On May 11, 2021, NYS Governor Cuomo signed Senate Bill 1453-B, extending the time and expanding the protections of the utility moratorium established in June 2020. Last year, the state amended the Public Service Law to prevent public and private utilities from shutting off water, electricity, gas, or telephone service to residential customers who experienced a change in financial circumstances due to the COVID-19 pandemic and required them to restore those disconnected utility services. Utilities were also required to offer deferred payment plans or restructuring of any existing payments owed without requiring a down payment or late fees and penalties. These amendments to the law, however, expired on March 31, 2021.
The recently adopted law expands protection not only for water, electricity, gas, and telephone, but now includes cable TV and broadband services. The new law includes protections for not only residential customers but also nonresidential customers whose accounts serve residential premises or small businesses with 25 or fewer employees that are not a:
a) Publicly held company or a subsidiary thereof
b) Seasonal, short-term, or temporary customer
c) High-usage customer as defined by the Public Service Commission
d) Customer that the utility can demonstrate has the resources to pay the bill, provided that the small business customer is notified and has the right to contest the utility’s determination
Utilities must continue to restore any service and cannot terminate or discontinue service, or place, sell, or enforce any lien on real property while the moratorium is in effect. Once the moratorium expires, utilities are required to send a notice stating the utility’s intention to terminate service or place a lien on real property as well as a notice of a customer’s rights at least 30 days prior to acting. Significantly, the moratorium does not forgive or waive utility charges; it only allows eligible customers to defer payment or make partial payment of the charges and prohibits enforcement for nonpayment until the end of the moratorium.
Utilities are also required to provide a notice to customers of their rights in the same frequency that the customer receives a regular bill. This notice can be in writing included with a billing statement or, when appropriate, via electronic transmission. Residential customers, nonresidential customers whose accounts serve residential premises, and small business service customers continue to be afforded the opportunity to enter into or restructure a deferred payment agreement.
The moratorium is effective immediately and remains in effect for a period of 180 days after either the COVID-19 State of Emergency is lifted or expires or December 31, 2021, whichever is earlier.
If you have any questions regarding the content of this alert, please contact Charlie Martorana, partner, at cmartorana@barclaydamon.com; Samantha Podlas, associate, at spodlas@barclaydamon.com; or another member of the firm’s Corporate Practice Area.
We also have a specific team of Barclay Damon attorneys who are actively working on assessing regulatory, legislative, and other governmental updates related to COVID-19 and who are prepared to assist clients. Please contact Yvonne Hennessey, COVID-19 Response Team leader, at yhennessey@barclaydamon.com or any member of the COVID-19 Response Team at COVID-19ResponseTeam@barclaydamon.com.