Laws of New York State
Reference: New York State Legislature
Last Update: Feb 22, 2015

§36 - Residential service deposits

Cite: N.Y. P.B.S. Law § 36 (Consol.).


1. On and after January first, nineteen hundred eighty-two, no utility corporation or municipality shall require any new residential customer, other than a seasonal or short term customer, to post a security deposit as a condition of receiving utility service. In addition, no utility corporation or municipality shall after the first day of September, nineteen hundred eighty-two, or such earlier date as the commission may determine, require a current residential customer to post a security deposit other than such a customer who is delinquent according to standards set by the commission. Deposits held on the first day of September, nineteen hundred eighty-two, or such earlier date as the commission may determine, shall be returned to the customer immediately, but not later than the next bill for service; provided, however, that this provision shall not apply to deposits of delinquent customers. No utility corporation or municipality shall require any known recipient of public assistance, supplemental security income benefits or additional state payments to post a security deposit as a condition of receiving service.

2. Notwithstanding the provisions of subdivision one of this section, the commission, after investigation and hearing, may authorize any utility corporation or municipality to require and hold security deposits from residential customers or applicants for service upon a finding that the collection and maintenance of such deposits is cost effective to the utility as a whole without regard to cash flow and the availability of capital.

3. In any case where customer deposits are authorized by this section, a utility corporation or municipality may require a customer or applicant for service to deposit a reasonable sum of money according to the estimated quantity of such services necessary to supply the customer or applicant for service for two months, to secure payment for such services actually rendered, or for the rental of fixtures, instruments and facilities actually supplied. Every such utility corporation and municipality shall allow to every such customer or applicant for service interest on the sum deposited at a rate per annum to be prescribed from time to time and at least annually by the commission in light of current economic conditions and current charges paid for moneys borrowed by such utility, taking into account the expenses incurred by such utility in obtaining, handling, returning or crediting the sum deposited. Such interest shall be paid upon the return of the deposit, provided however, that whenever such deposit has been held for a period of one year, the interest shall be credited to the customer or applicant for service on the first billing for utility service rendered after the end of such period. If a customer or applicant for service is not delinquent in the payment of any billing during such one year period, the deposit shall be refunded promptly at the end thereof, without prejudice to the utility's or municipality's right to require a deposit thereafter in the event of a delinquency. All utility corporations and municipalities shall exempt from deposit requirements any customer or applicant for service who is sixty-two years of age or older, unless the customer or applicant for service is a bad credit risk according to standards set by the commission.

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