By Danburg H.B. No. 1730
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the protection of telecommunications and electric
1-3 services customers; providing penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 11.002, Utilities Code, is amended by
1-6 adding Subsection (c) to read as follows:
1-7 (c) Significant changes have occurred in the
1-8 telecommunications and electric power industries since the Public
1-9 Utility Regulatory Act was originally adopted. Changes in
1-10 technology and market structure have increased the need for minimum
1-11 standards of service quality, customer service, and fair business
1-12 practices to ensure high-quality service to customers and a healthy
1-13 marketplace where competition is permitted by law. It is the
1-14 purpose of this title to grant the Public Utility Commission of
1-15 Texas authority to make and enforce rules necessary to protect
1-16 customers of telecommunications and electric services consistent
1-17 with the public interest.
1-18 SECTION 2. Section 15.024, Utilities Code, is amended to
1-19 read as follows:
1-20 Sec. 15.024. ADMINISTRATIVE PENALTY ASSESSMENT PROCEDURE.
1-21 (a) If the executive director determines that a violation has
2-1 occurred, the executive director may issue to the commission a
2-2 report that states the facts on which the determination is based
2-3 and the executive director's recommendation on the imposition of an
2-4 administrative penalty, including a recommendation on the amount of
2-5 the penalty.
2-6 (b) Not later than the 14th day after the date the report is
2-7 issued, the executive director shall give written notice of the
2-8 report to the person against whom the penalty may be assessed. The
2-9 notice may be given by certified mail. The notice must:
2-10 (1) include a brief summary of the alleged violation;
2-11 (2) state the amount of the recommended penalty; and
2-12 (3) inform the person that the person has a right to a
2-13 hearing on the occurrence of the violation, the amount of the
2-14 penalty, or both the occurrence of the violation and the amount of
2-15 the penalty.
2-16 (c) [A penalty may not be assessed under this section if the
2-17 person against whom the penalty may be assessed remedies the
2-18 violation before the 31st day after the date the person receives
2-19 the notice under Subsection (b). A person who claims to have
2-20 remedied an alleged violation has the burden of proving to the
2-21 commission that the alleged violation was remedied and was
2-22 accidental or inadvertent.]
2-23 [(d)] Not later than the 20th day after the date the person
2-24 receives the notice, the person may accept the determination and
2-25 recommended penalty of the executive director in writing or may
3-1 make a written request for a hearing on the occurrence of the
3-2 violation, the amount of the penalty, or both the occurrence of the
3-3 violation and the amount of the penalty.
3-4 (d) [(e)] If the person accepts the executive director's
3-5 determination and recommended penalty, the commission by order
3-6 shall approve the determination and impose the recommended penalty.
3-7 (e) [(f)] If the person requests a hearing or fails to
3-8 timely respond to the notice, the executive director shall set a
3-9 hearing and give notice of the hearing to the person. The hearing
3-10 shall be held by an administrative law judge of the State Office of
3-11 Administrative Hearings. The administrative law judge shall make
3-12 findings of fact and conclusions of law and promptly issue to the
3-13 commission a proposal for a decision about the occurrence of the
3-14 violation and the amount of a proposed penalty. Based on the
3-15 findings of fact, conclusions of law, and proposal for a decision,
3-16 the commission by order may find that a violation has occurred and
3-17 impose a penalty or may find that no violation occurred.
3-18 (f) [(g)] The notice of the commission's order shall be
3-19 given to the person as provided by Chapter 2001, Government Code,
3-20 and must include a statement of the right of the person to judicial
3-21 review of the order.
3-22 SECTION 3. Subtitle A, Title 2, Utilities Code, is amended
3-23 by adding Chapter 17 to read as follows:
3-24 CHAPTER 17. CUSTOMER PROTECTION
3-25 SUBCHAPTER A. GENERAL PROVISIONS
4-1 Sec. 17.001. CUSTOMER PROTECTION POLICY. (a) The
4-2 legislature finds that new developments in telecommunications
4-3 services and the production and delivery of electricity, as well as
4-4 changes in market structure, marketing techniques, and technology,
4-5 make it essential that customers have safeguards against
4-6 fraudulent, misleading, or deceptive business practices and against
4-7 businesses that do not have the technical and financial resources
4-8 to provide adequate service.
4-9 (b) The purpose of this chapter is to establish customer
4-10 protection standards and confer on the commission authority to
4-11 adopt and enforce rules to protect customers from unfair,
4-12 deceptive, or anticompetitive practices.
4-13 (c) Nothing in this section shall be construed to abridge
4-14 customer rights set forth in commission rules in effect at the time
4-15 of the enactment of this chapter.
4-16 (d) This chapter does not limit in any way the
4-17 constitutional, statutory and common law authority of the Office of
4-18 the Attorney General of Texas.
4-19 Sec. 17.002. DEFINITIONS. In this chapter:
4-20 (1) "Billing agent" means any entity that submits
4-21 charges to the billing utility on behalf of itself or any provider
4-22 of a product or service.
4-23 (2) "Billing utility" means any telecommunications
4-24 service provider or electric utility that issues a bill directly to
4-25 a customer for any telecommunications or electric product or
5-1 service.
5-2 (3) "Certificated telecommunications utility" means a
5-3 telecommunications utility that has been granted either a
5-4 certificate of convenience and necessity, a certificate of
5-5 operating authority, or a service provider certificate of operating
5-6 authority.
5-7 (4) "Customer" means any person in whose name
5-8 telephone or electric service is billed, including individuals,
5-9 governmental units at all levels of government, corporate entities,
5-10 and any other entity with legal capacity to be billed for telephone
5-11 or electric service.
5-12 (5) "Electric Utility" has the meaning assigned by
5-13 Section 31.002.
5-14 (6) "Service provider" means any entity that offers a
5-15 product or service to a customer and that directly or indirectly
5-16 charges to or collects from a customer's bill an amount for the
5-17 product or service on a customer's local or long distance telephone
5-18 or electric utility bill.
5-19 (7) "Telecommunications utility" has the meaning
5-20 assigned by Section 51.002.
5-21 Sec. 17.003. CUSTOMER AWARENESS. (a) The commission shall
5-22 promote public awareness of changes in the electric and
5-23 telecommunications markets, provide customers with information
5-24 necessary to make informed choices about available options, and
5-25 ensure that customers have an adequate understanding of their
6-1 rights.
6-2 (b) The commission shall compile a report on customer
6-3 service at least once each year showing such comparative customer
6-4 information from reports given to the commission as it deems
6-5 necessary.
6-6 (c) The commission shall make and enforce rules to require a
6-7 certificated telecommunications utility or an electric utility to
6-8 give clear, uniform, and understandable information to customers
6-9 about rates, terms, services, customer rights, and other necessary
6-10 information as determined by the commission.
6-11 (d) Customer awareness efforts shall be conducted in English
6-12 and Spanish and any other language as necessary.
6-13 Sec. 17.004. CUSTOMER PROTECTION STANDARDS. (a) All buyers
6-14 of telecommunications and electric services are entitled to:
6-15 (1) protection from fraudulent, unfair, misleading,
6-16 deceptive, or anticompetitive practices, including protection from
6-17 being billed for services that were not authorized or provided;
6-18 (2) choice of a telecommunications service provider or
6-19 an electric utility, where such choice is permitted by law, and to
6-20 have that choice honored;
6-21 (3) information in English and Spanish and any other
6-22 language as the commission deems necessary concerning rates, key
6-23 terms and conditions, and the basis for any claim of environmental
6-24 benefits of certain production facilities;
6-25 (4) protection from discrimination on the basis of
7-1 race, color, sex, nationality, religion, or marital status;
7-2 (5) impartial and prompt resolution of disputes with a
7-3 certificated telecommunications utility or an electric utility and
7-4 disputes with a telecommunications service provider related to
7-5 unauthorized charges and switching of service;
7-6 (6) privacy of customer consumption and credit
7-7 information;
7-8 (7) accuracy of metering and billing;
7-9 (8) bills presented in a clear, readable format and
7-10 easy-to-understand language;
7-11 (9) information in English and Spanish and any other
7-12 language as the commission deems necessary concerning low-income
7-13 assistance programs and deferred payment plans; and
7-14 (10) other information or protections necessary to
7-15 ensure high-quality service to customers.
7-16 (b) The commission shall adopt and enforce such rules as may
7-17 be necessary or appropriate to carry out this section, including
7-18 but not limited to rules for minimum service standards for a
7-19 certificated telecommunications utility or an electric utility
7-20 relating to customer deposits and the extension of credit,
7-21 switching fees, levelized billing programs, and termination of
7-22 service. The commission may waive language requirements for a good
7-23 cause.
7-24 (c) The commission shall request the comments of the Office
7-25 of the Attorney General in developing the rules that may be
8-1 necessary or appropriate to carry out this section.
8-2 (d) The commission shall coordinate its enforcement efforts
8-3 regarding the prosecution of fraudulent, misleading and deceptive
8-4 business practices with the Office of the Attorney General in order
8-5 to ensure consistent treatment of specified alleged violations.
8-6 (e) Nothing in this section shall be construed to abridge
8-7 customer rights set forth in commission rules in effect at the time
8-8 of the enactment of this chapter.
8-9 Sec. 17.005. PROTECTIONS FOR CUSTOMERS OF MUNICIPALLY OWNED
8-10 UTILITIES. A municipally owned utility shall not be deemed to be a
8-11 "service provider" for purposes of Section 17.156(b) and 17.156(e).
8-12 The governing body of a municipally owned utility shall adopt,
8-13 implement and enforce rules which shall have the effect of
8-14 accomplishing the objectives set out in Section 17.004(a) and (b)
8-15 and Section 17.102. The governing body of a municipally owned
8-16 utility or its designate shall perform the dispute resolution
8-17 function provided for by Section 17.157 for customers served within
8-18 its certified service area.
8-19 SUBCHAPTER B. CERTIFICATION, REGISTRATION,
8-20 AND REPORTING REQUIREMENTS
8-21 Sec. 17.051. ADOPTION OF RULES. (a) The commission shall
8-22 adopt rules relating to certification, registration, and reporting
8-23 requirements for a certificated telecommunications utility or an
8-24 electric utility, as well as all telecommunications utilities that
8-25 are not dominant carriers, pay telephone providers, qualifying
9-1 facilities, exempt wholesale generators, and power marketers.
9-2 (b) The rules adopted under Subsection (a) shall be
9-3 consistent with and no less effective than federal law and shall
9-4 not require the disclosure of highly-sensitive competitive or trade
9-5 secret information.
9-6 Sec. 17.052. SCOPE OF RULES. The commission shall have
9-7 authority to make and enforce rules to:
9-8 (1) require certification or registration with the
9-9 commission as a condition of doing business in this state;
9-10 (2) amend certificates or registrations to reflect
9-11 changed ownership and control.
9-12 (3) establish rules for customer service and
9-13 protection;
9-14 (4) suspend or revoke certificates or registrations
9-15 for repeated violations of this chapter or commission rules; and
9-16 (5) order disconnection of a pay telephone service
9-17 provider's pay telephones or revocation of certification or
9-18 registration for repeated violations of this chapter or commission
9-19 rules.
9-20 Sec. 17.053. REPORTS. The commission may require a
9-21 telecommunications service provider or an electric utility to
9-22 submit reports to the commission concerning any matter over which
9-23 it has authority under this chapter.
9-24 SUBCHAPTER C. CUSTOMER'S RIGHT TO CHOICE
9-25 Sec. 17.101. POLICY. It is the policy of this state that
10-1 all customers are protected from the unauthorized switching of a
10-2 telecommunications service provider or an electric utility selected
10-3 by the customer to provide service.
10-4 Sec. 17.102. RULES RELATING TO CHOICE. The commission shall
10-5 adopt and enforce rules that:
10-6 (1) ensure that customers are protected from deceptive
10-7 practices employed in obtaining authorizations of service and in
10-8 the verification of provider-initiated change orders, including but
10-9 not limited to negative option marketing, sweepstakes, and contests
10-10 that cause customers to unknowingly change their telecommunications
10-11 service provider or electric utility;
10-12 (2) provide for clear, easily understandable
10-13 identification on the first page of each non-electric bill sent to
10-14 a customer of all telecommunications service providers or electric
10-15 utilities submitting charges on the bill;
10-16 (3) ensure that every service provider submitting
10-17 charges on the bill is clearly and easily identified on the bill
10-18 along with its services, products, and charges;
10-19 (4) require a telecommunications service provider or
10-20 an electric utility to maintain records of nonpublic
10-21 customer-specific information that may be used to establish that
10-22 the customer authorized a change in service for 24 months;
10-23 (5) provide that unauthorized changes in service be
10-24 remedied at no cost to the customer within a period established by
10-25 the commission;
11-1 (6) require refunds or credit with interest to the
11-2 customer in the event of an unauthorized change; and
11-3 (7) provide for penalties for violations of commission
11-4 rules adopted under this section, including but not limited to
11-5 fines and revocation of certificates or registrations, thereby
11-6 denying the certificated telecommunications utility or the electric
11-7 utility the right to provide service in this state.
11-8 SUBCHAPTER D. PROTECTION AGAINST UNAUTHORIZED CHARGES
11-9 Sec. 17.151. REQUIREMENTS FOR SUBMITTING CHARGES. (a) A
11-10 service provider or billing agent may submit charges for a product
11-11 or service to be billed on a customer's telephone or electric bill
11-12 only if:
11-13 (1) the service provider offering the product or
11-14 service has thoroughly informed the customer of the product or
11-15 service being offered, including all associated charges, and has
11-16 explicitly informed the customer that the associated charges for
11-17 the product or service will appear on the customer's telephone or
11-18 electric bill;
11-19 (2) the customer has clearly and explicitly consented
11-20 to obtain the product or service offered and to have the associated
11-21 charges appear on the customer's telephone or electric bill and the
11-22 consent has been verified and recorded as provided by Subsection
11-23 (b); and
11-24 (3) the service provider offering the product or
11-25 service and any billing agent for the service provider:
12-1 (A) has provided the customer with a toll-free
12-2 telephone number the customer may call and an address to which the
12-3 customer may write to resolve any billing dispute and to answer
12-4 questions; and
12-5 (B) has contracted with the billing utility to
12-6 bill for products and services on the billing utility's bill. The
12-7 contract must include the service provider's name, business
12-8 address, and business telephone number and shall be maintained as
12-9 provided by Subsection (c).
12-10 (b) The customer consent required by Subsection (a)(2) must
12-11 be verified by the person, corporation, or telecommunications or
12-12 electric utility offering the product or service by authorization
12-13 from the customer in the manner prescribed by the commission. A
12-14 record of the customer consent, including verification, must be
12-15 maintained by the person, corporation, or telecommunications or
12-16 electric utility offering the product or service and any billing
12-17 agent for such person, corporation, or telecommunications or
12-18 electric utility for a period of at least 24 months immediately
12-19 after the consent and verification have been obtained.
12-20 (c) The contract required by Subsection (a)(30)(B) shall be
12-21 maintained by the billing utility for as long as the billing for
12-22 such products and services continues and for the 24 months
12-23 immediately following the permanent discontinuation of such
12-24 billing.
12-25 (d) A service provider offering a product or service to be
13-1 charged on a customer's telephone or electric bill and any billing
13-2 agent for the service provider shall not use any fraudulent,
13-3 unfair, misleading, deceptive, or anticompetitive marketing
13-4 practice to obtain customers, including the use of negative option
13-5 marketing, sweepstakes, and contests.
13-6 (e) This section does not apply to customer initiated
13-7 transactions for which the service provider has appropriate
13-8 documentation.
13-9 Sec. 17.152. RESPONSIBILITIES OF A BILLING UTILITY. (a) If
13-10 a customer's telephone or electric bill is charged for any product
13-11 or service without proper customer consent or verification, the
13-12 billing utility, upon its knowledge or notification of any
13-13 unauthorized charge, shall promptly, but in no event later than 45
13-14 days after such knowledge or notification of such charge:
13-15 (1) cease to charge the customer for such unauthorized
13-16 product or service;
13-17 (2) remove any unauthorized charge from the customer's
13-18 bill;
13-19 (3) refund or credit to the customer all money that
13-20 has been paid by the customer for any unauthorized charge;
13-21 (4) upon the customer's request, provide the customer
13-22 with all billing records under its control related to any
13-23 unauthorized charge within 10 business days of the removal of the
13-24 unauthorized charge from the customer's bill; and
13-25 (5) maintain for at least 24 months a record of every
14-1 customer who has experienced any unauthorized charge for a product
14-2 or service on the customer's telephone or electric bill and who has
14-3 notified the billing utility of the unauthorized charge.
14-4 (b) A record required by Subsection (a)(5) shall contain for
14-5 each unauthorized charge:
14-6 (1) the name of the service provider that offered the
14-7 product or service;
14-8 (2) any affected telephone numbers or addresses;
14-9 (3) the date the customer requested that the billing
14-10 utility remove the unauthorized charge;
14-11 (4) the date the unauthorized charge was removed from
14-12 the customer's telephone or electric bill; and
14-13 (5) the date any money that the customer paid for the
14-14 unauthorized charges was refunded or credited to the customer.
14-15 (c) A billing utility shall not:
14-16 (1) disconnect or terminate telecommunications or
14-17 electric service to any customer for nonpayment of an unauthorized
14-18 charge; or
14-19 (2) file an unfavorable credit report against a
14-20 customer who has not paid charges under this section unless the
14-21 dispute is ultimately resolved against the customer.
14-22 Sec. 17.153. RECORDS OF DISPUTED CHARGES. (a) Every
14-23 service provider shall maintain a record of every disputed charge
14-24 for a product or service placed on a customer's bill.
14-25 (b) The record required under Subsection (a) shall contain
15-1 for every disputed charge:
15-2 (1) any affected telephone numbers or addresses;
15-3 (2) the date the customer requested that the billing
15-4 utility remove the unauthorized charge;
15-5 (3) the date the unauthorized charge was removed from
15-6 the customer's telephone or electric bill; and
15-7 (4) the date action was taken to refund or credit to
15-8 the customer any money that the customer paid for the unauthorized
15-9 charges.
15-10 (c) The record required by Subsection (a) shall be
15-11 maintained for at least 24 months following the completion of all
15-12 steps required by Section 17.152(a).
15-13 Sec. 17.154. NOTICE. (a) A billing utility shall provide
15-14 notice of a customer's rights under this section in the manner
15-15 prescribed by the commission.
15-16 (b) Notice of a customer's rights must be provided by mail
15-17 to each residential and business customer within 60 days of the
15-18 effective date of this section or by publication of the next
15-19 telephone directory following the effective date of this section.
15-20 In addition, each billing utility shall send the notice to new
15-21 customers at the time service is initiated or to any customer at
15-22 that customer's request.
15-23 Sec. 17.155. PROVIDING COPY OF RECORDS. A billing utility
15-24 shall provide a copy of records maintained under the requirements
15-25 of Sections 17.152, 17.153, and 17.154 to the commission staff upon
16-1 request.
16-2 Sec. 17.156. VIOLATIONS. (a) If the commission finds that
16-3 a billing utility has engaged in a violation of this subchapter,
16-4 the commission has the authority to implement penalties and other
16-5 enforcement actions pursuant to Chapter 15.
16-6 (b) If the commission finds that any service provider or
16-7 billing agent subject to the provisions of this subchapter has
16-8 engaged in violations of this subchapter or has knowingly provided
16-9 false information to the commission on matters subject to this
16-10 subchapter, the commission may enforce the provisions of Chapter 15
16-11 against the service provider or billing agent as if it were
16-12 regulated by the commission.
16-13 (c) Neither the authority granted under this section nor any
16-14 other provision of this subchapter shall be construed to grant the
16-15 commission jurisdiction to regulate service providers or billing
16-16 agents who are not otherwise subject to commission regulation,
16-17 other than as specifically provided by this chapter.
16-18 (d) If the commission finds that a billing utility
16-19 repeatedly violates this subchapter, the commission may, if such
16-20 action is consistent with the public interest, suspend, restrict,
16-21 or revoke the registration or certificate of the telecommunications
16-22 service provider or electric utility, thereby denying the
16-23 telecommunications service provider or electric utility the right
16-24 to provide service in this state.
16-25 (e) If the commission finds that a service provider or
17-1 billing agent has repeatedly violated any provision of this
17-2 subchapter, the commission may order the billing utility to
17-3 terminate billing and collection services for that service provider
17-4 or billing agent.
17-5 (f) Nothing in this subchapter shall be construed to
17-6 preclude a billing utility from taking action on its own to
17-7 terminate or restrict its billing and collection services.
17-8 Sec. 17.157. DISPUTES. (a) The commission is authorized to
17-9 resolve disputes between a customer and a certificated
17-10 telecommunications utility or an electric utility.
17-11 (b) In exercising its authority under Subsection (a), the
17-12 commission may:
17-13 (1) order a certificated telecommunications utility or
17-14 an electric utility to produce information or records;
17-15 (2) require that all contracts, bills, and other
17-16 communications from a certificated telecommunications utility or an
17-17 electric utility display a working toll-free telephone number that
17-18 customers may call with complaints and inquiries;
17-19 (3) require a certificated telecommunications utility
17-20 or an electric utility to refund overcharges or unauthorized
17-21 charges with interest if the certificated telecommunications
17-22 utility or the electric utility has failed to comply with
17-23 commission rules or a contract with the customer;
17-24 (4) order appropriate relief to ensure that a
17-25 customer's choice of a telecommunications service provider or an
18-1 electric utility that encompasses a geographic area in which more
18-2 than one provider has been certified is honored;
18-3 (5) require the continuation of service to a
18-4 residential or small commercial customer while a dispute is pending
18-5 regarding charges the customer has alleged were unauthorized; and
18-6 (6) investigate an alleged violation.
18-7 (c) The commission shall adopt procedures for resolution of
18-8 disputes in a timely manner which in no event shall exceed 60 days.
18-9 SECTION 4. The importance of this legislation and the
18-10 crowded condition of the calendars in both houses create an
18-11 emergency and an imperative public necessity that the
18-12 constitutional rule requiring bills to be read on three several
18-13 days in each house be suspended, and this rule is hereby suspended,
18-14 and that this Act take effect and be in force from and after its
18-15 passage, and it is so enacted.