H-1929

AN ACT Relating to low-income energy assistance; amending RCW 70.164.010, 70.164.020, and 70.164.030; adding new sections to chapter 70.164 RCW; adding a new section to chapter 43.63A RCW; adding a new section to chapter 80.01 RCW; and adding a new section to chapter 43.21F RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 70.164.010 and 1987 c 36 s 1 are each amended to read as follows:

(1) The legislature finds and declares:

(a) The health, welfare, and prosperity of the people of the state of Washington require that all citizens receive essential levels of heat and electric service regardless of economic circumstance;

(b) That weatherization of the residences of low-income households will help conserve energy resources in this state and can reduce the need to obtain energy from more costly conventional energy resources((~~. The legislature also finds~~));

(c) That rising energy costs have had a negative effect on the affordability of housing for low-income citizens and have made it difficult for low-income citizens of the state to afford adequate fuel for residential space heat((.));

(d) Declining federal low-income energy assistance funding and limited oil overcharge funds require a state response to ensure the continuity and further development of energy assistance, energy conservation, and related policies within the state of Washington;

(e) Weatherization of residences will lower energy consumption, making space heat more affordable for persons in low-income households((~~. It~~)), and will ((~~also~~)) reduce the uncollectible accounts of fuel suppliers resulting from low-income customers not being able to pay fuel bills;

(f) That the best time to make energy conservation improvements to existing residential dwellings is during rehabilitation; and

(g) That energy conservation is an important component of housing affordability.

(2) The legislature declares that it is the policy of the state:

(a) To establish a comprehensive, low-income energy assistance policy and program that incorporates income assistance, energy conservation, and other measures to ensure that citizens have access to affordable energy services;

(b) That energy conservation improvements through the retrofit of existing residential dwellings shall be coordinated with rehabilitation activities funded with state resources or resources administered through the state;

(3) The program implementing the policy of this chapter is necessary to support the poor and infirm and also to benefit the health, safety, and general welfare of all citizens of the state.

Sec. 2. RCW 70.164.020 and 1987 c 36 s 2 are each amended to read as follows:

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Department" means the department of community development.

(2) "Energy assessment" means an analysis of a dwelling unit to determine the need for cost-effective energy conservation measures as determined by the department.

(3) "Energy supplier" means an electric utility or natural gas utility, whether privately or publicly owned, a heating oil dealer, or a propane dealer that receives ten thousand dollars or more from sales.

(4) "Fuel oil dealer" means a person who supplies fuel oil at retail for space heating of dwellings.

(5) "Gross operating revenue" means gross receipts from sales or service made or provided within this state during the regular course of the energy supplier's business, but does not include revenue derived from interutility sales within the state.

(6) "Household" means an individual or group of individuals living in a dwelling unit as defined by the department.

((~~(4)~~)) (7) "Low income" means household income that is at or below one hundred twenty-five percent of the federally established poverty level.

((~~(5)~~)) (8) "Nonutility sponsor" means any sponsor other than a public service company, municipality, public utility district, mutual or cooperative, furnishing gas or electricity used to heat low-income residences.

((~~(6)~~)) (9) "Propane dealer" means a person who supplies liquefied petroleum gas at retail for space heating of dwellings.

(10) "Residence" means a dwelling unit as defined by the department.

((~~(7)~~)) (11) "Sponsor" means any entity that submits a proposal under RCW 70.164.040, including but not limited to any local community action agency, community service agency, or any other participating agency or any public service company, municipality, public utility district, mutual or cooperative, or any combination of such entities that jointly submit((s)) a proposal.

((~~(8)~~)) (12) "Sponsor match" means the share, if any, of the cost of weatherization to be paid by the sponsor.

((~~(9)~~)) (13) "Weatherization" means materials or measures, and their installation, that are used to improve the thermal efficiency of a residence.

((~~(10)~~)) (14) "Weatherizing agency" means any approved department grantee or any public service company, municipality, public utility district, mutual or cooperative, or other entity that bears the responsibility for ensuring the performance of weatherization of residences under this chapter and has been approved by the department.

Sec. 3. RCW 70.164.030 and 1987 c 36 s 3 are each amended to read as follows:

(1) The low-income weatherization assistance account is created in the state treasury. All moneys from the money distributed to the state pursuant to Exxon v. United States, 561 F.Supp. 816 (1983), affirmed 773 F.2d 1240 (1985), or any other oil overcharge settlements or judgments distributed by the federal government, that are allocated to the low-income weatherization assistance account shall be deposited in the account. The department may accept such gifts, grants, and endowments from public or private sources as may be made from time to time, in trust or otherwise, and shall deposit such funds in the account. Any moneys received from sponsor match payments and funds received under section 10 of this act shall be deposited in the account. The legislature may also appropriate moneys to the account. Moneys in the account shall be spent pursuant to appropriation and only for the purposes and in the manner provided in RCW 70.164.040 and sections 4 through 10 of this act. Any moneys appropriated that are not spent by the department shall return to the account.

(2) Notwithstanding RCW 43.84.090, all earnings of investments of balances in the low-income weatherization assistance account shall be credited to the account.

NEW SECTION. Sec. 4. The department shall prepare a state plan for the low-income energy assistance and energy conservation programs to ensure the availability and affordability of heating and electric service to low-income citizens. The state plan shall:

(1) Ensure that low-income households, regardless of the primary energy source used for home heating, will receive energy assistance and energy conservation;

(2) Establish uniform eligibility, verification, and documentation requirements for the low-income energy assistance and energy conservation program offered by the state;

(3) Require all energy suppliers to offer an energy conservation and energy assistance program to all qualified customers;

(4) Require demonstration of the performance or of the installation of no-cost or low-cost energy conservation measures, state measures, energy conserving practices and other appropriate program requirements during energy audits;

(5) Establish such registration, certification, training, and inspection programs with respect to energy auditors, suppliers, installers, lenders, and inspectors participating in the state plan as may be necessary or desirable for the public health, safety, and welfare;

(6) Establish and review goals for delivery of energy audits and other program requirements to customers;

(7) Require all home heating energy suppliers to work, either individually or cooperatively, with local community action agencies to publicize the availability of low-income energy assistance and energy conservation programs;

(8) Establish a public advisory committee described in section 9 of this act; and

(9) Coordinate the Washington low-income energy assistance and energy conservation programs.

NEW SECTION. Sec. 5. (1) The department shall establish a low-income energy assistance program to ensure the availability and affordability of heating and electric services to low-income households.

(2) The energy assistance program established by the department shall contain the following elements:

(a) The customer shall pay a reduced rate for his or her home heating and electric services. The goal of the program is that only six percent of the customer's annual household income be used for home heating and electric services;

(b) The customer shall not be required to pay utility deposits; and

(3) An energy supplier may apply to the department for authorization to offer an energy assistance program which differs from the program established by the department but which substantially meets the standards in subsection (2) of this section. A utility-sponsored energy assistance program may include a percentage-of-income payment plan, provide for discounted rates, or include other plans approved by the department.

(4) The department shall adopt rules for the program not later than one hundred eighty days after the effective date of this section. The rules shall be developed in consultation with the advisory committee established by section 9 of this act.

(5) The department, to the maximum extent permitted under federal law, shall use funds made available to the state under the low-income heating energy assistance program for the state program and any equivalent programs approved by the department pursuant to subsection (3) of this section.

NEW SECTION. Sec. 6. (1) The department shall establish the low-income energy conservation program. To the extent practicable, the program shall provide for targeting use of both state and federal weatherization and energy conservation funds to the households of eligible applicants whose ratios of energy costs to income are the highest prior to any reduction in rates being applied. The program shall also provide that low-income households are served in relatively the same proportion as the heating sources used by the low-income households in the state. The program shall include, but need not be limited to, the following:

(a) A description of the demographic characteristics and energy use patterns of people eligible for assistance pursuant to this chapter;

(b) The methodology used by the department in targeting energy conservation funds;

(c) A description of anticipated activity and results for the year covered by the program, including an estimate of energy cost savings expected to be realized by the energy conservation program; and

(d) An evaluation of results from the energy conservation program in the year preceding the program year, including the effect of state energy conservation program investments on energy consumption and cost in the population eligible for assistance pursuant to this chapter, and the effect of targeted energy conservation investments on the costs of the energy assistance program established pursuant to section 5 of this act.

(2) Allowable expenditures under the energy conservation program include, but are not limited to, the following:

(a) Insulation;

(b) Windows;

(d) Caulking;

(e) Doors; and

(f) Labor.

(3) The low-income energy conservation program shall be developed in consultation with the low-income energy assistance advisory committee established pursuant to section 9 of this act.

NEW SECTION. Sec. 7. The energy conservation program established pursuant to section 6 of this act shall provide for the replacing of wood stoves as provided in this section. If the low-income household is located in a nonattainment area for ambient air quality, or in an area for which an air authority has prohibited the installation of wood stoves in new construction, the program shall require the wood stove to be replaced by the most cost-efficient source of home heating other than wood or coal. If the household is located in an attainment area and an air authority has not prohibited the installation of wood stoves in new construction, a certified wood stove shall be installed.

NEW SECTION. Sec. 8. The department shall develop model energy education programs to be provided as a part of the low-income energy assistance and energy conservation programs. The model energy education programs shall include, but are not limited to, necessary instruction and demonstration of energy conservation measures and money management techniques that the household can adopt to effectively use and preserve energy resources. The model energy education programs shall also provide written educational materials, instructional aids, and follow-up procedures.

NEW SECTION. Sec. 9. (1) The department shall establish the low-income energy assistance advisory committee to be comprised of:

(a) The secretary of social and health services, the directors of community development and the state energy office, and the chair of the utilities and transportation commission, or their designees, who shall serve as ex-officio, nonvoting members of the advisory committee;

(b) Fourteen persons appointed by the director of community development to serve two-year terms and until their successors are appointed and qualified. Three shall be persons who represent low-income households or organizations which represent low-income households; seven shall be representatives of energy suppliers: One from the natural gas industry, one from the investor-owned electric industry, one from the publicly owned electric industry, one from the municipal electric industry, one from the oil heat industry, one from the liquefied petroleum gas industry, and one representing the Washington wood heat association; two shall be representatives from local agencies which contract with the department to provide energy assistance or energy conservation services; and two shall represent owners of low-income rental property, one representing owners of single-family or multifamily units, and one representing owners of mobile home rental units. The chairperson shall be elected from the voting members of the advisory committee.

(2) The energy assistance advisory committee shall have the following duties:

(a) To monitor the administration of this chapter to ensure effective, efficient, and coordinated program development and administration;

(b) To assist the department in developing and administering rules required to be adopted under this chapter in a manner consistent with the purpose and objectives of this chapter;

(c) To facilitate and coordinate the collection and exchange of all program data and other information needed by the department and others in fulfilling their duties pursuant to this chapter;

(d) To advise the department on the proper level of support required for effective administration of this chapter;

(e) To review and comment on any energy assistance, energy conservation, or related plan developed by the department or any energy supplier pursuant to this chapter; and

(f) To prepare and submit not later than December 1 of each year to the appropriate standing committees of the senate and the house of representatives a report which describes the activities of the department in development and implementation of energy assistance and related policies and programs, which characterizes progress towards meeting the objectives and requirements of this chapter, and which recommends any statutory changes which might be needed to further such progress.

NEW SECTION. Sec. 10. In addition to any other fees required by law, each energy supplier shall pay to the department of revenue, for deposit in the low-income weatherization assistance account, its share of an assessment to fund the low-income energy assistance program established by this chapter. The total assessment shall not exceed twenty million dollars per biennium and shall be determined in the following manner:

(1) Upon approval of the department's biennial budget by the legislature in each odd-numbered year, the department shall promptly enter an order establishing the amount of revenues required to be derived from an assessment pursuant to this section in order to fund the low-income energy assistance and energy conservation program for the first fiscal year of the biennium at the level approved by the legislature. Upon approval of a supplemental budget by the legislature, the department shall enter an order for assessments for the second fiscal year of the biennium to take into account any revisions to the level authorized by the legislature. The order shall allocate the aggregate assessment to energy suppliers in accordance with subsection (2) of this section.

(2) The amount assessed to an energy supplier shall be based on the ratio that the supplier's annual gross operating revenue derived within this state in the preceding calendar year bears to the total gross operating revenue derived within this state during the previous calendar year by all energy suppliers. The department shall exempt from payment of an assessment any individual energy supplier whose calculated share of the annual assessment is less than two hundred fifty dollars.

(3) The department shall send a copy of each order issued to each energy supplier subject to assessment pursuant to this section.

(4) An energy supplier providing energy conservation and energy assistance programs that meet the goals of the state energy conservation and energy assistance program in an alternative manner approved by the department may be eligible for credits against the assessment imposed under this section. To establish eligibility for the credit, a utility shall file with the department on or before November 1 of each year a request for approval of credits based on the utility's activities during the prior fiscal year. The department shall make a determination of the amount of credit for each applicant not later than April 1 of each year. The department shall authorize credits equal to expenditures from the energy supplier's own funds on a program approved by the department.

(5) The amounts assessed to individual energy suppliers pursuant to this section shall be paid to the department on a pro-rated quarterly basis starting not later than ninety days after the date the governor signs the biennial budget.

(6) An energy supplier shall provide the department, on or before May 1 of each year, a verified statement showing its gross operating revenues derived within the state for the preceding calendar year. The statement shall be in a form prescribed by the department and is subject to audit by the department.

(7) Funds collected pursuant to this section, minus three percent for administrative costs of the department of community development, shall be deposited in the low-income weatherization assistance account.

(8) This section shall expire July 1, 2001.

NEW SECTION. Sec. 11. A new section is added to chapter 43.63A RCW to read as follows:

The department shall require applicants requesting assistance to rehabilitate either single-family or multifamily residential dwellings to coordinate available energy conservation assistance with rehabilitation activities funded through the Washington housing trust fund under chapter 43.185 RCW and the community development block grant program for states and small cities under the Title I housing and community development act of 1974 (42 U.S.C. 5301 et seq.).

NEW SECTION. Sec. 12. A new section is added to chapter 80.01 RCW to read as follows:

The commission shall allow a company to offer discounted rates to low-income individuals.

NEW SECTION. Sec. 13. A new section is added to chapter 43.21F RCW to read as follows:

The office, in consultation with the department of community development, shall prepare proposals to sell low-income conservation to utilities.

NEW SECTION. Sec. 14. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 15. Sections 4 through 10 of this act are each added to chapter 70.164 RCW.