The state should extend a moratorium on utility shutoffs until next April and launch a proceeding to determine just how much debt customers may have run up by not paying bills during the pandemic, according to New Jersey’s Division of Rate Counsel.
In a petition filed yesterday with the Board of Public Utilities, Rate Counsel director Stefanie Brand also urged the regulatory agency to suspend filings of new base-rate cases and spending on infrastructure programs by utilities during the ongoing public health crisis.
The filing reflects mounting concerns by her office and consumer advocates over the long-term impact COVID-19 has had on New Jersey where more than 16,000 people have died and over 1.56 million have filed for unemployment since the pandemic began in mid-March.
How deep in debt?
“COVID-19 continues to wreak havoc on both the health and financial wellbeing of New Jersey ratepayers,’’ Brand argued in the petition. She urged the board to consider how many customers have fallen behind on their their bills and by how much, as well as what steps can be taken to eliminate that debt.
Brand cited Gov. Phil Murphy speaking on National Public Radio last month, “Most everybody is hurting, but particularly, low-income workers and their families have been crushed. Small businesses have been crushed. The impact has been staggering across the board.’’
The governor’s office did not respond to a request for comment.
But other consumer advocates urged the governor to extend the voluntary moratorium, which is now scheduled to expire on Oct. 15.
“It is likely that hundreds of thousands of New Jersey families and businesses cannot afford their utility bills and are at risk of being shut off … these essential lifeline services are always critical for health and safety, but especially during a pandemic,’’ said Ev Liebman, associate director of AARP New Jersey. “We hope the board responds quickly.’’
Others criticized the proposal, questioning the call to suspend utility infrastructure programs, which they said were a big part of the economic recovery coming out of the Great Recession a dozen years ago.
Infrastructure jobs ‘sorely needed’
“Well, it’s certainly counterproductive to call for suspending new infrastructure programs that would create good-paying jobs at a time they are sorely needed, not to mention many of these programs would make systems more efficient, more reliable and better able to integrate renewables,’’ said Tom Churchelow, president and CEO of the New Jersey Utilities Association.
In the petition, Rate Counsel also asked for a lot of things that the utilities probably will not like, such as waiving interest on any fees or interest on late payments; waiving fees and deposits to reconnect residential and small commercial customers experiencing economic hardship; and exploring other possible programs or changes to eligibility to assist customers who are unable to pay their bills and any amount in arrears.
The utilities voluntarily agreed to extend the moratorium until Oct. 15 in August, along with a plan to offer residential and commercial customers a Deferred Payment Agreement, which allowed ratepayers at least 12 and up to 24 months to pay off their bills, without requiring a down payment.
In conclusion, Brand argued such a proceeding would help develop a plan that would protect both the interests of ratepayers and utility providers.
“There is a significant risk that if the board does not investigate and attempt to address these issues, the problems will have a snowball effect,’’ Rate Counsel argued. “The results of these multiple increased financial burdens is that more ratepayers will have difficulty paying their utility bills.’’
Under another state law, all utility customers pay a surcharge on their monthly bills that allows utilities to recoup the risk of uncollectible ratepayer bills. “Simply asking ratepayers as a whole to absorb these costs may cause even more customers to be unable to pay their bills and exacerbate the very problem that needs to be solved,” Brand said.