Subchapter C. CREDIT AND DEPOSIT STANDARDS POLICY

 An essential ingredient of the credit and deposit policies of each LEC shall be the equitable and nondiscriminatory application of those precepts to potential and actual customers throughout the service area or a part thereof. Deposit policies shall be based on the credit risk of the applicant or customer rather than upon the credit history of the affected premises or upon the collective credit reputation or experience in the area in which the applicant or customer lives without regard to race, religion, gender, age if over 18, national origin or marital status.

   The provisions of this §  64.31 amended under the Public Utility Code, 66 Pa.C.S. § §  501, 504—506, 1301 and 1501.

 A LEC shall provide residential service without requiring a deposit when the applicant satisfies one of the following requirements:

   (1)  Earlier LEC payment history. The applicant had service with a LEC within a period of 24 consecutive months before the date of application and the following conditions exist:

     (i)   Service was furnished in the name of the applicant, and there is no unreturned equipment.

     (ii)   Service was not suspended for nonpayment nor terminated during the last 12 months of service.

     (iii)   The applicant does not have an unpaid balance from earlier service.

     (iv)   The applicant was not required to pay a security deposit under §  64.35 (relating to deposit requirements for existing customers) for the earlier service.

   (2)  Ownership of real property. The applicant verifies the ownership of or the entry into an agreement to purchase real property located in the area served by the LEC or is renting a residence under a lease of 1 year or longer, unless the applicant has an otherwise unsatisfactory payment history as a LEC customer within 2 years before the application for service as described in paragraph (1).

   (3)  Prior utility payment history. The applicant has prior satisfactory credit history for use of utility service under §  56.32 (relating to credit standards). In all instances, the utility shall obtain from the applicant authorization as a condition for completing the utility credit search. If the applicant elects not to authorize completion of the credit search, the utility shall conduct a credit search in the manner prescribed under paragraph (4).

   (4)  Credit information. The applicant provides information and verification demonstrating that he is not an unsatisfactory credit risk.

     (i)   The absence of prior credit history does not, of itself, indicate an unsatisfactory credit risk and does not constitute grounds for requiring a deposit.

     (ii)   The LEC may request and consider information including the following:

       (A)   The applicant’s social security number.

       (B)   The name of the employer of the applicant.

       (C)   The place and length of employment.

       (D)   Residence during the previous 5 years.

       (E)   Letters of reference.

       (F)   Credit cards.

       (G)   A significant source of income other than from employment.

     (iii)   If a credit investigation is expected to take longer than 3 business days the LEC shall provide service pending completion of the investigation.

   The provisions of this §  64.32 amended under the Public Utility Code, 66 Pa.C.S. § §  501, 1301—1325 and 1501—1511.

   The provisions of this §  64.32 adopted November 30, 1984, effective January 1, 1985, 14 Pa.B. 4354; amended July 14, 1989, effective July 15, 1989, 19 Pa.B. 3042; amended July 21, 1995, effective July 22, 1995, 25 Pa.B. 2887. Immediately preceding text appears at serial pages (140293) to (140294).

 (a)  The LEC may require, as a condition for furnishing residential service to an applicant, the payment of an outstanding residential account with the LEC which accrued within the past 4 years, for which the applicant is legally responsible and for which the applicant was billed properly. However, the outstanding residential account with the LEC may be spread out over a reasonable period of time. Factors to be taken into account shall include, but not be limited to, the size of the unpaid balance, the payment history of the customer, and the length of time over which the bill accumulated.

 (b)  A LEC may not require, as a condition for the furnishing of residential service, payment for residential service previously furnished under an account in the name of persons other than the applicant unless a court, district justice or administrative agency has determined that the applicant is legally obligated to pay for the service previously furnished.

 (c)  This section may not affect the creditor’s rights and remedies of the LEC otherwise permitted by law.

 Each LEC shall establish written procedures for dtermining the credit status of an applicant. Each LEC employe processing applications or determining the credit status of an applicant shall be familiar with and have ready access to a copy of the written procedures of the LEC. A copy of the procedures shall be maintained on file in each business office of the LEC and be made available, upon request, for inspection by the public and the Commission.

   (1)  Informing applicants of procedures. The LEC personnel shall provide an explanation of applicable credit and deposit procedures to each customer or applicant for service.

   (2)  Reasons for deposit request. If a deposit or payment of an outstanding residential account is required before furnishing service, the LEC shall inform the applicant in writing of the reasons for denial of credit and how to obtain service. Existing customers will be informed of the reasons for denial of credit before suspension of service.

   The provisions of this §  64.34 amended under the Public Utility Code, 66 Pa.C.S. § §  501, 504—506, 1301, 1501.

 Deposits may be required to secure the account of an existing customer if any of the following conditions exist:

   (1)  Delinquent account. A customer has made payment of two consecutive bills, or of more than two bills within the proceding 12 months, after the payment due date. Before requesting a deposit under this paragraph, the LEC shall give the customer written notification of its intent to request a deposit if current and future bills continue to be paid after the due date.

     (i)   Notification shall clearly indicate that a deposit is not required at this time but that, if bills continue to be paid after the due date, a deposit will be required.

     (ii)   Notification may be mailed or delivered to the customer together with a bill for telephone service.

     (iii)   Notification shall set forth the address and telephone number of the LEC office where complaints or questions may be registered.

     (iv)   The subsequent request for deposit shall clearly indicate that a customer should register a question or complaint about that matter prior to the date the deposit is due in order to avoid having service suspended pending resolution of a dispute. The request shall include the telephone number of the LEC office where questions or complaints may be registered.

   (2)  Condition to the reconnection of service. A LEC may require a deposit as a condition for reconnection of service after suspension or termination of service for nonpayment.

   (3)  Failure to comply with payment agreement. A LEC may require a deposit when a customer fails to comply with the terms and conditions of a payment agreement, whether or not service has been suspended or terminated.

   The provisions of this §  64.35 adopted November 30, 1984, effective January 1, 1985, 14 Pa.B. 4354; amended July 21, 1995, effective July 22, 1995, 25 Pa.B. 2887. Immediately preceding text appears at serial pages (140295) to (140296).

 An LEC’s request for deposit may be satisfied by one of the following:

   (1)  Posting a cash deposit. The following conditions apply:

     (i)   Applicants. The amount of cash deposit required from an applicant may not exceed the estimated average 2-month bill for basic service plus the average 2-month toll charges for existing residential customers in the applicant’s exchange during the immediately preceding 12-month period. Deposits may be adjusted to maintain a level equal to the estimated average 2-month bill. No more than one half of the deposit amount may be required prior to the providing of service by the utility with the balance of the deposit due no less than 30 days from the initial deposit payment.

     (ii)   Existing customers. The amount of a cash deposit required from an existing customer may not exceed the customer’s average 2-month bill, including toll charges, during the preceding 12-month period. Deposits may be adjusted to maintain a level equal to the average 2-month bill. The deposit shall be paid within 20 days of the request for deposit.

   (2)  Furnishing a written third-party guarantee. Another customer who has met or can meet the credit standards of §  64.32 (relating to credit standards) may furnish a written guarantee to secure payment in an amount equal to the cash deposit required from the applicant or customer. The guarantor shall be discharged when the applicant or customer meets the terms and conditions of §  64.37 (relating to refund of deposits)

   The provisions of this §  64.36 amended under the Public Utility Code, 66 Pa.C.S. § §  501, 1301—1325 and 1501—1511.

 An LEC shall refund the cash deposit, plus accrued interest, under the following conditions.

   (1)  Termination or permanent discontinuance of service. Upon termination or discontinuance of service, the LEC shall apply the deposit of a customer, including accrued interest, to the outstanding balance and refund the remainder to the customer. A transfer of service from one location to another within the service area may not be deemed a discontinuance within the meaning of this paragraph.

   (2)  Credit established. At the customer’s request, when a customer establishes credit under §  64.32 (relating to credit standards), the LEC shall refund the cash deposit plus accrued interest.

   (3)  Prompt payment of bills. After a customer has paid bills for service for 12 consecutive months without having service suspended or terminated and without having paid bills subsequent to the due date on more than two occasions, the LEC shall refund the cash deposit, plus accrued interest, so long as the customer is not currently delinquent.

   (4)  Optional refund. At the option of the LEC, a cash deposit, including accrued interest, may be refunded, in whole or in part, at any time before the expiration of the time period stated in paragraph (3).

   The provisions of this §  64.37 adopted November 30, 1984, effective January 1, 1985, 14 Pa.B. 4354; amended July 21, 1995, effective July 22, 1995, 25 Pa.B. 2887. Immediately preceding text appears at serial pages (140297) to (140298).

 The customer may elect to have a deposit applied to reduce bills for telephone service instead of a cash refund.

   The provisions of this §  64.38 adopted November 30, 1984, effective January 1, 1985, 14 Pa.B. 4354.

 If a customer is not entitled to a refund under §  64.37 (relating to refund of deposits), the LEC shall review the account of the customer each succeeding quarter and shall make appropriate disposition of the deposit in accordance with §  64.37 and §  64.38 (relating to application of deposit to bills).

 When a cash deposit is refunded, the LEC shall either mail or deliver to the customer a written statement showing the amount of the original deposit plus all accrued interest, the application of the deposit to a bill which had previously accrued, the amount of unpaid bills liquidated by the deposit, and the remaining balance.

 Interest calculated under section 202 of the act of January 30, 1974 (P. L. 13, No. 6) (41 P. S. §  202), known to as the Loan Interest and Protection Law, shall be payable on deposits without deductions for taxes thereon. Interest shall be paid annually to the customer or, at the option of either the LEC or the customer, shall be applied to the customer’s bill.

   The provisions of this §  64.41 amended under the Public Utility Code, 66 Pa.C.S. § §  501, 1301—1325 and 1501—1511.

   The provisions of this §  64.41 adopted November 30, 1984, effective January 1, 1985, 14 Pa.B. 4354; amended July 14, 1989, effective July 15, 1989, 19 Pa.B. 3042; amended July 21, 1995, effective July 22, 1995, 25 Pa.B. 2887; amended December 15, 2006, effective December 16, 2006, 36 Pa.B. 7558. Immediately preceding text appears at serial page (246502).