# Applications for Service, Customer Deposits, and Third-Party Guarantee Arrangements

- **operation:** document
- **citation:** 4 CCR 723-4 Rule 4403
- **title:** Applications for Service, Customer Deposits, and Third-Party Guarantee Arrangements
- **source type:** regulation
- **agency:** Colorado Public Utilities Commission
- **status:** current
- **official:** true
- **published on:** Not available
- **effective on:** Not available
- **summary:** (a) A utility shall process an application for utility service that is made either orally or in writing and shall apply nondiscriminatory criteria with respect to the requirement of a deposit prior to commencement of service. Nondiscriminatory criteria means that no deposit or guarantee, or addition
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- **app url:** https://regulus.evalyn.ai/document/co-ccr-4-723-4-4403
- **source url:** https://www.sos.state.co.us/CCR/DisplayRule.do?action=ruleinfo&ruleId=2260&deptID=18&agencyID=96&deptName=Department%20of%20Regulatory%20Agencies&agencyName=Public%20Utilities%20Commission&seriesNum=4%20CCR%20723-4
**body:**

(a) A utility shall process an application for utility service that is made either orally or
in writing and shall apply nondiscriminatory criteria with respect to the
requirement of a deposit prior to commencement of service. Nondiscriminatory
criteria means that no deposit or guarantee, or additional deposit or guarantee,
shall be required by a utility because of race, sex, creed, national origin, marital
status, age, number of dependents, source of income, disability, or geographical
area of residence.
(b) All utilities requiring deposits shall offer customers at least one payment
alternative that does not require the use of the customer’s social security
number.
(c) If billing records are available for a customer who has received past service from
the utility, the utility shall not require that person to make new or additional
deposits to guarantee payment of current bills unless the records indicate recent
or substantial delinquencies.
(d) A utility shall not require a deposit from an applicant for service who provides
written documentation of a 12 consecutive month good payment history from the
utility from which that person received similar service. For purposes of this
paragraph, the 12 consecutive months must have ended no earlier than 60 days
prior to the date of the application for service.
(e) A utility shall not require a deposit from an applicant for service or restoration of
service who is or was within the last 12 months, a participant in the Low-Income
Energy Assistance Program or in an income qualified program consistent with
rule 4412, or who received energy bill assistance from Energy Outreach
Colorado within the last 12 months.
(f) If a utility uses credit scoring to determine whether to require a deposit from an
applicant for service or a customer, the utility shall have a tariff that describes, for
each scoring model that it uses, the credit scoring evaluation criteria and the
credit score limit that triggers a deposit requirement.
(g) If a utility uses credit scoring, prior payment history with the utility, or customer-
provided prior payment history with a like utility as a criterion for establishing the
need for a deposit, the utility shall include in its tariff the specific evaluation
criteria that trigger the need for a deposit.

(h) If a utility denies an application for service or requires a deposit as a condition of
providing service, the utility immediately shall inform the applicant for service of
the decision and shall provide, within three business days, a written explanation
to the applicant for service stating the specific reasons why the application for
service has been denied or a deposit is required.
(i) No utility shall require any surety other than either a deposit to secure payment
for utility services or a third-party guarantee of payment in lieu of a deposit. In no
event shall the furnishing of utility services or extension of utility facilities, or any
indebtedness in connection therewith, result in a lien, mortgage, or other interest
in any real or personal property of the customer unless such indebtedness has
been reduced to a judgment. Should the guarantor terminate service or terminate
the third party guarantee before the customer has established a satisfactory
payment record for 12 consecutive months, the utility, applying the criteria
contained in its tariffs, may require a deposit or a new third party guarantor.
(j) The total deposit a utility may require or hold at any one time shall not exceed an
amount equal to an estimated 90 days' bill of the customer, except in the case of
a customer whose bills are payable in advance of service, in which case the
deposit shall not exceed an estimated 60 days' bill of the customer. The deposit
may be in addition to any advance, contribution in aid of construction or
guarantee required by the utility tariff in connection with construction of lines or
facilities, as provided in the extension policy in the utility's tariffs. A deposit may
be paid in installments.
(k) A utility receiving deposits shall maintain records showing:
(I) the name of each customer making a deposit;
(II) the amount and date of the deposit;
(III) each transaction, such as the payment of interest or interest credited,
concerning the deposit;
(IV) each premise where the customer receives service from the utility while
the deposit is retained by the utility;
(V) if the deposit was returned to the customer, the date on which the deposit
was returned to the customer; and
(VI) if the unclaimed deposit was paid to the energy assistance organization,
the date on which the deposit was paid to the energy assistance
organization.
(l) Each utility shall state in its tariff its customer deposit policy for establishing or
maintaining service. The tariff shall state the circumstances under which a
deposit will be required and the circumstances under which it will be returned. A

utility shall return any deposit paid by a customer who has made no more than
two late payments in 12 consecutive months.
(m) Each utility shall issue a receipt to every customer from whom a deposit is
received. No utility shall refuse to return a deposit or any balance to which a
customer may be entitled solely on the basis that the customer is unable to
produce a receipt.
(n) The payment of a deposit shall not relieve any customer from the obligation to
pay current bills as they become due. A utility is not required to apply any deposit
to any indebtedness of the customer to the utility, except for utility services due
or past due after service is terminated.
(o) A utility shall pay simple interest on a deposit at the percentage rate per annum
as calculated by the Commission staff and in the manner provided in this
paragraph.
(I) At the request of the customer, the interest shall be paid to the customer
either on the return of the deposit or annually. The simple interest on a
deposit shall be earned from the date the deposit is received by the utility
to the date the customer is paid. At the option of the utility, interest
payments may be paid directly to the customer or credited to the
customer's account.
(II) The simple interest to be paid on a deposit during any calendar year shall
be at a rate equal to the average for the period October 1 through
September 30 (of the immediately preceding year) of the 12 monthly
average rates of interest expressed in percent per annum, as quoted for
one-year United States Treasury constant maturities, as published on the
website or publication of the Board of Governors of the Federal Reserve
System. Each year, the Commission staff shall compute the interest rate
to be paid. If the difference between the existing customer deposit interest
rate and the newly calculated customer deposit interest rate is less than
25 basis points, the existing customer deposit interest rate shall continue
for the next calendar year. If the difference between the existing customer
deposit interest rate and the newly calculated customer deposit interest
rate is 25 basis points or more, the newly calculated customer deposit
interest rate shall be used. The Commission shall send a letter to each
utility stating the rate of interest to be paid on deposits during the next
calendar year. Annually following receipt of Commission staff’s letter, if
necessary, a utility shall file by advice letter or application, as appropriate,
a revised tariff, effective the first day of January of the following year, or on
an alternative date set by the Commission, containing the new rate of
interest to be paid upon customers’ deposits, except when there is no
change in the rate of interest to be paid on such deposits.

(p) A utility shall have tariffs concerning third-party guarantee arrangements and,
pursuant to those tariffs, shall offer the option of a third party guarantee
arrangement for use in lieu of a deposit. The following shall apply to third-party
guarantee arrangements:
(I) an applicant for service or a customer may elect to use a third-party
guarantor in lieu of paying a deposit;
(II) the third-party guarantee form, signed by both the third-party guarantor
and the applicant for service or the customer, shall be provided to the
utility;
(III) the utility may refuse to accept a third-party guarantee if the guarantor is
not a customer in good standing at the time of the presentation of the
guarantee to the utility;
(IV) the amount guaranteed shall not exceed the amount which the applicant
for service or the customer would have been required to provide as a
deposit;
(V) the guarantee shall remain in effect until the earlier of the following occurs:
(A) the guarantee is terminated in writing by the guarantor;
(B) if the guarantor was a customer at the time of undertaking the
guarantee, the guarantor ceases to be a customer of the utility; or
(C) the customer has established a satisfactory payment record, as
defined in the utility's tariffs, for 12 consecutive months.
(VI) Should the guarantor terminate service or terminate the third party
guarantee before the customer has established a satisfactory payment
record for 12 consecutive months, the utility, applying the criteria
contained in its tariffs, may require a deposit or a new third party
guarantor.

(q) A utility shall pay all unclaimed monies, as defined in § 40-8.5-103(5), C.R.S.,
that remain unclaimed for more than two years to the energy assistance
organization. “Unclaimed monies” shall not include: undistributed refunds for
overcharges subject to other statutory provisions and rules and credits to existing
customers from cost adjustment mechanisms.
(I) Monies shall be deemed unclaimed and presumed abandoned when left
with the utility for more than two years after termination of the services for
which the deposit or the construction advance was made or when left with
the utility for more than two years after the deposit or the construction
advance becomes payable to the customer pursuant to a final
Commission order establishing the terms and conditions for the return of
such deposit or advance and the utility has made reasonable efforts to
locate the customer.
(II) Interest on a deposit shall accrue at the rate established pursuant to
paragraph (o) of this rule commencing on the date on which the utility
receives the deposit and ending on the date on which the deposit is paid
to the energy assistance organization. If the utility does not pay the
unclaimed deposit to the energy assistance organization within four
months of the date on which the unclaimed deposition is deemed to be
unclaimed or abandoned pursuant to subparagraph (q)(I) of this rule, then
at the conclusion of the four-month period, interest shall accrue on the
unclaimed deposit at the rate established pursuant to paragraph (o) of this
rule plus six percent.
(III) If payable under the utility’s line extension tariff provisions, interest on a
construction advance shall accrue at the rate established pursuant to
paragraph (o) of this rule commencing on the date on which the
construction advance is deemed to be owed to the customer pursuant to
the utility’s extension policy and ending on the date on which the
construction advance is paid to the energy assistance organization. If the
utility does not pay the unclaimed construction advance to the energy
assistance organization within four months of the date on which the
unclaimed construction advance is deemed to be unclaimed or abandoned
pursuant to subparagraph (q)(I) of this rule, then at the conclusion of the
four-month period, interest shall accrue on the unclaimed construction
advance at the rate established pursuant to paragraph (o) of this rule plus
six percent.
(r) A utility shall resolve all inquiries regarding a customer’s unclaimed monies and
shall not refer such inquiries to the energy assistance organization.
(s) If a utility has paid unclaimed monies to the energy assistance organization, a
customer later makes an inquiry claiming those monies, and the utility resolves
the inquiry by paying those monies to the customer, the utility may deduct the

amount paid to the customer from future funds submitted to the energy
assistance organization.
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