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Public Notices

April 24, 2014

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GL&PS Board Considers Security Deposit Options

Originally published: 2012-12-20 10:47:37
Last modified: 2012-12-20 10:50:30
 


BY LAUREN HENRY

STAFF WRITER

The Greeneville Light & Power System's Board of Directors held a workshop Wednesday afternoon to discuss how to deal with the problem of commercial and industrial customers who don't pay their utility bills.

General Manager Bill Carroll said that the utility has not had a problem with residential customers' failing to pay their electricity bills.

The problem, he told the board, lies with the system's larger commercial and industrial accounts. If they do not pay for the electricity they use, the rest of the utility's customers must absorb that expense, Carroll explained.

He wanted the board to discuss solutions to protect the rest of the GL&PS customers from those few customers who do not pay.

"At the end of every day it's our responsibility to develop, propose, and explain reasonable security requirements to protect those who pay their utility bills from those who do not," Carroll said.

OUTDATED POLICIES?

Electricity is a service consumed prior to payment. A customer receives about 59 days of electricity before payment must be received by the GL&PS.

"We have security deposit policies that were written almost 20 years ago, and, frankly, they really don't function well any more," he said.

Carroll suggested accumulating a cash deposit from flagged customers over a number of months.

He said the GL&PS would use the automatic credit rating system in an effort to identify customers who are beginning to have problems before payments to the power system stop entirely.

He also discussed the option of prepay, describing it as similar to prepaying for gasoline at the gas station.

CONCERN ABOUT BILLING CYCLE

Board member Sam Miller said his biggest concern is the length of the bill cycle, which is 60 days. He said he would like to see a shorter cycle.

However, Carroll explained that law requires the customer to have the bill for 15 days before payment is required.

He said he could not foresee any way to shorten the payment cycle other than having weekly payments, which would result in about a 30-day cycle.

Miller also requested more financial information about customers to better forecast those that are in danger of skipping payments.

POLICY ON NEW CUSTOMERS

The board discussed ways to balance customer service with providing security for payments.

Carroll said GL&PS wants to assume the best of customers from a customer service standpoint, but wants to assume the worst if a problem is detected.

Those who are already customers would not receive a change in payment policy unless GL&PS detects a potential issue.

The board was unsure about the policy concerning new customers.

The question was whether to require deposits for all new customers, or assume the best when a new customer signs up and only require security deposits or a prepayment plan if problems were uncovered later.

Board member Shane Hite said he is unsure what the best option for new customers is.

Director of Customer Service Jim Glaze said that customers have said that, if they know about the deposit requirement in the beginning, it would not be as big an issue.

The board agreed that a policy needs to be adopted so customers are fully aware of what the financial expectations are.

The issue will be discussed further at a later GL&PS Board of Directors meeting.

 
For more information and stories, see The Greeneville Sun.

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