Relating to late payment fees charged by a municipally owned water utility.
If enacted, HB2787 would create a new regulatory environment for how municipally owned water utilities can charge late fees. By setting a clear limit on fees, the bill aims to provide relief to customers who may struggle to pay their water bills on time. This change could potentially protect lower-income residents from harsh penalties while ensuring that the utilities still have a framework for penalty revenue. The provisions regarding appeals to the utility commission also introduce a level of oversight and accountability for municipalities that would be charged with determining the compliance of their fees.
House Bill 2787 is proposed legislation concerning the late payment fees that municipally owned water utilities can impose on their customers. The bill amends the Texas Water Code by establishing a framework for late payment fees, specifically limiting the charge to either a flat fee of $5 or a percentage (2%) of the overdue amount, capped at $500. This aims to prevent excessive punitive charges that might unfairly affect customers who experience temporary financial hardships. It mandates that customers can appeal fees that do not comply with the established criteria to the utility commission.
The sentiment around HB2787 appears to be supportive among consumer advocates and groups who emphasize the need for fair treatment of customers of municipal utilities. However, there was opposition from certain municipal representatives and utility associations concerned about the loss of local control in setting fees and potential revenue shortfalls for these entities. The discussion surrounding the bill reflects a broader tension between consumer protection and the financial health of municipal utilities.
Notable contention arises from the balance between protecting consumers and allowing municipalities the flexibility to manage their revenue streams. Some critics argue that capping late fees may limit a municipality's ability to respond to financial losses incurred from delayed payments, potentially leading to operational challenges. The debate touches on the fundamental principles of local governance versus state-imposed regulations, as municipalities may be better positioned to understand their unique financial needs and customer circumstances. Overall, the bill represents a significant shift in the regulatory landscape for water utilities in Texas.