| On April 22, 2004, Governor Granholm signed the House version of SB612 into law (Public Act 88 of 2004). The original bill would have exempted Consumers’ Appliance Service Plan from the “Code of Conduct” and would have authorized the utilities to use incremental (as opposed to fully allocated) accounting. The MAFC provided the House the ammunition to see these disastrous provisions eliminated in the final compromise bill.
Portions of the Bill were favorable to contractors in that it formalized some important protections from the Code of Conduct by putting them in statute. This is important as the Code of Conduct continues to be attacked in the courts (see main story). Under PA88:
· A utility must separate all management personnel responsible for the appliance service plan (ASP) into a separate department of the utility.
· A utility may not use monthly utility bill mailings to promote their ASP.
· A utility must make available to other companies offering an ASP a list of all regulated customers of the utility upon request within two business days. New customers must be |
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added to the list within one business day.
· A utility must inform any new ASP customer that appliance service plans are available from other providers, that the program is not regulated by the PSC; that a customer has 10 days to cancel the program without penalty.
· All advertising must contain a disclaimer that the program is not regulated by the Public Service Commission.
Where Consumers was successful was in persuading legislators to let it continue to use utility employees and vehicles to do the appliance service work. They must, however, properly account for all expenses incurred, including separate books and records for the program, with access to those books and records by the Public Service Commission.
This makes the job of preventing cross-subsidization much harder without the operations separate. This means that the role that the Public Service Commission will play in policing the utilities is crucial. The MAFC is working with the Commission to establish guidelines to make certain that abuse does not occur. |