Local Finance Notice 2022-11 Treatment of Residential Water, Sewer & Electric Arrerages; Residential Ratepayer Assistance
- The moratorium on shutoffs and enforcement of liens on unpaid water, sewer, and electric charges by residential customers expired on March 15th, 2022.
- P.L. 2021, c. 317 and P.L. 2022, c. 4 establish relief measures for residential customers of local government water, sewer, and electric service. These laws apply to municipalities, local authorities, and other local units that directly bill customers.
Delay in Enforcing Unpaid Charges Pending Application for Utility Assistance
- Before shutting off or enforcing a lien against a residential customer, a local unit must wait 60 days to see if the customer has submitted an application for a State-administrated program.
- If a residential customer appeals a state agency’s denial of a utility assistance program application, local units are prohibited from enforcing a lien.
- The Division strongly recommends that local units refrain from shutting off water, sewer, and electric service to residential customers until after June 15th. This extended moratorium on shutoffs does not apply to a shutoff required to address a condition constituting a potential danger to life, health, or property.
- The Low Income Household Water Assistance Program (LIHWAP) assists low-income households that have arrears for drinking water and/or sewer services. It provides a benefit of up to $1,500 per household.
- The state agency that administers the utility assistance program must approve or reject a residential customer’s application within 90 days of receiving the application, and must notify each local government or utility of the decision made on the application. If a residential customer has appealed a state agency’s denial of a utility assistance program application, a municipality or local authority shall further delay enforcing a lien for the unpaid balance of water, sewer, or electric charges.
Calculation of Interest on Unpaid Charges; Late Fees and Penalties
- Local units cannot collect interest, fees or charges for unpaid water, sewer, and electric balances between March 9, 2020 and March 15, 2022.
- A local unit cannot collect interest, fees, or charges for late or untimely payment of sewer balances, because the public health emergency only applied to unpaid water and electric charges.
Installment Plans for Water, Sewer, & Electric Arrears
- Before enforcing unpaid open water, sewer, or electric charges accruing prior to March 15, 2022, a local unit must offer a residential ratepayer the opportunity to enter into an installment plan for satisfying the unpaid balance of charges.
- Delinquent sewer charges accruing between March 9, 2020 and December 31, 2021 were not affected by P.L. 2021, c. 317.
- The 12-month mandatory installment plan must have a minimum 12-month duration, unless the residential customer requests a shorter payback period, and cannot require the residential customer to pay a down payment, deposit, reconnection costs, or interest or penalties on the unpaid balance.
- If a residential ratepayer does not pay their arrearages and/or current charges within 30 days after the due date, the installment plan is void and enforcement can proceed at any time, including service shutoff and bringing accrued arrears to tax sale.
- The Division encourages regular monitoring of all installment plans, including monthly reporting, and requires that discretionary judgments concerning installment plans be memorialized in writing.
Local Finance Notice 2022-11
Please follow the link below to read more about these items and guidance on how your local unit can implement them: https://www.nj.gov/dca/divisions/dlgs/lfns/22/2022-11.pdf
Contact Wielkotz & Company, LLC Today
For further information on Local Finance Notice 2022-11 and its implementation feel free to reach out to Steven Wielkotz at (973)-835-7900 ext. 201 or email@example.com.