Federal money might go to help thousands behind on utility bills

Murphy allows for ‘grace period’ to prevent shut-offs until end of the year as state works to find money for back payments
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For the first time, Gov. Phil Murphy publicly suggested federal funds might be tapped to offset the more than half-billion dollars in unpaid utility bills run up by customers during the coronavirus pandemic.

Murphy’s announcement came Monday at a routine briefing on the health emergency where he said he would sign an executive order ending a moratorium on utility shut-offs as of July 1. But Murphy said he would create a grace period until the end of the year to protect customers from losing services because of utility arrearages.

Utility assistance is an eligible use of the billions of dollars of federal funding under the American Rescue Plan, approved by Congress and signed by President Biden earlier this year, Murphy noted. “During this grace period we will continue to evaluate how best to deploy these funds to help New Jersey families,’’ he said.

More than 350,000 households in arrears

Various state departments have been working on ways to expand assistance programs to help customers pay their overdue bills. But they have failed to reach a consensus, largely because of the magnitude of the problem. As of May, more than 350,000 households were in arrears on their utility bills, about half with bills more than five months overdue.

Utility officials and consumer advocates are pressing to tap the federal dollars allocated to New Jersey but so far without any commitment from either the Legislature or the governor’s office to do so. Murphy’s announcement could signal that ongoing discussions with lawmakers on the state budget due before July 1 may result in an agreement on diverting American Rescue Plan funds to new utility assistance programs.

In creating the grace period, Murphy said the policy is consistent with legislation he signed earlier this month allowing the termination of the public health emergency. That law allowed several executive orders, including the one instituting the utility shut-off moratorium, to remain in effect until Jan. 1 “in recognition of the fact that hundreds of thousands of New Jerseyans are facing utility arrearages and need some time to get back on their feet.’’

Murphy noted that the conclusion of the grace period will fall during the annual winter moratorium on gas and electric shut-offs for certain households — including some seniors and low-income families — so these families will be protected through the middle of March 2022.

Murphy noted no one will face disconnection of their gas, electric or water services before the end of the grace period but said the latter is designed for customers to enlist in payment assistance plans. “And this is something we are taking very seriously,’’ he said.

Tom Churchelow, president of the New Jersey Utilities Association, welcomed Murphy’s willingness to allocate federal funds for helping customers pay down arrearages. “We strongly urge the Governor and his administration to develop a way to directly leverage some of the more than $6 billion toward helping pay down arrearages,’’ Churchelow said.

READ: Ban on utility shut-offs is extended by state

WATCH: Governor ends public health emergency

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