BILL ANALYSIS SB 1163 Page 1 Date of Hearing: June 9, 2004 ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT Alan Lowenthal, Chair SB 1163 (Dunn) - As Amended: May 27, 2004 SENATE VOTE : 23-13 SUBJECT : Mobilehome park: utilities. SUMMARY : This bill makes changes to the utility statements provided by the management of a mobilehome park to residents and requires the consumer affairs branch of the California Public Utilities Commission to accept and respond to complaints made by submetered customers in mobilehome parks or apartment complexes. Specifically, this bill : 1)Requires management to provide residents who receive master meter and submeter utility services a bill for electricity and gas services which identifies all rates and quantities attributable to each block in the attributable rate structure as if the resident were receiving services directly from the utility company. 2)Requires management to disclose the name, address, and the telephone number of a third-party billing agent or company that prepares the utility billing for the park on each billing statement. EXISTING LAW 1)Requires master meter customers to provide the opening and closing readings for submetered mobilehome park customers each billing period. (Civil Code Section 798.38) 2)Requires management to post the residential utilities rate schedule as published by the utility company. (Civil Code Section 798. 38) 3)Establishes requirements regarding the rates charged by master meter customers to submetered tenants, specifies the general form and content of the bills rendered by the master meter customer, and makes it a duty of mater-meter customers to maintain and repair the facilities between the master meter and the submetered tenant. SB 1163 Page 2 (Public Utilities Code Section 739.5) FISCAL EFFECT : Unknown. COMMENTS : Background: There are approximately 4,850 mobilehome parks and manufactured communities in California, which house more than 600,000 people. Each mobilehome space consists of a utility pedestal for electric and gas as well as sewer and water hookups. In most parks utility service is provided by the park owner to individual mobilehome spaces through a "master meter" system, with a public utility providing gas, electricity and sometimes water to the park master meter but not to individual spaces. The park operator maintains the park utility system, reads the submeters where applicable, and bills the residents. Many parks hire third party billing companies or agents to perform these functions. Master meter parks receive a "differential" or discount on residential rates from the utility in recognition of their costs of operating and maintaining the submeter system but charge residents at the same rate the serving public utility would charge if it served the residents directly. The differential is negotiated between the parks and the serving utility and approved by the California Public Utilities Commission (CPUC). The majority of statutory requirements governing master meter utility systems in mobilehome parks are located in the Public Utilities Codes; although, there are some duplicate provisions in the Civil Code, the Mobilehome Residency Law (MRL). The Senate Select Committee on Mobile and Manufactured Housing has received a number of complaints from residents of mobilehome parks regarding their master meter service over the last few years regarding the utility billing practices of the management. The committee held a hearing in 2001 during which residents offered numerous complaints including questions as to the accuracy of park's utility billings and meter readings, the inability to speak to third party billing companies regarding a resident's statement, and CPUC's lack of response to individual complaints from residents. Clarifying the role of CPUC: According to the author, there is some disagreement as to CPUC's authority to address resident complaints regarding their master meter utility service. CPUC representatives who have been SB 1163 Page 3 contacted by the author regarding complaints contend CPUC does not have authority to oversee master meter billing practices or take complaints from residents or to require parks to adhere to, billing practices required by the code. CPUC representatives say they can only require the serving utility to request the parks to comply with the code. In an effort to clarify and strengthen the role of CPUC in dealing with complaints from residents of master meter residential communities, this bill specifically states the consumer affairs branch of the agency will accept and respond to these complaints from residents regarding violations of master meter requirements. Billing Statements : MRL governs interactions between mobilehome park management and residents and also includes a provision relating to master meter requirements that closely parallels Public Utilities Code (PUC). In order to clarify the MRL this bill adds language from the PUC that requires the form and content of bills provided to residents by the park match that provided by the utility to the master meter mobilehome park. This language already exists in the PUC but the author has received complaints from residents that it is not being followed by some mobilehome parks. By moving the language to the MRL the author seeks to ensure enforcement. Third-Party Billing : Many mobilehome parks hire third party billing companies to read meters and bill residents. But, when residents have questions about their bills, they do not have access to the billing company. According to the author, the management cannot address the questions because they do not issue the bill and management generally will not provide the billing companies contact information so the resident can speak with them directly. This bill requires that if park management uses a third party billing company they must provide the contact information of that company on each bill the resident receives. Opposition: The opposition argues moving the provision of the PUC code regarding billing statements to the MRL will place the mobilehome park owners and managers at greater civil liability and will result in more lawsuits. Mobilehome park owners are SB 1163 Page 4 subject to a $2,000 fine for violating the provisions of the MRL. The opposition argues if owners do not comply with the billing requirements added to the MRL they will be subject to civil liability. However, the provisions added to the MRL do not specify requirements as to the accuracy of the bill-this provision remains in the PUC. If residents believed the park management did not follow the new provisions added to the MRL, they would have to prove the park intentionally misread the meter. To do so the resident would have to have collateral proof such as photographs with a time-date-stamp indicating the meter reading. According to the author, park residents who are often low income or seniors, have difficulty suing a park unless they are involved in a class action suit. Court cases are costly and it is difficult to get an attorney to take an individual resident's case, which has the potential for limited returns. The opposition also contends including the section of PUC, which defines the billing requirements in the MRL, is unnecessary, because CPUC already enforces the requirement. The author's office contends duplicating the language in the MRL will remove confusion and provide uniformity in applying existing requirements. Double Referred : The Assembly Committee on Rules referred SB 1163 to Housing and Community Development Committee and Utilities and Commerce Committee. If SB 1163 passes this committee, the bill must be referred to the Assembly Committee on Utilities and Commerce. REGISTERED SUPPORT / OPPOSITION : Support California Mobilehome Resource and Action Association Golden State Manufactured-Home Owners League Opposition California Mobilehome Parkowners Alliance Western Manufactured Housing Communities Association Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085 SB 1163 Page 5