Utility Legislation Hits a Snag : Senate Panel Delays Action on Central Credit Checks

Times Staff Writer

A bill by Assemblyman Willard H. Murray (D-Paramount) to let gas and electric utilities join a centralized credit bureau to track down delinquent customers stalled this week after Sen. John Garamendi (D-Walnut Grove) assailed the proposal as "a major invasion of individual privacy."

In response to Garamendi's objections, the Senate Energy and Public Utilities Committee on Monday delayed action on the measure until the Legislature returns to the Capitol after its four-week summer recess, which begins on Friday.

Murray's bill has two key provisions. One is designed to ensure that a decision by a public utility to require a security deposit is based only upon the credit history of the customer and not a relative or roommate.

The second part--which prompted criticism from Garamendi--would require the California Public Utilities Commission to authorize gas and electric utilities to participate in a centralized credit check system established in 1985 for the state's seven largest telephone companies.

The goal of Murray's proposal--according to an analysis of the bill by the Senate Energy and Public Utilities Committee--is to help utilities locate customers who have failed to pay bills and moved to another part of the state.

Edison Co. Supports It

Tommy Ross, a lobbyist for Southern California Edison Co., said his utility already shares credit information with other electric utilities--a program that last year resulted in Edison collecting $665,000 in unpaid bills. He said Murray's measure, which Edison supports, would allow the electric utilities to swap similar information with telephone companies and other utilities.

In an interview Tuesday, Murray said his original aim was to abolish the requirement for utility security deposits, which sometimes pose a hardship, especially to poor people. Supporters say that some utilities have sought deposits from new residential customers based upon the belief that a previous tenant, who failed to pay his bill, may have been a roommate of the new customer.

Murray said that as a trade-off to remove opposition from utilities, the bill went beyond spelling out conditions for obtaining a security deposit to provide utilities "with access to central credit information."

But in an interview Tuesday, Garamendi questioned the value of the trade-off because, "on balance the consumers aren't going to be better off."

During Monday's committee hearing, Garamendi criticized the legislation, saying: "Mr. Murray, not to pick on you and your bill, but you're doing far more than just dealing with security deposits . . . and in my view it is a major invasion of individual privacy."

Garamendi labeled the bill "a bad one, a real bad one" because "we're really going to hurt people . . . ." He also scolded Murray for "really putting Big Brother in place in a big, big way, with no consumer protection."

Murray said that he did not face similar criticism when the bill was in the Assembly, which approved the measure last month on a 70-1 vote. He brushed aside the objections, maintaining that the bill includes consumer protections because it prohibits public utilities from releasing, transferring or selling credit information or using it for marketing programs.

Murray also said the intent of the bill is not to set up a new credit check system, but merely to utilize the system used by telephone companies. Currently, phone companies exchange information to determine whether, for example, a customer who has skipped out on a bill is seeking telephone service somewhere else in the state, according to PUC officials.

Ross, the Edison lobbyist, said that the measure could help utilities lower costs if they could more easily locate customers who failed to pay their bills. If the legislation becomes law, he said, it would assure that "rate-payers don't have to subsidize people not paying bills."

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