Valley Rural Electric Cooperative, Inc

RE: ID # [redacted]
Dear Ms. [redacted]:
Thank you for your letter of October 21 regarding a complaint from a consumer of Valley Rural Electric Cooperative, Inc.
The consumer in question signed up for electric service on July 30, 2014, A $25 account processing...

fee and $200 security deposit were charged to his account. These amounts (along with $0.70 for one day’s energy use) appeared on the consumer’s bill which was processed on July 31 and mailed thereafter.
Any applicant for membership who is unable to establish credit worthiness to the cooperative’s satisfaction is required to pay a security deposit. A consumer typically must pay the account processing fee on the day of application and has seven days to forward the deposit amount or the account is subject to disconnection. In this case, an error was made and the account was not processed for disconnection when the fee and deposit were not received as required.
On August 21, the consumer’s account was charged a penalty of $3.39 for non-payment of the balance by the due date (August 20). On August 31, the account was charged $28.07 for energy use; the bill (totaling $257.16) was processed and mailed thereafter.
A payment of $100 was received on September 22, bringing the balance to $157.16. That same day, one of our employees spoke to the consumer to explain that he had until October 14 to pay the balance and avoid disconnection. On September 23, the account was charged a penalty of $2.36 for non-payment of the balance by the due date (September 20). On September 30, the account was charged $31.55 for energy use; the bill (totaling $191.07) was processed and mailed thereafter.
On October 14, one of our employees called the consumer to remind him that payment was due or the account would be disconnected. He requested that we wait until Thursday, October 16 because he would get paid that day. The employee agreed to give him until 11 a.m, on Thursday, October 16 to pay the balance or the account would be disconnected.
On Monday, October 20, an employee attempted to reach the consumer by phone and left a voicemail message asking about payment of the account balance and requesting a return call. Later, when the employee spoke with the consumer, she explained that he must pay $191.07 or the service would be disconnected and that he had received extra time (more than two months) to pay the deposit.
Later that day, a payment of $ 110 was received, leaving a balance of $81.07. The consumer then called in and said he didn’t have the money to pay the balance. He asked to speak to a manager and requested that his deposit be used to pay the balance on the account. The supervisor explained that the consumer had paid a total of only $210, which did not cover the deposit and account processing fee (let alone the energy use). She also explained that the deposit cannot be used as an individual savings fund when payments are behind. According to cooperative policy, a deposit can only be applied to an outstanding balance on a final bill (when a consumer is moving out of a property and disconnecting the service).
The consumer then asked to speak to the department head, who reiterated that the account should have been subject to disconnection in August. She explained that the deposit is not held on individual accounts to draw from in case of delinquency but is an amount that protects other rate-payers from bearing the cost of past due balances. The department head encouraged the consumer to contact family, friends or help agencies for assistance; the consumer replied that he didn’t believe in asking for help from organizations or churches. The consumer stated that he would not have any money to pay the bill until November 16 when he would receive his disability check. He said he planned to clean out his freezer before we disconnected the account the next day.
Approximately one hour later, a payment of $90 was received, leaving a credit of $8.93 on the account. No further communication had been received regarding the account until receipt of your letter.
Please let me know if you require further details about this account or about cooperative policies regarding security deposits or disconnection of service.
Cooperatively yours,
[redacted] Vice President
Consumer Services and Public Relations

Review: valley rural is charging a security deposit on all new account which goes in as liquid monies and upon the deposit being made becomes lost for no use to the customers by definition it's money laundering which is a federal crime as per their own rules set fourth these deposits are to be used in a situation where payments are not made to that account so that the cooperative isn't liable for outstanding bills which is completely understandable however myself faced with disconnection my deposit would not be used for the said purpose instead a new connect and disconnect fee would be added to the outstanding balance I understand the deposit whole heartedly however it's not being used in this matter is baffling to me I made a deposit that would have then if used paid all fees and brought my account three dollar's to the good if their so called deposit was usedDesired Settlement: I want my two hundred doallar deposit to become liquid to my account and all others that have been hampered by this same scam and want the policy rewritten or amended to have the use of the deposits become liquid monies in all accounts thank you for attention to this matter this is my first step in this matter I send this for consultation if I am not pleased with their answer to this matter I intend to take it to next level and so on until a resolution is meet

Business

Response:

RE: ID # [redacted]

Dear Ms. [redacted]:

Thank you for your letter of October 21 regarding a complaint from a consumer of Valley Rural Electric Cooperative, Inc.

The consumer in question signed up for electric service on July 30, 2014, A $25 account processing fee and $200 security deposit were charged to his account. These amounts (along with $0.70 for one day’s energy use) appeared on the consumer’s bill which was processed on July 31 and mailed thereafter.

Any applicant for membership who is unable to establish credit worthiness to the cooperative’s satisfaction is required to pay a security deposit. A consumer typically must pay the account processing fee on the day of application and has seven days to forward the deposit amount or the account is subject to disconnection. In this case, an error was made and the account was not processed for disconnection when the fee and deposit were not received as required.

On August 21, the consumer’s account was charged a penalty of $3.39 for non-payment of the balance by the due date (August 20). On August 31, the account was charged $28.07 for energy use; the bill (totaling $257.16) was processed and mailed thereafter.

A payment of $100 was received on September 22, bringing the balance to $157.16. That same day, one of our employees spoke to the consumer to explain that he had until October 14 to pay the balance and avoid disconnection. On September 23, the account was charged a penalty of $2.36 for non-payment of the balance by the due date (September 20). On September 30, the account was charged $31.55 for energy use; the bill (totaling $191.07) was processed and mailed thereafter.

On October 14, one of our employees called the consumer to remind him that payment was due or the account would be disconnected. He requested that we wait until Thursday, October 16 because he would get paid that day. The employee agreed to give him until 11 a.m, on Thursday, October 16 to pay the balance or the account would be disconnected.

On Monday, October 20, an employee attempted to reach the consumer by phone and left a voicemail message asking about payment of the account balance and requesting a return call. Later, when the employee spoke with the consumer, she explained that he must pay $191.07 or the service would be disconnected and that he had received extra time (more than two months) to pay the deposit.

Later that day, a payment of $ 110 was received, leaving a balance of $81.07. The consumer then called in and said he didn’t have the money to pay the balance. He asked to speak to a manager and requested that his deposit be used to pay the balance on the account. The supervisor explained that the consumer had paid a total of only $210, which did not cover the deposit and account processing fee (let alone the energy use). She also explained that the deposit cannot be used as an individual savings fund when payments are behind. According to cooperative policy, a deposit can only be applied to an outstanding balance on a final bill (when a consumer is moving out of a property and disconnecting the service).

The consumer then asked to speak to the department head, who reiterated that the account should have been subject to disconnection in August. She explained that the deposit is not held on individual accounts to draw from in case of delinquency but is an amount that protects other rate-payers from bearing the cost of past due balances. The department head encouraged the consumer to contact family, friends or help agencies for assistance; the consumer replied that he didn’t believe in asking for help from organizations or churches. The consumer stated that he would not have any money to pay the bill until November 16 when he would receive his disability check. He said he planned to clean out his freezer before we disconnected the account the next day.

Approximately one hour later, a payment of $90 was received, leaving a credit of $8.93 on the account. No further communication had been received regarding the account until receipt of your letter.

Please let me know if you require further details about this account or about cooperative policies regarding security deposits or disconnection of service.

Cooperatively yours,

[redacted] Vice President

Consumer Services and Public Relations