Contact: Jack Hawks; jhawks@cwacontent.local; (415) 561-9650 (o), (415) 305-4393 (c)

SACRAMENTO – Representatives from the California Water Association (CWA), which represents regulated water utilities throughout California, and California American Water testified today before the California Assembly Utilities & Commerce Committee in support of Assembly Member Cristina Garcia’s Assembly Bill 1180. The bill passed the Utilities & Commerce Committee on a 14-0 vote and will next be heard in the Assembly Appropriations Committee on January 20.

AB 1180 would direct the California Public Utilities Commission (CPUC) to evaluate the potential for repealing a transaction fee levied on customers who pay their water utility bill by credit or debit card. Public Utilities Code §755 requires this transaction fee unless and until the CPUC determines that the use of credit and debit cards would result in no net cost to the utility.

“Paying recurring bills online with a credit or debit card has become much more popular with customers in recent years,” said CWA Executive Director Jack Hawks. “It’s not fair to penalize them by adding a $2 to $3 charge per transaction when the costs of other forms of payment, such as writing a check or paying in person, are spread across the entire customer base and recovered through rates.”

This transaction fee applies only to regulated utilities and is not the case for government utilities or state agencies, such as the Department of Motor Vehicles, and has become a significant source of complaint when customers are confronted with this additional charge.

“Current law treats the payment of regulated utility bills differently than virtually all other retail transactions by requiring customers to be charged a transaction fee for paying with a credit card,” said California American Water’s Manager of External Affairs Evan Jacobs. “In a different era, this may have made sense. Today, however, customers expect to be able to pay online and by credit card as a matter of convenience.”

AB 1180 would create a pilot program that would allow a participating water utility to waive the transaction fee for customers paying by credit or debit card, and to collect information from customers in order to assist the CPUC with evaluating whether it is necessary to treat credit and debit card payments differently than other forms of payment.

The bill would allow CPUC to consider factors other than cost when evaluating the efficacy of the transaction fee, such as convenience, practicality, and avoidance of late fees.

California Water Association

The California Water Association represents 108 regulated water utilities in California.  Its members provide safe, reliable, high-quality water service to approximately 6 million Californians.

California American Water

California American Water, a subsidiary of American Water (NYSE: AWK), provides high quality and reliable water and/or wastewater service to approximately 600,000 people.

Photo credit: California Department of Water Resources

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