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HomeMy WebLinkAbout2017-07-12 Utilities Advisory Commission Agenda Packet NOTICE IS POSTED IN ACCORDANCE WITH GOVERNMENT CODE SECTION 54954.2(a) OR 54956 I. ROLL CALL II. ORAL COMMUNICATIONS Members of the public are invited to address the Commission on any subject not on the agenda. A reasonable time restriction may be imposed at the discretion of the Chair. State law generally precludes the UAC from discussing or acting upon any topic initially presented during oral communication. III. APPROVAL OF THE MINUTES None IV. AGENDA REVIEW AND REVISIONS V. REPORTS FROM COMMISSIONER MEETINGS/EVENTS VI. DIRECTOR OF UTILITIES REPORT VII. COMMISSIONER COMMENTS VIII. UNFINISHED BUSINESS None IX. NEW BUSINESS 1. Utilities Department Strategic Planning Workshop with City Consultants Discussion 2. Preparation for Council and Utilities Advisory Commission Joint Study Session Discussion 3. Discussion Regarding Utilities Leak Adjustment Rules Discussion 4. Selection of Potential Topic(s) for Discussion at Future UAC Meeting Action NEXT SCHEDULED MEETING: August 2, 2017 ADDITIONAL INFORMATION The materials below are provided for informational purposes, not for action or discussion during UAC Meetings (Govt. Code Section 54954.2(a)(2)). Public Letters to the UAC 12-Month Rolling Calendar UTILITIES ADVISORY COMMISSION - SPECIAL MEETING WEDNESDAY, JULY 12, 2017 – 7:00 P.M. COMMUNITY MEETING ROOM Palo Alto City Hall – 250 Hamilton Avenue Chairman: Michael Danaher  Vice Chair: Arne Ballantine  Commissioners: Lisa Forssell, A. C. Johnston, Judith Schwartz, Lauren Segal and Terry Trumbull  Council Liaison: Eric Filseth Page 1 of 7 3 MEMORANDUM TO: UTILITIES ADVISORY COMMISSION FROM: UTILITIES DEPARTMENT DATE: July 12, 2017 SUBJECT: Discussion Regarding Utilities Leak Adjustment Rules RECOMMENDATION Staff requests that the Utilities Advisory Commission (UAC) discuss and provide feedback to staff regarding the current Utilities Policy for the financial billing of potable water and natural gas leaks occurring on the customer’s side of the revenue meter. If the UAC wishes to provide feedback on the current policy or alternatives for reasons of business process improvements or customer satisfaction, staff can return for a follow-up discussion and/or action based upon customer or business parameters identified in UAC discussion. EXECUTIVE SUMMARY To summarize the CPAU policy for water and natural gas leaks: if water or natural gas has passed through the revenue meter serving the customer and that meter is accurate within the established CPAU standards, it is the customer’s responsibility to pay the bill, unless it can be shown that CPAU was responsible for the increased consumption. BACKGROUND Current Policy A policy change to Utilities Rule and Regulation 11, “Billing, Adjustments and Payments of Bills”, Section L., “Water or Gas Leak Credits”, was adopted by Council on May 9, 2006 (CMR : 219:06): L. WATER OR GAS LEAK CREDITS (from 5-9-2006 to present) It is the Customer’s responsibility to maint ain their lines and equipment in a reasonable condition such that leaks do not occur. CPAU shall not make billing adjustments for Water, Gas or Wastewater Charges resulting from leakage in a line on the Customer Premises beyond the CPAU Meter, unless CPAU determines that City staff were solely responsible for such leakage. Water is a metered service and the City’s responsibility ends where the water exits the meter and is taken into the customer's distribution lines. It is the customer’s responsibility to maintain their distribution lines and end-use equipment so that leaks do not occur. Based on this principle, no Utilities usage or payment credits are given for water leaks once the water has passed through the meter and consumption has been counted. Rule 11(I) of the City of Palo Page 2 of 7 Alto’s Utilities Rules and Regulations requires that all utility billing errors, both instances of underbilling and overbilling, be corrected over a three year look-back period. This Rule is designed to ensure fairness to all customers, such that some customers do not effectively subsidize leaks on other customers’ properties. The City’s bright line rule for water leaks is consistent with statewide water regulatory trends that put a premium on water conservation and are focused on eliminating water waste. The rule is clear and facilitates consistent application by staff in a manner that has the potential to strengthen the C ity’s position should the City become involved in litigation over costs or charges in the future. City staff does encourage customers to investigate whether their homeowner insurance policy covers the costs associated with leaks. The Utilities Department also works with customers to devise a payment arrangement for back bills to address financial hardship by spreading payments over extended periods. Prior Policy The prior leak credit policy (effective 11-22-1999 until 5-9-2006), also under Rule and Regulation 11, but as Section G, “Billing Adjustments”, Subsection 4, “Water or Gas Leak Credits”, and Subsection 5, “Billing Adjustments in Connection with Force Majeure Events” stated: 4. WATER OR GAS LEAK CREDITS: (from 11-22-1999 through 5-9-2006) Billing adjustments may be made for water or gas lost as a result of leakage in a line on the Customer premises beyond the CPAU meter. Leaking faucets, toilets, hoses, or sprinklers do not qualify for a billing credit unless a determination has been made by CPAU that the Customer had no control of such device(s) leaking. Under no circumstances will a billing credit be provided a Customer when the facts indicate that a Customer had knowledge of a water or gas leak, but failed to take corrective measures in a timely manner. It is the Customer’s responsibility to maintain their lines and equipment in a reasonable condition such that leaks do not occur. (A) Generally, a leakage credit will be granted for a one month billing cycle. However, depending on the circumstances, a two-month billing cycle may be granted by the Supervisor, Customer Service Center. Such circumstances include, but are not limited to, a leak occurring while a Customer is out of town for an extended period of time. Leak credits will not be provided beyond a two-month billing cycle. (B) All Customer classes are eligible for the leak credit. To qualify for the water leak credit, evidence of having repaired the leak is required. Such evidence may consist of a plumber’s repair bill, materials receipt, or field verification by CPAU. Customers who are negligent or slow to react in repairing a leak do not qualify for a leak credit. (C) To arrive at the corrected bill amount, which reflects the leak credit, CPAU will estimate what would have been the normal consumption and Page 3 of 7 calculate a normal bill based on that consumption. Then, actual consumption in excess of the normal figure will be billed at CPAU’s current wholesale commodity cost plus ten percent. The sum of these two calculations represents a revised billing amount. The leak credit is the difference between the revised billing amount and the original bill. 5. BILLING ADJUSTMENTS IN CONNECTION WITH FORCE MAJEURE EVENTS (A) For purposes of this Rule and Regulation, the term “force majeure” means the occurrence of an event that is beyond the reasonable control of the utility Customer and, which by reasonable efforts, the Customer could not prevent. Such events include, but are not limited to, an Act of God, an irresistible, superhuman cause, fire, flood, earthquake, or any other similar cause. (B) Water, Gas, and/or Electric (1) A water, gas, and/or electric billing adjustment in connection with a force majeure event shall be limited to charges for water, gas, and/or electricity consumption in excess of the historical average for the customer. The billing adjustment will be applied as a credit on the customer’s bill. The credit is for the amount of excess usage and represents the difference between the amount charged for the applicable period and an amount calculated based on the customer’s average consumption for a similar period. This credit shall include a refund of any applicable utilities users tax that was based on the amount of excess usage. (2) The Director of Utilities shall determine the historical average consumption. Depending on the availability of data and other reasonable considerations, the basis for calculating such averages may be the same month(s) in a previous year, a recent 12 month average, a 6 month seasonal average for winter or summer, or other appropriate period(s) as determined by the Director of Utilities. (C) Debris Boxes (1) A billing adjustment or refund in connection with debris boxes serviced by the City’s contracted Collector shall be limited to City’s Collector charges incurred or to be incurred out-of-pocket by the resident, owner, or business for removal of flood -damaged materials only. Refunds will not be applied to charges paid through insurance policies. The City’s Collector will keep a record of those residences and businesses that request debris boxes during the applicable refund period. Page 4 of 7 (D) To qualify for an adjustment under this section, the Customer may be required to provide documentation to verify damage to the residence or building, or contents thereof. In circumstances in which the City has previously verified such damage such as by a field visit or has made a determination from other information resources, documentation from the Customer may not be required. However, to qualify for a refund for debris box rentals, a signed statement by the Customer is required that attests that the debris box was used for flood-damaged materials only and that the Customer has not and will not be reimbursed by homeowners insurance or any other agency. (end) The implementation difficulty that CPAU had with this earlier policy included:  Regulatory definitions were difficult to consistently interpret and apply.  Not being responsible for the full cost of repairing irrigation leaks and defective plumbing equipment has the potential to prevent some customers from upgrading, properly maintaining/inspecting, or repairing older, defective, or degraded plumbing.  Extensive time and expense was required by CPAU field, office and management staff to investigate and interpret instances of high water consumption…essentially having to prove to the customer that there was a leak for which they were responsible.  Determine the relative merits of each submission, and to establish and maintain precedents. For instance, customers (still) argue that “there was no way they could have used that much water” because they weren’t home, there was no standing water indicating the presence of an irrigation leak, there was no running toilet, etc.; and,  Did not preclude customers from both filing for a reduced-payment CPAU water leak adjustment and filing a claim with their insurance carrier for the full retail value of the water bill. DISCUSSION CPAU uses a manual meter reading process that occurs once per billing cycle, or roughly once per month. CPAU Customer Services staff attempts to contact the affected customer as soon as the abnormally high reading is downloaded from the meter reading device and identified. In between two meter reading periods a variety of high water consumption events could have taken place some visible to the naked eye (wet spots in landscaping, broken irrigation head, water flowing down the gutter or across hardscape), and some not (running toilet, under slab burst pipe, or water heater valve discharging under the house). There are three types of leaks that ordinarily occur: (1) the slow leak where consumption gradually increases to the point where it seems excessive to the customer, or out-of-range to CPAU, (2) the single-event burst pipe/irrigation valve, and (3) the single-event “Unknown Cause”, with no visible problem, no one admitting to be in residence, and no wet spots noticed by the gardener. All three events result in high consumption and high bills. They also result in customer calls to the Utilities Call Center. Page 5 of 7  For Fiscal Year 2016-2017 (11 months to date) there have been 509 double-checks of the original water meter reading resulting from customer calls about their high water bills.  For Fiscal Year 2016-2017 (11 months to date) there have been 1,925 double-checks of an original water meter reading resulting from “out-of-range” meter readings in the billing system. The vast majority of “check-reads” have been found to be accurate. There are approximately 20,600 water meters in the system totaling 247,200 water meter readings per year. The consolidated annual meter reading error rate (915,100 water, gas, electric meter readings) is less than 0.05%. Since 2009 there have been 74 escalated calls about high water consumption requiring the attention of a supervisor or manager. Of these, there have been approximately one dozen significant-volume water leaks where the dollar values of these leaks ranged from several hundred to several thousand dollars (high of $7,000). The causes of these leaks encompassed all three of the types identified above (irrigation system failures, running toilets, or “unknown causes”). When confronted with the reality of a water leak, customers mitigate the situation in several ways. Aged, leaking toilets are identified through home visits of CPAU water efficiency contractors, or by using dye tablets available from local hardware stores. The toilet is then repaired or replaced with a more efficient low volume model. Leaking irrigation systems can be discovered from broken sprinkler heads or valves, or from soft or wet spots in yard or turf. Locating deeper irrigation leaks or the troublesome “unknown causes” may require the services of a specialized leak detection company using sophisticated acoustical or H2 tracer sensor technologies. Preventing future high bills from water leaks can be addressed by homeowner installation of wired or wireless water leak alarms and/or sensors installed in basements or on the customer’s side of the CPAU water meter. If CPAU moves forward with the procurement and installation of “smart” water meters, customers would also be provided with built -in leak detection and notification capabilities. Alternative Policies Used by Other Water Agencies Each water agency, public or private, typically has their own policy and/or methodology for handling water bill reductions due to high water consumption. These policies range from formal to informal to none. Specific water leak policy language can be found in Municipal Codes, Ordinances, Fee Schedules, Rate Schedules, Department Policies, and other references commonly available to the public. Agencies without specific policies or remedies do not address the topic at all in their customer-facing publications. Policies include: 1. Some agencies include language stating that maintaining and repairing the water distribution system on the customer’s side of the meter is the cust omer’s responsibility. 2. Agencies variously define “water leak”. For instance, some consider a “water leak” to mean: a) plumbing failures on the customer’s side of the meter due to normal “wear and tear”, b) a plumbing failure event “not resulting from theft, vandalism or other Page 6 of 7 third-party actions”, c) increased water consumption over time as a result of broken pipes or fittings, or d) a single event, catastrophic failure of a water line or appliance. 3. Some agencies do not provide specific regulatory remedies. Requests for billing adjustments are handled administratively through the department or City Manager’s Office on a case by case basis. 4. Some agencies have “water leak adjustment” policies that provide specific regulatory remedies in the event of a water leak. These include: a) reduction in charges to the lowest applicable rate Tier, b) time/term limits on the number/years that adjustments requests can be made (i.e. once every three years; once per lifetime; etc.), c) proof of completed leak repair, d) a maximum number of bills that can be adjusted, e) an adjustment maximum for dollars or percentage of bill (i.e. a 25% cap on bill reduction), and f) minimum years of water agency service to qualify for a leak adjustment. NEXT STEPS The UAC may wish to provide input on the current policy for water and gas leak adjustments as stated in Rule and Regulation 11. Depending upon UAC’s feedback, staff may consider returning with alternatives based upon customer or business parameters identified in UAC d iscussion. RESOURCE IMPACT Maintaining the current policy for water and gas leak adjustments as stated in Rule and Regulation 11, there will be no future financial impact to the Water Fund. Adoption of an alternative policy will require financial impacts to be calculated based upon the recommended policy. POLICY IMPLICATIONS The current City of Palo Alto Utilities policy for the handling of water leaks was approved by Council in 2006. Specific changes to the current policy may require the amendment of Utility Rules and Regulations and/or development of internal guidelines for department implementation. ENVIRONMENTAL REVIEW Discussion of and solicitation of feedback from the UAC concerning the City’s water leak adjustment rules does not meet the definition of a project under the California Environmental Quality Act (CEQA), pursuant to Public Resources Code Section 21065. ATTACHMENTS A) City of Palo Alto Utilities Rule and Regulation 11, "Billing, Adjustments and Payments of Bills" (2016) B) City of Palo Alto Utilities Rule and Regulation 11, "Billing, Adjustments and Payments of Bills" (1999) PREPARED BY: TOM AUZENNE, Assistant Director-Customer Support Service~ REVIEWED BY: ~ATCHELOR, Chief Operating Officer APPROVED BY: [___ / ~ EDSHIKADA General Manager of Utilities Page 7of7 BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 1 A. BILLING UNITS All metered billing units used for billing purposes shall be determined to the nearest whole unit. Such units may include, kW, kWh, kVA, kVar, hp, Therms, and/or ccf. B. PAYMENT OF BILLS CPAU issues bills to its Customers on a regular interval. Bills shall be deemed received upon physical or electronic delivery to Customer, or three calendar days following the deposit of the bill in the United States Mail to the Customer’s billing address. Bills for CPAU Services are due and payable 20 calendar days following issuance of the bill statement. Bills unpaid after the 20 day period are considered delinquent (“past due”). If a Customer’s payment is not received by CPAU after 25 days of bill issuance, the outstanding balance will be assessed a late payment Charge. For the convenience of Customers there are a number of ways to pay CPAU bills: 1.By enclosing the bill stub and check and mailing to: CPAU, P.O. Box 10097, Palo Alto, CA 94303-0897. 2.By enrolling in the Utilities Bank Draft Program. Payments will be drafted from a Customer’s designated checking or saving account and automatically applied to the Customer’s Utility Account for each current Billing Period. 3.By paying in Person at the Civic Center, Revenue Collections, 1st Floor, 250 Hamilton Avenue, Palo Alto between the hours of 8:00 a.m. and 4:30 p.m. The City offices are closed on alternate Fridays. Customers should call 650-329-2317 to ensure the office is open. Credit card payments are accepted at Revenue Collections. Customers should call to see which credit cards are accepted. Customers can pay delinquent bills with a credit card by phone by calling the Utility Customer Service Center during business hours. 4.By depositing the payment in the walk-up Night Depository Box in the front of the City Hall building on the Civic Center Plaza, or at the drive-up Night Depository Box in the Civic Center Garage, on “A” Level. 5.By paying online through the “My Utilities Account” application, accessible from the ATTACHMENT A BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 2 Utilities’ website. Payment through the “My Utilities Account” may be made by credit card or by bank draft. 6. By enrolling at a financial institution or service company that can provide electronic payments to CPAU on behalf of the Customer. 7. By Property Managers completing a “Revert to Owner (RTO) Agreement” in order to maintain utility service to units during the interim period between tenants. C. BUDGET BILLING PAYMENT PROGRAM The Budget Billing Payment Program establishes equalized monthly payments and is available to all Residential Customers who qualify as set forth below: 1. Customers may join the Budget Billing Payment Program at any time providing the Customer Account balance is zero and the Customer has not been previously removed from the Budget Billing Program for non-payment. 2. A Customer electing to utilize the program shall agree to make monthly payments based on CPAU’s forward estimate of the Customers’ Charges for the subsequent twelve-month period. 3. CPAU does not guarantee that the total actual Charges will not exceed, or be less than, its original estimate. Customers should review their Account on an ongoing basis and request changes to the budget billing amount in response to changes in their household usage. CPAU may require that Customers pay a revised monthly amount as a condition to continuing participation in the plan, if CPAU determines that substantial changes in Customer usage patterns or consumption has occurred. 4. CPAU will perform an annual true-up on Customer Budget Billing Accounts every twelve months. This will result in either a Customer credit for CPAU over-collection or an outstanding balance due from the Customer for under-collection by CPAU during the prior twelve months. D. DISCONTINUANCE OF BUDGET BILLING BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 3 The Customer’s Budget Billing Payment Program shall remain in effect, subject to review of the monthly payment amount, and shall terminate when: 1. The Customer notifies CPAU to terminate participation in the Budget Billing Program; 2. CPAU notifies the Customer of the termination of its Budget Billing Payment Program: 3. The Customer no longer takes Service at the Premises; or 4. The Customer owes an amount of two or more monthly payments. However, if the Customer eliminates the delinquency, removal from the program will not occur. Upon termination of either Utility Service or participation in the Budget Billing Payment Program, any amount owed by the Customer for actual Charges shall immediately become due and payable or any amount due to the Customer shall be refunded or credited. E. INSUFFICIENT FUNDS FOR PAYMENT 1. A Service Charge will be made and collected by the City of Palo Alto for each check returned by a bank to CPAU for the reason of insufficient funds in accordance with Rate Schedule C-1. 2. Unsuccessful Bank Drafts due to insufficient funds will be subject to late payment fees in accordance with Rate Schedule C-1. F. PRORATION OF BILLS 1. Bills for Utility Services will be prepared for each Billing Period in accordance with the applicable Rate Schedules or CPAU contract applicable to the Premises served. 2. Proration is intended to produce a uniform average unit cost for the commodity regardless of the number of days in the Service period. Services will be prorated if the number of actual Service days differs from the number of days in the applicable Billing Period. Electric Demand (kW) and Electric Power Factor Charges will not be prorated. Proration will not occur for those Rate Schedules that contain Meter fees, connection fees, deposits, and other miscellaneous fees. BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 4 3. If Rate Schedules change during the Billing Period, Charges will be prorated on the basis of the number of days covered by the previous Rate Schedule and the number of days covered by the new Rate Schedule. G. DELINQUENT BILLS AND LATE PAYMENT CHARGES 1. Utilities Charges incurred in the applicable Billing Period are due and payable by the “Due Date” indicated on the front of the bill statement. Bills unpaid by the due date are delinquent and a late payment Charge will be added to the outstanding balance as specified in Rate Schedule C-1. 2. Residential and commercial Accounts having unpaid balances older than 180 days shall be subject to collection action by the City. Collection action may result in notifications to credit reporting agencies. 3. Late payment Charges may be suspended by CPAU if the Customer is withholding full or partial payment pending final resolution of disputed bill. The late payment Charge may be waived by CPAU based upon the ultimate resolution of a disputed Charge. 4. Full or partial payments towards outstanding balances will be applied to the oldest outstanding Charges. Failure to pay outstanding balances will result in late fees and termination of Service for non-payment. 5. In the event that a Customer donating to the ProjectPLEDGE Program has a delinquent bill, the late Charge percentage will not be applied to the amount of the Customer’s pledge. However, the Customer’s participation in ProjectPLEDGE will be discontinued after three consecutive Billing Periods in which the Customer has not included their pledge amount in the bill. 6. Customers whose Utility bills include payments of principal and/or interest on loans from CPAU which are secured by deeds of trust on real property shall be charged a late payment Charge when any current Utility bill includes an unpaid installment on such loan from a prior bill. Nothing in this Rule and Regulation shall be construed to alter in any way the duty of the Customer to pay any installment on a loan from CPAU when due, or to alter the rights of CPAU to enforce the payment of such installments. BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 5 H. DISPUTED BILLS If bill accuracy is questioned or disputed by the Customer, Customers shall request an explanation from CPAU within the current Billing Period or as soon as reasonably possible. After reviewing the disputed bill, CPAU will: 1. Issue a corrected bill to the Customer or reflect the correction on the bill in a subsequent Billing Period. 2. Determine if an amortization period (“payment arrangement”) for the Charge-in-question shall be provided by CPAU. If a payment arrangement is offered by CPAU and agreed to by the Customer, Utility Services will not be discontinued for nonpayment while the Customer complies with the payment arrangement for the “past due” balance , and subsequent Utilities bills are paid on time during the payment arrangement period. 3. Advise the Customer that the bill is correct as presented. The Customer may choose, at the Customer’s option, to have the Meter removed for testing under the Provisions of Rule 15 “Metering” and payment of the applicable fee found in Rate Schedule C-1 “Exchange Meter for Accuracy Test”. I. METERED SERVICE BILLING ERRORS AND ADJUSTMENTS Where a Customer has been undercharged or overcharged for metered Service, the date and cause of which can be reliably established where a customer has been undercharged or overcharged, the retroactive billing adjustment (back bill or refund) shall not exceed three years. 1. When, as a result of either a CPAU or a Customer-initiated accuracy test, an Electric or Gas Meter is found to register more than two percent (2%) fast or a Water Meter is found to register more than one and a half percent (1.5%) fast, CPAU will refund the Customer the overcharge based upon the corrected Meter readings for the period the Meter was in use, or three years, whichever is less. Any applicable late payment will be waived. 2. When, as a result of a test, a Customer’s Electric or Gas Meter is found not to register or to register more than two percent (2%) slow, or a Water Meter is found not to register or to register more than one and half percent (1.5%) slow, CPAU may bill the Customer for the undercharge base on an average bill. The bill will be computed based on an estimate of the BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 6 Customer’s consumption during a prior month in the same season or on the consumption in the same period of the prior three years. 3. When, a billing or consumption problem has been investigated and verified, Utilities will attempt to notify the Customer within 30 working days or a reasonable amount of time depending on the complexity of the error. J. UNMETERED SERVICE BILLING ERRORS AND ADJUSTMENTS Where a Customer has been undercharged or overcharged for unmetered Service, the date and cause of which can be reliably established where a customer has been undercharged or overcharged, the retroactive billing adjustment (back bill or refund) shall not exceed three years. K. THEFT OF SERVICE Where there is evidence that meter tampering or theft of Utility Service has occurred, CPAU will retroactively bill, and collect any underpayment or nonpayment of Charges as well as any labor or material costs related to investigating the theft and making any required corrections. The applicable period to assess Charges shall commence from the date it can be reasonably established the theft began to the date in which the underpayment was discovered and initially established. The labor and material costs related to investigating the theft will be calculated in accordance with Utility Rate Schedule C-1 and/or any other applicable Utility Rate schedules. All underpayments or non- payments shall become immediately due and payable. Customers committing theft of Utility Service may also be subject to legal action pursuant to Rule 1, California Penal Code sections 487,496, 498, 591, 592, 593 and California Civil Code sections 1882 through 1882.6. Customers billed for theft of service can dispute the charges by following the process described in Rule and Regulation 11.H. If that process does not resolve the matter, customers billed for theft of service may, within thirty (30) calendar days, request (by telephone, in writing, or in person) an administrative hearing. If a hearing is requested, the city manager or his designee shall schedule a date and time for said hearing as soon as possible after the request is filed, but no later than ten (10) business days after the filing of such request for hearing. At the hearing, the customer billed for theft of service may offer evidence in person or in the form of a written statement, setting forth the reasons why the customer believes the determination of theft is BILLING, ADJUSTMENTS AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-27-2016 Sheet No 7 incorrect. Utilities personnel shall also be allowed to offer whatever evidence they may have as to why they have established the customer engaged in utilities theft. The city manager or his designee shall make a determination as to whether the customer is liable for the charges for theft of service. L. WATER OR GAS LEAK CREDITS It is the Customer’s responsibility to maintain their lines and equipment in a reasonable condition such that leaks do not occur. CPAU shall not make billing adjustments for Water, Gas or Wastewater Charges resulting from leakage in a line on the Customer Premises beyond the CPAU Meter, unless CPAU determines that City staff were solely responsible for such leakage. M. REFUSE BILLING ERRORS, DISPUTES AND ADJUSTMENTS 1. Adjustments to the Refuse bill shall be requested to the City’s Collector. Customers with adjustments unresolved by the City’s Collector, may dispute their claim with the City’s Public Works Department, Refuse. Billing adjustments will be resolved by following the City’s Rules and Regulations, Chapter 5.20 of the Palo Alto Municipal Code and specific regulations promulgated by the City Manager pursuant to the authority established in Chapter 5.20. 2. When an error in billing has occurred, the date and cause of which can be reliably established where a Customer has been undercharged or overcharged, the retroactive billing adjustment shall not exceed three years. (END) BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 1 dated 9-1-99 Sheet No. 1 A. PREPARATION AND PRORATION OF BILLS: 1. Bills for utility services will be prepared on a monthly basis in accordance with the rate schedule or CPAU contract applicable to the premises served, as determined by CPAU. 2. The monthly service charge for metered water (and related wastewater), gas, and/or electric service, as well as flat-rate charges for refuse, storm drain, wastewater, and other non- metered services will be prorated if the number of actual service days is less than 25 or greater than 35. Proration will be based on the number of days in the service period to the number of days in an average month namely, 30.0. 3. Proration for all water, gas, and electric rate schedules that contain rate steps (consumption blocks) will occur when the actual days of service differ from the standard 30-day billing period. Proration is intended to produce a uniform average unit cost for the commodity regardless of the number of days in the service period. Electric demand (kW) and electric power factor rates will not be prorated. 4. In the event that water, gas (therm factor), electric, refuse, wastewater and/or storm drain rates change during the service period, charges will be prorated on the basis of the number of days covered by the previous rate schedule to the number of days covered by the new rate schedule. Mid-period proration will not occur on rate schedules that contain connection fees, deposits, and other miscellaneous fees. B. BILLING UNITS: 1. All metered billing units used for billing purposes shall be determined to the nearest whole unit. Such units may include, kW, kWh, kVa, kVar, hp, therms, and/or ccf. C. PAYMENT OF BILLS: ATTACHMENT B BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 2 dated 9-1-99 Sheet No. 2 CPAU issues bills to its customers on a monthly basis. Bills shall be deemed received upon personal delivery to Customer or three days following the deposit of the bill in the United States Mail to the Customer’s last known address. Bills for CPAU services are due and payable 20 days following issuance of the bill statement. Bills unpaid after the 20-day period are considered delinquent. If a Customer’s payment is not received by CPAU before the next bill statement is issued, the outstanding balance will be assessed a late payment charge in accordance with this rule. For the convenience of CPAU Customers’ there are a number of ways to pay CPAU bills: 1. By enclosing the bill stub and check and mailing to: CPAU, P.O. Box 10097, Palo Alto, CA 94303-0897. 2. By paying in person at the Civic Center, Revenue Collections, 1st Floor, 250 Hamilton Avenue, Palo Alto between the hours of 8:00 a.m. and 4:30 p.m. Visa and Master card payments can be processed at Revenue Collections. 3. By dropping the payment in the Night Depository Box either in the front of the Civic Center Plaza or at the drive-up Night Depository Box in the Civic Center Garage, A level. 4. By banking at a financial institution or subscribing to a service company that provides automatic payments by telephone transfer between the Customer and the bank. This involves the Customer notifying (by touch-tone telephone) the bank or service company each month of the utilities bill amount, the amount is deducted from their bank account, and the bank issues a check to CPAU. D. LATE PAYMENT CHARGES: 1. Any unpaid balance from a prior billing period is delinquent and assessed a late payment charge. Utilities charges incurred in the current billing period are due and payable by the “Due Date” indicated on the front of the bill statement. Bills unpaid by the due date are considered delinquent and a late payment charge is added to the outstanding balance. 2. Based on the particular merits of a given situation, late payment charges may be waived by CPAU. Examples of situations where a waiver is granted are generally those under which the Customer is faced with circumstances beyond his or her control. Two examples are: BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 3 dated 9-1-99 Sheet No. 3 (A) The posting of payments received by CPAU is delayed or in error. (B) The Customer is withholding payment or partial payment pending resolution of an inquiry. 3. In the event the Customer makes a payment of less than the total amount of bill rendered, which amount includes any previous balance owing, CPAU shall apply said payment first to the previous billing charges and the remainder, if any, to the current billing charges unless otherwise agreed to by CPAU. 4. In the event that a Customer participating in the ProjectPLEDGE Program has a delinquent bill, late charges will not be applied. However, the Customer’s participation in ProjectPLEDGE will be discontinued after three consecutive months in which the Customer has not included their pledge amount in the bill. 5. The late payment charge will be computed as one percent on the balance forward. 6. Subparagraphs D (1) and D (2) to the contrary notwithstanding, Customers whose CPAU bills include payments of principal and/or interest on loans from CPAU which are secured by deeds of trust on real property shall be charged a late payment charge when any current CPAU bill includes an unpaid installment on such loan from a prior bill, provided that twenty (20) days have elapsed since the day of the last billing. For closing bills, the elapsed time will be thirty (30) days. The late charge on such loan payment shall be six percent (6%) of the installment due or five dollars ($5), whichever is greater. No charge will be imposed more than once for a late payment for the same installment; provided, however, that the imposition of the late charge on any late payment will not eliminate or supersede late charges imposed on prior late payments. No late charge will be imposed on any installment which is paid or tendered in full on or before its due date, or within the ten (10) days after notice is given that the late charge will be imposed even though an earlier installment or installments, or any late charges thereon, may have been paid in full when due. For purposes of determining whether late charges may be imposed, any payment tendered by the Customer shall be applied by CPAU to the most recent installment due. Nothing in this Rule and Regulation shall be construed to alter in any way the duty of the Customer to pay any installment on a loan from CPAU when due or to alter the rights of CPAU to enforce the payment of such installments. Nothing in this subparagraph shall alter the payment or collection of late charges assessed in accordance with subparagraphs (1) and (2) of this Rule and Regulation for CPAU bills or portions thereof which do not include payments on loans secured by real property. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 4 dated 9-1-99 Sheet No. 4 7. In the event a Customer’s payment of principal and interest is past due on an unsecured loan from CPAU, the applicable late payment charge may be established in the contract with the customer. E. RETURNED CHECK CHARGE: 1. A service charge will be made and collected by the City of Palo Alto for each check returned by a bank to CPAU for the reason of insufficient funds in accordance with Rate Schedule C-1. F. DISPUTED BILLS: 1. CORRECTNESS OF BILL If the correctness of a bill is questioned or disputed by the Customer, an explanation should be requested from a Utilities Customer Service Representative within five (5) days of receiving the utility bill. If the bill is determined to be incorrect, a corrected bill will be issued to the Customer. 2. BILL REVIEW PROCEDURE (A) A Customer who has initiated a complaint or requested an investigation within five (5) days of receiving the utility bill shall be given an opportunity to review the complaint with the Supervisor, Customer Service Center. The review shall include consideration of whether the Customer should be permitted to amortize the unpaid balance of their account over a reasonable period of time. (B) After reviewing the disputed bill, the Supervisor, Customer Service Center will: (1) Authorize any necessary adjustments; or (2) Advise the Customer that the bill is correct as presented; and (3) Determine if an amortization period is warranted. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 5 dated 9-1-99 Sheet No. 5 (C) If an amortization period is warranted and agreed to by the Customer, service will not be discontinued for nonpayment provided the Customer complies with the amortization agreement, and provided the current bill is paid within 20 days of the date issued. (D) If the Customer fails to comply with the amortization agreement, service shall be subject to discontinuance for nonpayment of bills as provided in Rule 14. (E) Failure of the Customer to notify CPAU of a billing error or to request an explanation of charges within 20 days of the date of the bill will constitute acceptance by the Customer of the bill as rendered. 3. PAYMENT OF BILLS IN DISPUTE If a Customer disputes a specific utility charge on a utilities bill covering multiple utilities, the bill amount for utility services which are not in dispute shall be due and payable by the date due on the bill statement. The Customer is not obligated to pay the utility charge in dispute while CPAU is investigating the disputed charges. Upon completion of the investigation, CPAU will notify the Customer if and when a payment is required. G. BILLING ADJUSTMENTS: Under certain circumstances, CPAU will adjust a Customer’s bill to correct for billing error or for reasons of equity and fairness. Such adjustments are generally of a one-time nature. Billing error is the incorrect billing of an account due to an error by CPAU or the Customer, which results in incorrect charges to the Customer. Some billing errors also arise if the Customer provides incorrect information to CPAU. Billing adjustments applied to Customer charges for reasons of equity and fairness include water or gas leak credits, smoothing, and in cases where excessive consumption of water, gas, and/or electricity occurred and where Customers rented debris boxes as a result of the Customer’s reasonable efforts to mitigate or remedy property damage or loss caused by an event of force majeure. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 6 dated 9-1-99 Sheet No. 6 Billing errors include, but are not limited to, incorrect meter reads or meter read estimates, clerical errors, wrong therm factors, wrong meter multiplier, incorrect voltage discount, meter installation, crossed meters, undercharges due to meter tampering, an inapplicable rate, an oversight in the process of entering the appropriate meter information into the computer system for billing, or field errors such as installing the meter or regulator incorrectly. 1. SMOOTHING ADJUSTMENT (A) A smoothing adjustment averages the usage of a customer over two billing periods. The Supervisor, Customer Service Center or a designated representative shall determine if a smoothing adjustment is indicated. (B) A smoothing adjustment may be appropriate if consumption between two billing cycles changes to an extraordinary high level and is caused by the following. (1) An estimated meter reading by CPAU; or (2) A longer or irregular billing cycle. 2. METER ERRORS AND OTHER BILLING ADJUSTMENTS (A) When, as a result of a test, a meter is found to be more than two percent (2%) fast, CPAU will refund the Customer the overcharge based upon the corrected meter readings for the period the meter was in use. (B) When, as a result of a test, a meter in residential use is found not to register, or to register more than ten percent (10%) slow, CPAU may bill the Customer for the undercharge based on an average bill. The bill will be computed upon an estimate of consumption based upon the Customer’s prior use. (C) When, as a result of a test, a meter in other than residential use is found not to register, or to register more than two percent (2%) slow, CPAU may bill the Customer for the undercharge base on an average bill. The bill will be computed upon an estimate of consumption based upon the Customer’s prior use during the same season of the year. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 7 dated 9-1-99 Sheet No. 7 3. APPLICABLE ADJUSTMENT PERIOD FOR METER ERRORS, RETROACTIVE BILLING, AND REFUNDS (A) When it is found that a meter is recording in error or an error in billing has occurred, the date and cause of which can be reliably established, the retroactive billing adjustment will apply as follows: (1) Where the Customer has been undercharged, the period to be backbilled shall not exceed 6 months; (2) Where the Customer has been overcharged the period to be refunded shall not exceed 12 months; (B) Where there is evidence that theft of energy or water has occurred, CPAU shall retroactively bill and collect any underpayment or nonpayment of charges. The applicable period to assess charges shall commence from the date it can be reasonably established the theft began to the date in which the underpayment was discovered and initially established. The applicable period shall not exceed 4 years. 4. WATER OR GAS LEAK CREDITS: Billing adjustments may be made for water or gas lost as a result of leakage in a line on the Customer premises beyond the CPAU meter. Leaking faucets, toilets, hoses, or sprinklers do not qualify for a billing credit unless a determination has been made by CPAU that the Customer had no control of such device(s) leaking. Under no circumstances will a billing credit be provided a Customer when the facts indicate that a Customer had knowledge of a water or gas leak, but failed to take corrective measures in a timely manner. It is the Customer’s responsibility to maintain their lines and equipment in a reasonable condition such that leaks do not occur. (A) Generally, a leakage credit will be granted for a one month billing cycle. However, depending on the circumstances, a two-month billing cycle may be granted by the Supervisor, Customer Service Center. Such circumstances include, but are not limited to, a leak occurring while a Customer is out of town for an extended period of time. Leak credits will not be provided beyond a two-month billing cycle. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 8 dated 9-1-99 Sheet No. 8 (B) All Customer classes are eligible for the leak credit. To qualify for the water leak credit, evidence of having repaired the leak is required. Such evidence may consist of a plumber’s repair bill, materials receipt, or field verification by CPAU. Customers who are negligent or slow to react in repairing a leak do not qualify for a leak credit. (C) To arrive at the corrected bill amount, which reflects the leak credit, CPAU will estimate what would have been the normal consumption and calculate a normal bill based on that consumption. Then, actual consumption in excess of the normal figure will be billed at CPAU’s current wholesale commodity cost plus ten percent. The sum of these two calculations represents a revised billing amount. The leak credit is the difference between the revised billing amount and the original bill. 5. BILLING ADJUSTMENTS IN CONNECTION WITH FORCE MAJEURE EVENTS (A) For purposes of this Rule and Regulation, the term “force majeure” means the occurrence of an event that is beyond the reasonable control of the utility Customer and, which by reasonable efforts, the Customer could not prevent. Such events include, but are not limited to, an Act of God, an irresistible, superhuman cause, fire, flood, earthquake, or any other similar cause. (B) Water, Gas, and/or Electric (1) A water, gas, and/or electric billing adjustment in connection with a force majeure event shall be limited to charges for water, gas, and/or electricity consumption in excess of the historical average for the customer. The billing adjustment will be applied as a credit on the customer’s bill. The credit is for the amount of excess usage and represents the difference between the amount charged for the applicable period and an amount calculated based on the customer’s average consumption for a similar period. This credit shall include a refund of any applicable utilities users tax that was based on the amount of excess usage. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-1-2005 Supercedes Sheet No. 9 dated 11-22-1999 Sheet No. 9 (2) The Director of Utilities shall determine the historical average consumption. Depending on the availability of data and other reasonable considerations, the basis for calculating such averages may be the same month(s) in a previous year, a recent 12 month average, a 6 month seasonal average for winter or summer, or other appropriate period(s) as determined by the Director of Utilities. (C) Debris Boxes (1) A billing adjustment or refund in connection with debris boxes serviced by the City’s contracted Collector shall be limited to City’s Collector charges incurred or to be incurred out-of-pocket by the resident, owner, or business for removal of flood-damaged materials only. Refunds will not be applied to charges paid through insurance policies. The City’s Collector will keep a record of those residences and businesses that request debris boxes during the applicable refund period. (D) To qualify for an adjustment under this section, the Customer may be required to provide documentation to verify damage to the residence or building, or contents thereof. In circumstances in which the City has previously verified such damage such as by a field visit or has made a determination from other information resources, documentation from the Customer may not be required. However, to qualify for a refund for debris box rentals, a signed statement by the Customer is required that attests that the debris box was used for flood-damaged materials only and that the Customer has not and will not be reimbursed by homeowners insurance or any other agency. 6. REFUSE BILLING DISPUTES AND ADJUSTMENTS (A) Adjustments to the refuse bill shall be requested to the City’s collector. Customers with adjustments unresolved by the City’s collector, may dispute their claim with the City’s Public Works Department. Billing adjustments will be resolved by following the City’s Rules and Regulations and specific regulations established in Chapter 5.20 of the Palo Alto Municipal Code. (B) When an error in billing has occurred, the date and cause of which can be reliably established, the retroactive billing adjustment will apply as follows: BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-1-2005 Supercedes Sheet No. 10 dated 11-22-99 Sheet No. 10 (1) Where the Customer has been undercharged, the period to be back billed shall not exceed 6 months; (2) Where the Customer has been overcharged, the period to be refunded shall not exceed 12 months; (C) Customers requesting refuse collection services to be suspended or requesting for a service credit to be issued shall obtain from the City a non-occupancy status. Refuse bill shall be adjusted accordingly. H. BUDGET BILLING PAYMENT PLAN: A Budget Billing Payment Plan establishes equalized monthly payments and is available to all residential Customers who qualify as set forth below. 1. Customers may join the Budget Billing Payment Plan at any time prior to July 1, the beginning of the annual budget payment cycle, providing however, the Customer account balance is zero, and the Customer has not been removed from the budget plan for non- payment within the previous six months. 2. A Customer electing to utilize the plan shall agree to make monthly payments based on CPAU’s estimate of the Customer charges for the twelve-month period July 1 through the next June 30, reflecting anticipated rate changes. 3. CPAU does not guarantee that the total actual charges will not exceed or be less than its estimate. CPAU will review the account on a periodic basis and may revise its estimate in response to changing rates or variations in the amount of service used. CPAU may require that Customers pay a revised monthly amount as a condition to continuing participation in the plan. 4. DISCONTINUANCE OF BUDGET BILLING: The Budget Billing Payment Plan shall remain in effect from year to year, subject to review of the monthly payment amount, and shall terminate when: (A) The customer notifies CPAU to terminate participation in the plan; (B) CPAU notifies the customer of the termination of its budget payment plan: (C) The Customer no longer takes service at the premises; or BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 11 dated 9-1-99 Sheet No. 11 (D) The Customer owes an amount of two or more monthly payments. However, if the customer eliminates the delinquency, removal from the plan will not occur. (E) The Customer participates in Direct Access and buys from another Energy Service Provider. Upon termination of either CPAU service or participation in the budget payment plan, any amount owned by the Customer for actual charges shall immediately become due and any amount due the Customer shall be refunded as soon as possible. I. RESALE PROHIBITED: 1. Customer shall use services only for the purposes specified in the service agreement and applicable rate schedule(s). CPAU service shall not be resold except as provided in this rule. 2. Premises that are receiving service in conflict with this Rule as of the effective date of this Rule may continue to receive service under such conditions if so authorized in writing by CPAU. 3. Sub-metering shall be considered sufficient evidence that utilities are being resold, with the exception of provision I-4 below. 4. Property owners may bill the cost of providing utilities to individual tenants separately from rent only with written consent of the Assistant Director of Utilities, Administrative Services. Charges for utilities may be allocated based upon metering, square footage, or another methodology determined to be reasonable by CPAU. Under no circumstances can the total costs of CPAU services allocated to tenants exceed the costs of CPAU services billed to the property owner by CPAU. A property owner using a billing procedure coming within the scope of this Rule must disclose all information used to determine a tenant’s utilities bill to the tenant or CPAU, or both, upon request. Property owners are responsible for resolving utility bill disputes with their tenants. Tenants may request and receive from CPAU a copy of previous bills for a period not to exceed 12 months, charged to the property owner who sub-meters. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 12 dated 9-1-99 Sheet No. 12 J. ACCOUNTING, BILLING, AND PAYMENT FOR GAS SERVICE PROVIDERS 1. INFORMATION CHARGES CPAU shall charge, and the Gas Service Provider shall pay, for any non-confidential or non- proprietary information requested by the Gas Service Provider pertaining to the Eligible Customer which is in addition to information normally provided in accordance with CPAU’s procedures. 2. BILLING All billings between the Gas Service Provider and CPAU for services under a Gas Service Provider Agreement shall be performed by CPAU or the Pool Manager on a calendar month basis. (A) All billing statements shall reflect the period from 7:00 a.m. PST on the first Day of each calendar month until 7:00 a.m. PST hours on the first Day of the following calendar month; provided, however, the billing statements for any partial first month and partial last month of service shall be prorated by the number of Gas Days of service during such month. (B) Bills sent to the Gas Service Provider shall be sent to the appropriate billing address specified in the Gas Service Provider Agreement. (C) Payments for amounts billed to the Gas Service Provider shall be due on the last Day of the month in which the billing statement is issued or the fifteenth (15th) Day after receipt of the billing statement, whichever is later. Payments for amounts owed by CPAU to the Gas Service Provider shall be applied as a credit to the Gas Service Provider’s bill within the time in which the Gas Service Provider is required to pay CPAU’s bills. If, as a result of the credit, the Gas Service Provider is owed money, CPAU shall make payment in accordance with this Rule. Payment shall be made at the offices designated in The Gas Service Provider Agreement, or by electronic funds transfer to accounts specified in The Gas Service Provider Agreement. (D) Amounts not paid on or before the due date shall be payable with interest accrued at the rate of one percent (1%) per month, or the maximum interest rate permitted by Law, whichever is less, prorated by Days from the due date to the date of payment. BILLING, ADJUSTMENTS, AND PAYMENT OF BILLS RULE AND REGULATION 11 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 11-22-1999 Supercedes Sheet No. 13 dated 9-1-99 Sheet No. 13 When payments are mailed to CPAU, the billing statements shall be deemed paid on the dates of receipt by CPAU. (E) If the Gas Service Provider disputes the accuracy of any portion of the billing statement, then the Gas Service Provider shall pay the undisputed portion within the time required herein. Upon a determination that any disputed amount should be paid by the Gas Service Provider, the Gas Service Provider shall pay such amount, plus accrued interest, at the rate established in this Rule. (F) CPAU shall adjust a billing statement as deemed reasonably necessary by the Utilities Director for any billing statement error that is established. All adjustments or billing statement errors shall be resolved promptly as practicable, and, upon resolution, shall be included in the billing statement for the next regular Billing Period. 3. RECORDS CPAU and the Gas Service Provider shall keep accounting records and books for two (2) years in accordance with generally accepted accounting principles and practices in the industry. CPAU and the Gas Service Provider shall have the right to examine those books and the accounting records of the other during that two-year (2-year) period. Any examination will be at the examining Party’s expense, must be conducted at a reasonable time, and must be confined to the extent necessary to verify the accuracy of any statement, charge, or computation or any demand made under or as a result of transporting Customer-owned Gas. {End}