The Public Service Commission of Maryland, in these regulations referred to as the “Commission,” declares that it is in the public interest for each utility to fairly and without discrimination administer a reasonable policy reflected by written regulations, in accord with these regulations, which will permit an applicant for permanent residential service to establish, or an existing residence customer to re-establish, credit with the utility for the use of its service. The Commission further declares that when it is necessary for an applicant or customer to make a cash deposit to establish or re-establish credit in accord with these regulations, the making of the deposit is in the public interest because it avoids, to the extent practicable, the creation of a burden arising from uncollectible bills which would have to be borne ultimately by all the utility's rate payers. The Commission further declares that the essential ingredient in each utility's administration of its deposit policy, as expressed by these regulations, is the equitable and indiscriminate application of that policy to all applicants for service and customers throughout its service area without regard to the economic character of the area or any part of it, and that this deposit policy shall be predicated upon the credit risk of the individual without regard to the collective credit reputation of the area in which he lives. Except as provided in §C of this regulation, a utility may require each applicant for residential service to establish credit in compliance with the methods and procedures listed in §B of this regulation. Methods of Establishing Credit. In order to establish credit, a utility may require an applicant for residential service to demonstrate good paying habits by showing that the applicant: Was a customer of a Maryland utility within the preceding 2 years; Does not currently owe any outstanding bills for utility service to a utility doing business in Maryland; Did not have service discontinued for non-payment of a utility bill during the last 12 months that service was provided; and Did not on more than two occasions during the last 12 months that service was provided, fail to pay a utility bill when it became due. In addition to demonstrating good paying habits under §B(1), a utility may require an applicant for residential service to satisfy any one of the following in order to establish credit: Certifying continuous employment for 3 years with current employer; Showing the ownership of or a contract for the purchase of the dwelling unit for which service is requested and either occupying it or intending to occupy it as the applicant's personal place of residence; Furnishing a guaranty satisfactory to the utility to secure payment of bills for the service requested in an amount not to exceed the amount of the cash deposit under Regulation .04 of this chapter; or Otherwise establishing credit satisfactory to the utility in conformance with additional reasonable regulations which it may adopt. A guaranty under §B(2)(c) shall be in writing and continue in effect for 1 year from the installation date of the service, or until the applicant's credit is otherwise established. If an applicant for residential service is unable to establish credit under the provisions of §B(1) and (2), a utility may require the applicant to establish credit by making a cash deposit to secure payment of a final bill for service under Regulation .04. If an applicant is subject to outstanding judgments, a utility may require the applicant to establish credit by furnishing a guaranty under §B(2)(c) and (3), or by making a cash deposit under Regulation .04 of this chapter. The establishment of credit under this regulation does not relieve the applicant or customer from compliance with the reasonable regulations of the utility as to prompt payment of bills, and does not relieve the customer from having service terminated for non-payment of bills due for service furnished. A utility shall advise all applicants for service that a customer may be required to reestablish credit under Regulation .03 if the conditions of service or the basis on which credit was originally established materially change. Exemption for Individuals 60 Years Old or Older. An individual 60 years old or older applying only for residential service is exempt from any cash deposit requirement if the individual presents satisfactory proof of: Age; Intent to be the primary consumer of the service as evidenced by lease, mortgage, rental agreement, or title to the dwelling unit to be served being maintained in the name of the applicant; and The absence of any outstanding bill owed to a utility for service. A utility may require an applicant for residential service who is a present or former residential customer of that utility to reestablish credit under Regulation .02 of this chapter at the time of the application if one of the following exists: Customer owes an outstanding bill for a prior residential service; Customer's residential account had been terminated by the utility during the last 12 months of prior service because of nonpayment of bills; Customer failed to pay a bill when it became due on more than two occasions in the last 12 months of prior service; Customer's residential account is more than 2 months in arrears; or Conditions of service or the basis on which the customer's credit was originally established have materially changed. A residential customer who has established credit and is receiving service, but who fails to pay a bill by the expiration date of a termination of service notice, may be required by the utility to reestablish credit by depositing the amount prescribed in Regulation .04 of this chapter in addition to paying the outstanding bill and a reasonable reconnection charge, provided that any prior deposit paid by the customer has been refunded. Amount of Deposit. The deposit required by the utility may not be less than $5 or more in amount than 2/12 of the estimated charges for service for the ensuing 12 months, except that an amount equal to 3/12 of the estimated charge for service for the ensuing 12 months will be permitted for those utilities which bill quarterly. If the actual billing is substantially different from the estimated charge for service, then the amount of the deposit may be adjusted to the applicable proportion of the actual billing. Deposit Receipt. Each utility shall issue a receipt of deposit to each customer from whom a deposit is received, and shall provide means by which a depositor may establish his claim if his receipt is lost. Interest on Deposits. Each utility shall pay simple per annum interest on a deposit from the date of receipt by the utility. The rate in §C(1) of this regulation shall be a weighted monthly average of calendar year rates appropriate to the holding period. Calendar Year Rates. The calendar year rates shall be established in December of each year to be effective January 1 of the following year. The rate shall be equal to the average of the percent yields of 1-year treasury constant maturities for September, October, and November of the preceding year. Payment of Interest. Interest shall be paid annually, if requested by the customer, or at the time the deposit is returned. Cessation of Interest. The obligation to pay interest on a deposit shall cease upon one of the following events: The date it is returned or credited to the customer's bill for service; The date service is terminated; or The date notice is sent to the customer's last known address that the deposit is no longer required. Record of Deposit. Each utility shall keep records to show: The name and address of each depositor; The amount and date of the deposit; and Each transaction concerning the deposit. Unclaimed Deposits. Unclaimed deposits, with accrued interest, shall be credited to an appropriate account, or shall otherwise be disposed of in accordance with Commercial Law Article, Title 17, Annotated Code of Maryland. Payment of Deposit. A utility shall provide an installment plan for the payment of deposits in excess of $50. The installment plan may require a customer to pay the greater of $50 or one-third of the total deposit by the date that service is provided. A utility shall offer a customer the option to pay a required deposit amount: Between $50 and $150 in even installments over a period of at least 8 weeks; or Over $150 in even installments over a period of at least 12 weeks. The customer shall be notified of this right at the time of the initial deposit request and in the utility's customer rights pamphlet. A utility may apply a residential customer deposit plus accrued interest, first against any unpaid balance due the utility for that service as determined by the final bill issued to the customer, and then against any unpaid balance due the utility on any other residential account of that customer. Discontinuance of Service. Upon discontinuance of service, the utility shall promptly and automatically refund the customer's deposit plus accrued interest, or the balance, if any, in excess of the unpaid bills for service furnished by the utility. A transfer of service from one premises to another within the service area of the utility may not be deemed a discontinuance of service within the meaning of these regulations. Good Payment Record. If the customer has paid bills for service for the first 12 months of service following payment of his deposit without having had service discontinued for non-payment of bill or without having had more than two occasions in which a bill was not paid when it became due, and the customer is not then delinquent in the payment of his bills, the utility shall promptly and automatically refund the deposit plus accrued interest. If the customer has had service terminated for non-payment of his bill or had more than two past due bills for the period, the utility shall thereafter review the account every 12 months and shall promptly and automatically refund the deposit plus accrued interest after the customer has not had service terminated for non-payment of bill or bill or had more than two past due bills during the 12 months before any review and is not then delinquent in the payment of his bills. Establishment of Credit. The utility shall promptly return the deposit plus accrued interest at any time upon request if the customer's credit has been established in accordance with the methods specified in Regulation .02B, provided the customer owes no outstanding bills for the service and during the last 12 consecutive months that service was provided has not had more than two occasions in which a bill was not paid within a reasonable period after it became due or had service terminated for non-payment of the bill. Customers 60 Years Old or Older. A utility shall promptly refund the deposit plus interest of a present customer who is 60 years old or older provided the customer: Requests refund of the deposit; Presents satisfactory proof of age; and Does not have a past due or uncollected bill owing to the utility. Option of Utility. At the option of the utility, a deposit plus accrued interest may be refunded, in whole or in part, at any time earlier than the times prescribed in this regulation. Appeal to Utility Supervisory Personnel. Each utility shall direct its personnel engaged in initial contact with an applicant for service, or customer seeking to establish or re-establish credit under the provisions of these regulations to refer the applicant or customer, at his request, to supervisory personnel for further consideration of his problem. Appeal to Commission Personnel. Each utility shall further direct the supervisory personnel to inform the applicant or customer who expresses dissatisfaction with the decision of the supervisory personnel, of his right to have the problem reviewed by the Commission and shall furnish him with the business address and telephone number of the Commission. Each utility, upon request, shall furnish a copy of these regulations to the applicant for service or customer from whom a deposit is required and the copy shall contain the name, address, and telephone number of the Commission. Public Utilities Article, §§2-113, 2-121, 4-503(a), 5-101, and 5-105, Annotated Code of Maryland Effective date: July 1, 1970 (Order No. 58089) Regulations .02 and .03 repealed effective November 18, 1985 (12:23 Md. R. 2222) Regulations .02, .03, and .04-1 adopted effective November 18, 1985 (12:23 Md. R. 2222) Regulation .04 amended effective November 18, 1985 (12:23 Md. R. 2222) Regulation .04C amended effective March 1, 1993 (20:4 Md. R. 373) Regulation .04G amended effective September 21, 2009 (36:19 Md. R. 1438) Regulation .04H amended effective January 26, 1979 (6:2 Md. R. 75); April 21, 1986 (13:8 Md. R. 903) Regulation .04H amended as an emergency provision effective January 1, 2002 (29:3 Md. R. 214); emergency status expired June 30, 2002 Regulation .04H amended as an emergency provision effective January 1, 2003 (30:5 Md. R. 364); amended permanently effective January 20, 2003 (30:1 Md. R. 28) Regulation .04I adopted effective January 1, 1978 (Order No. 62792) Regulation .05 amended effective November 18, 1985 (12:23 Md. R. 2222)