
requirements of this section, the parties may enter into a mutually agreeable plan.
new text end

Sec. 4.

new text begin [325E.0274] PROPANE PURCHASE CONTRACTS.
new text end

new text begin A propane distributor is prohibited from adding any service, distribution,
transportation, or similar fees to customer billings for those customers who have entered
into a contract for prepurchasing or capitated pricing of propane for the period of the
contract provided that:
new text end

new text begin (1) the customer has met all obligations of that contract; and
new text end

new text begin (2) the propane distributor can receive product from its contracted supply points and
a force majeure has not been declared by the propane distributor's supplier.
new text end

Sec. 5.

new text begin [325E.0275] NONDISCRIMINATION.
new text end

new text begin A propane distributor that offers customers service 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.
new text end

Sec. 6.

new text begin [325E.0276] TERMS OF SALE.
new text end

new text begin Subdivision 1. new text end

new text begin Cash sales. new text end

new text begin 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 distributor's established 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 Subd. 2. new text end

new text begin LIHEAP participation and payments new text end

new text begin A propane distributor who accepts
LIHEAP payments must, upon request, make available to its customers information
regarding LIHEAP, including income eligibility and contact information for organizations
accepting LIHEAP applications.
new text end

new text begin Subd. 3. 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. 4. 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 $200.
new text end

Sec. 7. new text begin SHORT-TERM LOAN PROGRAM.
new text end

new text begin Prior to the commencement of the 2015 legislative session, the commissioner of
commerce must submit to the legislature proposed legislation creating a short-term loan
program for persons in need of propane between October 15 and April 15 of any year and
who are financially unable to purchase it. The program must:
new text end

new text begin (1) be state funded;
new text end

new text begin (2) require repayment within a short period of time; and
new text end

new text begin (3) be capable of rapidly making payments to propane distributors in consideration
of the loan recipient's circumstances, and be subject to audit and verification.
new text end

Sec. 8. new text begin FRONT-LOAD LIHEAP PROGRAM FOR DELIVERED FUELS.
new text end

new text begin The Minnesota Energy Assistance Program shall annually borrow from the general
fund 75 percent of the traditional funds expended on delivered fuels to front load the
LIHEAP program for those delivered fuels allowing for purchase and delivery of product
in the summer and early fall when it is more cost-effective for the state, LIHEAP
participants, and propane distributors. The following conditions shall apply:
new text end

new text begin (1) the delivered fuels program would begin August 1 of each year;
new text end

new text begin (2) funds needed to operate the early program must be borrowed from the general
fund and paid back upon the state's receipt of funds from the federal government; and
new text end

new text begin (3) at the department's discretion, it may either (i) take applications and fund
individual LIHEAP clients; or (ii) prebuy fuel from participating LIHEAP delivered
fuels distributors.
new text end