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OED deposits to be based on credit

The Oxford Electric Department has changed its deposit structure for new customers for the second time in as many months.

Last month, the Oxford Board of Aldermen approved changing the way the Oxford Electric Department set its deposits for new customers. Instead of the previous flat fee, the new deposit was based on an applicant’s credit.

However, on Tuesday, OED Superintendent Rob Neely approached the board again and asked for permission to switch it back.

The revision passed in August was required by the Tennessee Valley Authority to align the existing Rules and Regulations with TVA’s newly developed Service Practice Standard framework.

The Tennessee Valley Authority recently released a new set of service practice standards by which all local power companies who purchase their power from TVA must come into compliance. One of the issues TVA discussed with OED was its deposit structure that was based on home ownership versus those renting. TVA determined that deposit structure was discriminatory to the residential rates and that OED had to adopt either a flat or credit-based deposit.

So in August, OED decided to go with the credit-based deposit option.

Since August, OED contacted Online Utility Exchange to begin the process of offering credit-based utility deposits. The company submitted a contract to OED for review on Aug. 7. The contract was reviewed by OED personnel and forwarded to city attorneys for review and approval.

“Of course there were the normal issues that the city faces with regard to contract language,” Neely said Tuesday. “In addition to those, the attorneys discovered issues OED could face (with the credit-based program), which includes provisions under the Fair Credit Reporting Act and Gramm Leach usage and protections.”

After further discussions with attorneys and Mayor Pat Patterson, Neely said it was decided that it would be best to have a flat residential electric deposit for all customers.

Neely asked the aldermen to approve a flat $150 for all customers, which is $25 less than renters were paying previously.

The board approved the request unanimously.