SF3991
Utilities permission to charge certain fees
Legislative Session 94 (2025-2026)
Related bill: HF3912
AI Generated Summary
Purpose
- The bill updates rules for how utilities handle payment plans, reconnection, and late fees for customers, with a focus on cold weather protections and clarity around costs. It aims to balance keeping service affordable during difficult times with limits on fees and charges.
Main Provisions
Payment agreements for higher-income households during cold weather
- People whose household income is above 50 percent of the state median income have the right to a payment agreement that takes into account their financial circumstances and other extenuating factors.
- During the cold weather period, these customers may not be disconnected if they make timely payments under an accepted payment agreement, and they must be reconnected if they meet the terms of that agreement.
- A certain prior rule (Subdiv. 7 paragraph b) does not apply to these higher-income customers.
Reconnection fees
- If service was disconnected for unauthorized use or tampering, a utility may charge a reconnection fee based on the cost to reinstate service as listed in the utility’s tariff.
- A utility may not charge a reconnection fee for a residential customer whose service was disconnected due to the customer’s failure to pay a bill.
- Unauthorized use means using utility services in a way that breaches the service contract or tariffs, for reasons other than not paying a bill.
Late payment charges
- A late payment charge may be imposed only if:
- the delinquent amount exceeds $100,
- the charge reflects a reasonable approximation of the actual cost to carry the unpaid balance, and
- the utility does not impose more than $50 in cumulative late payment fees on a single customer in a 12-month period.
- Exemptions from late charges:
- low-income households or those in designated low-income programs,
- households that have entered into and are reasonably up to date on a payment agreement.
- For rate-regulated utilities (public utilities or electric co-ops), a late payment charge may be imposed only if the commission finds, with clear and convincing evidence, that the late charge is just, reasonable, and in the public interest.
Significant Changes to Existing Law
- Adds new protections and rules for reconnection fees and late charges, including:
- A new subd.8 that allows reconnection fees only for unauthorized use or tampering and not for nonpayment.
- A new subd.9 that places specific limits and exemptions on late payment charges, plus a requirement for regulatory approval in certain cases.
- An amendment to provide payment agreement protections for higher-income households during the cold weather period, with an exception to a prior provision for these customers.
Practical Implications
- For many households, especially those with incomes above 50% of the state median, there will be a formal path to a payment plan during cold weather, with protection against disconnection if they meet the plan.
- Utilities can charge reconnection fees only in cases of unauthorized use or tampering, not simply for failing to pay a bill.
- Late fees are capped and mostly limited to customers who are not low income or already in approved payment arrangements; oversight by the Public Utilities Commission is required to ensure any late fees are fair.
Important Terminology and Concepts (embedded terms to recognize)
- payment agreement
- 50 percent of state median income (50% SMI)
- cold weather period
- may not be disconnected
- reconnected / reconnection
- unauthorized use
- tampering
- reconnection fee
- tariff
- delinquent amount
- actual cost to carry the unpaid balance
- cumulative late payment fees
- $50 cap (per 12 months)
- low-income households
- low-income programs (e.g., specified sections)
- rate-regulated utilities
- public utility / electric cooperative
- commission (licensing/regulatory oversight)
- just and reasonable / in the public interest
Relevant Terms payment agreement 50 percent of state median income cold weather period disconnected reconnected reconnection fee unauthorized use tampering tariff late payment charge delinquent amount actual cost to carry the unpaid balance cumulative late payment fees $50 cap low-income households low-income programs rate-regulated utilities Public Utilities Commission just and reasonable public interest
Bill text versions
- Introduction PDF PDF file
Actions
| Date | Chamber | Where | Type | Name | Committee Name |
|---|---|---|---|---|---|
| March 02, 2026 | Senate | Action | Introduction and first reading | ||
| March 02, 2026 | Senate | Action | Referred to | Energy, Utilities, Environment, and Climate |
Citations
[
{
"analysis": {
"added": [
"Creates or clarifies a right to a payment agreement for high-income customers during cold weather and limits disconnections if they are in the payment agreement."
],
"removed": [
"Removed prior authority to disconnect high-income customers during cold weather when not under a payment agreement."
],
"summary": "Amends Minnesota Statutes 2024 section 216B.096, subdivision 10 to provide protections for customers with household income above 50% of state median income during the cold weather period, including the right to a payment agreement and prohibition on disconnection, with reconnection upon timely payment.",
"modified": [
"Subd. 10 language amended to implement these protections."
]
},
"citation": "216B.096",
"subdivision": "subdivision 10"
},
{
"analysis": {
"added": [
"Links the ability to support an exemption to late payment charges under 216B.096, subdivisions 5 and 10 through payment agreements."
],
"removed": [],
"summary": "References 216B.096, subdivision 5 in the context of payment agreements that may affect late payment charge exemptions.",
"modified": [
"Noted as part of the framework for payment agreements referenced in late payment charge determinations."
]
},
"citation": "216B.096",
"subdivision": "subdivision 5"
},
{
"analysis": {
"added": [
"Authority to charge a reconnection fee after disconnection for unauthorized use or tampering; fee based on tariffed cost to reinstate service."
],
"removed": [],
"summary": "Adds Subd.8 to 216B.098 allowing a utility to charge a reconnection fee after disconnection due to unauthorized use or tampering, based on the cost to reinstate service as stated in the tariff; prohibits reconnection fees for residential nonpayment disconnections.",
"modified": []
},
"citation": "216B.098",
"subdivision": "subdivision 8"
},
{
"analysis": {
"added": [
"Late payment charges may be imposed only if delinquent amount exceeds $100; charges must reflect reasonable actual cost; no more than $50 in cumulative late payment fees in a 12-month period; exemptions for low-income households and those in specified programs or payment agreements; commission may require justification for charges."
],
"removed": [],
"summary": "Adds Subd.9 establishing conditions for late payment charges, including thresholds, cost-based limits, and a cap on cumulative charges; provides exemptions for low-income households and those in certain programs or payment agreements; allows Commission review for just and reasonable charges.",
"modified": []
},
"citation": "216B.098",
"subdivision": "subdivision 9"
},
{
"analysis": {
"added": [
"Cross-reference to 216B.097(2.1) as part of the exemptions from late payment charges for eligible customers."
],
"removed": [],
"summary": "References 216B.097, subdivision 2.1 (paragraph a, clause 2) as part of the framework for late payment charge exemptions related to certain payment arrangements.",
"modified": []
},
"citation": "216B.097",
"subdivision": "subdivision 2.1"
},
{
"analysis": {
"added": [
"Affirms that a public utility or electric cooperative under rate regulation may impose a late payment charge only if the charge is just, reasonable, and in the public interest as determined by the commission."
],
"removed": [],
"summary": "Cites 216B.026 in connection with rate-regulated utilities and their authority to impose late payment charges.",
"modified": []
},
"citation": "216B.026",
"subdivision": ""
},
{
"analysis": {
"added": [
"Uses the definition of a low-income household from 216B.16, subdivision 1b."
],
"removed": [],
"summary": "References 216B.16, subdivision 1b for defining low-income households used for exemptions and program eligibility.",
"modified": []
},
"citation": "216B.016",
"subdivision": "subdivision 1b"
},
{
"analysis": {
"added": [],
"removed": [],
"summary": "References 216B.2403, subdivision 5 related to low-income programs referenced for exemptions applicable to late charges.",
"modified": []
},
"citation": "216B.2403",
"subdivision": "subdivision 5"
},
{
"analysis": {
"added": [],
"removed": [],
"summary": "References 216B.241, subdivision 7 in relation to low-income programs used for exemptions from late charges.",
"modified": []
},
"citation": "216B.241",
"subdivision": "subdivision 7"
}
]Progress through the legislative process
In Committee