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Heat, recession move city to extend payment plans for utility customers
Tuesday, August 25, 2009 by John Davidson
The city announced a program Monday afternoon to help people who have fallen behind on utility payments amid record summer temperatures.
Responding to concerns that customers would get disconnected this fall because they had run up such large bills over the summer, Austin Energy officials met with about a dozen community groups last week and worked out a program to defer past-due payments over a six-month period, according to a statement issued by city officials.
“July was the hottest month on record and it appears we will break the all-time record in Austin for the total number of days over 100 degrees,” said Austin Mayor Lee Leffingwell. “The extreme heat coupled with the downturn in the economy requires additional consideration for citizens facing financial difficulties.”
The program requires customers to pay 25 percent of their total past due balance as a down payment within seven days of enrollment. The remaining balance is spread across six equal installments, due along with current monthly charges.
At the Electric Utility Commission meeting Monday evening, Kerry Overton of Austin Energy discussed the program in detail and said there are talks underway to offer the program again next summer. Several people offered public comment on the program.
“I want to thank the commission for coming up with a plan so quickly,” said Randy Chapman, Executive Director of the Texas Legal Services Center. “This time last week I didn’t think we’d have this result.”
The measures are actually an expansion of an existing deferred payment program. Previously, the city had been offering payment plans of up to four months with a down payment of 50 percent of the total past due amount.
Asked about the percentage of customers enrolled in the program that could not meet the 25 percent down payment of the total amount due, Overton said that when the program required a 50 percent down payment, about 90 percent of customers enrolled were able to make the payment. “Given than we’ve lowered that, I don’t think we’ll see a problem,” he said.
Temperatures consistently in excess of 100 degrees this summer have caused utility bills to triple since spring, with the average bill climbing from $88 in March to $235 in July, according to Austin Energy. Since the city does not disconnect utilities during the hottest months, customers who would have otherwise had to pay or be disconnected have instead racked up large amounts of debt.
“We promise no disconnections for anyone who enrolls in the program,” said Jawana Gutierrez, Austin Energy’s new Vice President of Customer Care. “And if a customer needs longer than the six months, we can negotiate an additional four-month term.” To enroll in the program, customers should contact the city before Oct. 1.
Austin Energy also offers a flat payment program, in which utility customers may pay the same every month. The utility arrives at the monthly amount by averaging out the previous year’s bills at that address and factoring in any rate increases. Customers should contact Austin Energy for details.
Electricity usage for single-family homes hit a record 2,157 kilowatt-hour average, up from an average of 887 kilowatt-hours during March and April, according to Austin Energy.
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