SUN Testimony At PSC Hearing On National Grid Rate Hike

Syracuse United Neighbors (SUN) is a neighborhood organization whose members are residents of low income neighborhoods on the south, southwest and near west sides of the city of Syracuse, N.Y. For over 30 years, SUN has fought to improve our neighborhoods and helped residents with issues such as safe and affordable housing, reducing street crime and maintaining quality city services.

National Grid is requesting an increase in the rates they may charge for gas delivery. In the support documents the utility submitted in this case, the company projects an increase of revenue per customer of 27% between what they received in 2007 and what they will receive in 2010. In return, they propose a limited discount of $5/month for low income customers. Even with this discount, the increase customers will see is 22%.

The end result of these increases will be unbearable for the poorest of New Yorkers, as incomes for low income families are only increasing by 1% a year. The result will be an even poorer community, as families juggle heat, housing, food, medicine and health care bills–all of which are increasing rapidly. SUN sees more and more people in our neighborhoods that cannot afford the basic necessities of life–forced to make decisions about cutting back on medicines, not paying their mortgage, eating less or paying their heat bill.

National Grid has a history of abusive relations with customers and should not be rewarded with any increase at all. National Grid, in this filing, announces to the world that it intends to increase the number of field/collection/shutoff visits by 19% in the next two years. It is clear that National Grid is using the threat of shutoffs as a bill collection measure–in direct violation of the spirit of the Home Energy Fair Practices Act (HEFPA) New York utility consumers’ “bill of rights.” Passed in 1981, HEFPA sets the goal for utilities of continual service to customers, working to prevent shut offs.

Instead, National Grid bumps customers off budget plans and its Affordability program for seniors after one missed payment, immediately presenting bills for two to three thousand dollars, the balance of the year’s payments. National Grid uses the drama of threatened and actual shut offs as a means to compel payment. They are no better than the loan shark that busts kneecaps.

National Grid’s local customer service is swamped with calls and heaven forbid the one consumer advocate for the several county area around Syracuse is out sick or at a meeting. The only alternative for customers is to call the utility’s 1-800 number where the negotiation is always the same–pay your bill in full or we will cut you off.

The Public Service Commission is asleep at the switch on these customer abuse issues, but vigilant and proactive when dealing with the financial well-being of the the utilities.

We request the PSC to do the following:

1) Deny the rate increase to National Grid.

2) Require National Grid to offer its upstate NY customers the same sort of low income discount it offers to its customers in metropolitan Boston–an annual discount of 26%. Or perhaps extend the same sort of innovative case management and arrearage forgiveness program (On Track) it continues to run for its former Key Span customers in Brooklyn, parts of Long Island and Massachusetts.

3) Create a financial incentive program for utilities when they reduce the incidences of shut offs to customers, similar to the program that rewards utilities for reducing lost utility service due to mechanical failures. Something like this is required in a state that has seen incomes plummet, prices skyrocket and the Associated Press is reporting that utility shut offs statewide have increased by 17% this year.

SUN Testimony Before Governor’s Economic Security Cabinet

SUN attended the town hall meeting held in Syracuse on June 26th by Governor David Patterson’s Economic Security cabinet. The group is made up of the heads of 20 state agencies and they are charged with developing ways the state can help low income families survive in these tough economic times.

SUN wanted to focus attention on the problems low income neighborhoods in Syracuse are facing with skyrocketing home energy costs. Here is the statement we read at the meeting:

SUN is a grassroots neighborhood organization whose members are residents of the the south, southwest and near-west side neighborhoods of Syracuse. 500 families are dues-paying members of SUN and the organization has been in existence since 1978–fighting to improve our community, working on the issues of safe and affordable housing, crimne-free streets, bank redlining, quality city/county services and environmental justice.

SUN’s neighborhoods consist of 10 census tracts on the south and near-west sides of the city. According to the 2000 Census, 24,809 residents live in 8,625 households in these neighborhoods. 10,725 people in SUN’s neighborhoods live below the federal poverty line. This is 44% of the population whose income was determined–this compares to a poverty rate for the income determined population of 12% in Onondaga County and 27 % for the city of Syracuse. The median incomes for our 10 census tracts range from $8,974 to $22,515 with an average median income of $16,607 ( The median incomes for the county is $40,847 and for the city is $25,000).

Only 31% of the households in SUN’s target area are owner-occupied. The city has a owner-occupancy rate of 40% and the county’s rate is 64%.

SUN’s target area is 61% African-American, 26% white and 13% other minorities. 13% of the area’s residents consider themselves to be Hispanic or Latino. 41% of the city’s African-American population and 40% of the city’s Hispanic residents live within SUN’s target area.

Beyond all the statistics are our neighbors. Many are struggling to make ends meet. Unemployment, underemployment and small fixed incomes for disabilities and retirement make lifre difficult for many folks in our neighborhoods. In a report prepared by the Fiscal Policy Institute for your committee, it was revealed that 30% of working families in New York do not have enough income to cover the basics of life: food, shelter and energy.

Our neighborhoods reflect this reality. When people are juggling what little income they have to keep a roof over their head and food on the table, things that more affluent families consider basics are just not possible: home repairs, savings accounts, a computer for children’s schoolwork.

SUN is here today to ask the Economic Security cabinet to focus on what we believe is the single most pressing financial problem for families in our neighborhoods–the skyrocketing cost of home utilities–electricity and heat.

New York has the nation’s third highest utility bills, behind only Alaska and California. Syracuse, the nation’s snowiest metropolitan city, faces severe winter weather and families are struggling to keep up with their heat bills. Our neighborhood’s housing stock largely consists of large, wood-frame houses, many over 100 years old. Since only 31% of the neighborhood owns their own home, many families are unable to make repairs that would reduce their heat bills, even if they could find the money to finance the necessary work. We have entered a time where families heat bills in the winter months regularly exceed the payments made on either rent or mortgages.

Our office fields dozens of calls a week from families desperate to avoid utility shut offs or make arrangements to pay delinquent bills. Many families have told stories of being without power for extended periods of time, heating their homes with gas stoves.

SUN has several suggestions to deal with this growing crisis in our neighborhoods:

1. Create low-income utility rates for electricity and natural gas. According to a 2004 study by the Public Utility Law Project, creating a separate schedule of rates for low income families would cut costs to utilities and communities by reducing: the number of shut offs and reconnections, the number of uncollectible accounts, the costs to cities for fire and emergency services and to government for Medicaid and homeless shelters.

2. Expand and improve low income energy efficiency programs. The state’s Weatherization Assistance Program has a two year waiting list in Onondaga County. More money for the program could be found by adopting the Assembly’s bill 11590 for a windfall recovery tax on oil companies or committing profits generated by the state’s proposed participation in the Regional Greenhouse Gas Initiative cap and trade program.

3. Vigorously enforce the Home Energy Fair Practices Act. The state policy of continuous service without unreasonable qualification should create a climate where a utility shutoff is a rare occurrence.

4. Establish incentives for utilities to reduce service interruption. To help reach the goal of rare shut offs, utilities should be rewarded for finding creative ways to keep a customer’s power on, rather than being forced to use shut offs as a collection tool.

5. More state investment in safe and affordable housing–construction and rehabilitation. Homes built new for low income families (and homes rehabilitated for low income families) will be more energy efficient and reduce the overall use of energy. The state should increase the commitment to funding housing programs under DHCR and HFA, AFC and SONYMA. In addition, the state should work with groups like the Empire State Housing Alliance to wok toward creating a true state Housing Trust Fund, with annually dedicated funds from a stable source of income.

A Victory Over National Grid (Greed)!

As SUN wrote earlier, National Grid was abusing state regulations that protect low income rate payers by requiring a $1,000 deposit for families attempting to re-establish electricity after a break in service. National Grid called this the “Grand Plan.” Often, customers were forced to use HEAP benefits to pay back bills, rather than reduce current winter heat costs.

Well, thanks to an appeal to the Public Service Commission by the Public Utility Law Project (PULP), the “Grand Plan” requirement has been eliminated.

Three Syracuse families referred by SUN became part of the complaint filed by PULP to the Public Service Commission on behalf of 18 families that had been hurt by the “Grand Plan” rules. Now, families can turn on their power without being required to put down an exorbitant amount of money. They may be required to enter into a payment agreement to pay off their arrears, but those agreements are covered by the protections for low income customers provided by the state’s Home Energy Fair Practices Act (HEFPA).

SUN Fights National Greed . . . AGAIN!

SUN is working with the Public Utility Law Project (PULP) of Albany to overturn the National Grid policy for restoring power to customers with outstanding debt. After a break in service, the utility refuses to restore power to customers until the past-due bill is paid. This policy requires anyone with a back bill of over $1,000 to pay at least one grand before power can be turned on in their name. The utility refuses to negotiate or establish repayment plans. The international energy conglomerate refers to this policy as “The Grand Plan.”

PULP argues that this policy violates Public Service Commission regulations and is a form of double dipping, since National Grid’s rates are set to compensate the utility for uncollected payments. It is outrageous that this wealthy multinational corporation is sending families to local welfare offices and governmental subsidy programs to help collect money that the utility has been compensated for by its current ratepayers.

It is even more outrageous that National Grid allows families to suffer without heat and lights, refusing to even negotiate affordable repayment plans. Too many families in our community are either trying to survive without heat and electricity or are one step away from losing their service. The cost of heating oil and natural gas are predicted to increase significantly this winter.

SUN has helped one area family submit a complaint through PULP to the PSC. The family, a single working mother with two asthmatic children, had their power turned on after living with no utilities for over a month. They were not required to pay $1,000 up front. Just this morning SUN helped another family write up their protest and PULP submitted the paperwork to the Public Service Commission this afternoon.

If you are a family that is attempting to open energy service in your name and are being denied until you pay up front for an old, unpaid bill: call SUN at 476-7475 and we may be able to help.