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Issue Alert - 02-09-04

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Date:

Oct 01, 2002

Issue Summary:

“Positive Billing” for cash recipients no longer exists. Vendoring will continue through a different program that does not provide shutoff protection.

Persons Affected:

FIP, SDA, RAP, or REP recipients who use Positive Billing to pay their heat and electric bills.


Background

Family Independence Program (FIP), State Disability Assistance (SDA), Refugee Assistance Program (RAP) and Repatriate Program

What's Happening?

Heat and Electric Positive Billing will end 10/01/02. Recipients who were enrolled in Positive Billing will be automatically converted to a new system called “Consolidated Vendor Warrant” (CVW) vendoring. CVW vendoring does not provide shutoff protection during the winter heating season. If the household owes an arrearage to the utility company, they will have to make other arrangements to pay off the arrearage in order to avoid a shutoff. Clients are now receiving letters from FIA telling them about this change. Regulated utilities such as Consumers Energy, Detroit Edison, and MichCon offer Winter Protection Plans that can help eligible households avoid shutoffs during the winter heating season (December 1 - March 30). Households must enroll between November 15th and March 30th . Eligible households include households receiving SSI, Medicaid, or Food Stamps (Food Assistance Plan), households with income under 150% of poverty, and senior citizens age 65 or older. Payments under the Winter Protection Plan are based on a mathematical formula and may lead to high required payments in the spring. See Michigan Administrative Code Rule 460.2174. Regulated utility companies also must offer reasonable settlement agreements, which are not based on a mathematical formula and may be negotiated to meet the individual needs of the household. If clients have made their required payments, they can also seek SER help with shut offs as needed. Households who default on the winter protection plan are not, however, entitled to receive a settlement agreement. Households that do not have an arrearage or have only a small arrearages that they can pay off may be able to enroll in a payment plan that allows them to pay the same amount each month all year round, to avoid having unaffordable payments during the winter heat season.

What Should Advocates Do?

Advocates should make sure their clients who use vendoring through FIA know that they will not have shutoff protection effective 10/01/02. FIA will continue to vendor required payment amounts and a portion of arrearages for unmet required payments, but individuals will be responsible for paying the remainder of their bills to avoid utility shutoffs. Advocates should become familiar with the energy assistance programs offered by local utility providers and human services agencies that may help clients get caught up on their utility bills. Legal advocates should become familiar with the Public Service Commission Residential Billing Rules governing residential gas and electric providers. MAC Rule 460.2101 et seq. Advocates should advise their clients to: - contact their energy companies directly if they need to negotiate a payment plan for an arrearage due between October 1st and December 1st (when the Winter Protection Plan begins), or if they need to negotiate a more flexible payment plan- enroll in Winter Protection Plans directly through their utility companies in November unless the resulting payments are likely to be too high. Note that if a client enrolls in the WPP, the client will not be eligible for a settlement agreement with consumers if there is a problem with the bill in the future- advise clients about special short term shut-off protection available to persons who can prove they have critical medical needs or for senior citizens. See Michigan Administrative Code Rule 460.2153.- apply for the Home Heating Credit through the State of Michigan- contact their local Community Action Agency to find out if they can receive weatherization services that may reduce their utility bills- conserve their daily energy use- apply for State Emergency Relief (SER) if they have received a shutoff notice- seek legal help if they need assistance negotiating a payment plan, believe they have been wrongfully denied SER, or have dispute with the utility company about the amount that the company says they owe

What Should Clients Do?

Clients should enroll in Winter Protection Plans directly through their utility companies to prevent heat and electric shutoffs during the winter months. If clients need help before the winter, or need a more flexible payment plan, they should contact their utility company to negotiate a payment plan. Clients should also apply for the Home Heating Credit through the state of Michigan. Community Action Agencies provide weatherization services that may help reduce energy bills. If clients receive shutoff notices they should apply for State Emergency Relief through FIA.FIA has a toll-free energy hotline that clients and/or advocates may call for more information: 1-800-292-5650. Hours: 8:00 – 11:45am and 1:00 – 4:15pm.Consumers who have payment disputes or other problems with their utility companies can file a complaint with the Public Service Commission by calling toll-free 1-800-292-9555.

Finding Help

Most legal aid and legal services office handle these type of cases, and they do not charge a fee. You can locate the "free" legal services or legal aid office that serves your county on the Michigan Legal Assistance Network website (http://www.mlan.net/locate.html) or look in the yellow pages under "attorneys" or call the toll-free lawyer referral number, (800) 968-0738