A utility company can require you to pay one-third of the yearly cost of service before connection if it believes there is a pattern of avoiding paying for service at the same location. This is called Payment Avoidance by Location (PAL), and it applies when:
- There is a new application for public utilities from the service location;
- A former customer who was disconnected for non-payment at the same service location still lives there; and
- The new applicant lived at the service location during the time the previous customer's debt was made.
The utility company must show evidence that a pattern of avoiding paying for service is occurring at the address.
The utility company must give written notice that describes the problem and facts in detail and shows evidence that proves there is a pattern of avoiding payment. When the utility company has proof that PAL is happening, it can request 1/3 of the estimated yearly charges for service to be paid in full before connection. The person accused of PAL has the right to see all of the utility company’s evidence and will get the chance to respond to the allegations.
Changing your bill due date to match when you get your benefit check
If your primary source of income is from a benefit, such as Social Security or Veterans benefits, that is received within 10 days after your regular due date, the utility company must offer you a preferred payment date that allows you to make timely payments. If you pay late 2 times in a 12 month period the utility company must notify you of the availability of a preferred payment date. A preferred payment date may also be an option for you if you enter into a budget payment plan. You may call the company and ask for a specific date your bill is due each month.
Eliminating utility debt by filing for bankruptcy
You can have your utility debts discharged if you file for bankruptcy. While the bankruptcy case is pending, the utility cannot shut off service based on the past due debt, as long as you listed the debt on the schedule. If you are thinking about filing for bankruptcy, you need to weigh the advantages and disadvantages beforehand.