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SBC Billing Practice to Change

by H.W. Moss
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SBC, the local telephone operating company for millions of Californians, has been telling customers with balances below $20 they must pay by a certain day or face a late penalty. Charging such a fee is a clear violation of a tariff that became effective Nov. 1, 1999.

A late payment charge of 1.5 percent, calculated monthly, applies only to an unpaid balance of $20.00 or more, according to spokespeople at both SBC and the California Public Utilities Commission which oversees the tariffs under which public utilities operate.

"I think they're making a mistake," said Norman Low, Program Projects Supervisor with the CPUC. "For sure a late payment charge does not apply until $20 or more." Low said he wants SBC "to take it (the late penalty) off."

An SBC spokesperson agreed and said bills will reflect this change in August. However, SBC does not believe any of their customers paid the late fee. Even if they did, the penalty would show up as a credit on the next bill.

"I don't think consumers were wronged at all," said John Britton, SBC director of corporate communications. "If someone looking at this, probably most likely would have paid the amount they owed. If someone did inadvertently send us a higher amount which would have been no more than 30 cents, 30 cents would have showed as a credit on the next bill."

Bills with the incorrect amount on the bottom have been sent to customers since April when the company began sending out its newly redesigned invoices. At that time the company also dropped the phrase "Pacific Bell Monthly Charges" from the statement. SBC acquired Pacific Bell in 1997, but not until April did the bill reflect the brand name change.

According to the PUC, if a utility does not do what their tariff says the utility is supposed to do, if they do something which violates their tariff, that could trigger a complaint which could require the company to issue refunds and it could result in penalties.

All SBC bills carry a warning which states that if payment is not received on or before a certain date, the customer is to pay a higher amount. At 1.5% monthly, that is 18% per annum. Thus, a bill with an August 2 due date in the amount of $17.92 rises to $18.21 if SBC does not receive payment in full by August 2.

Britton explained the error as a printing problem.

"We don't charge on a bill that is under $20, so on the bill it was supposed to be both numbers are the same. The number that says 'if paid before' and the number that says 'if paid after' should be the same on a bill under $20."
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