Billing snafu
SBC has been improperly charging a late fee to its customers

By H.W. Moss

SBC, the local telephone operating company for millions of Californians, has been telling its 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, should apply only to an unpaid balance of $20 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," CPUC program projects supervisor Norman Lows said. "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 doesn't believe any of their customers paid the late fee and says if they did, the penalty would appear as a credit on the next bill.

"I don't think consumers were wronged at all," said John Britton, SBC director of corporate communications. "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¢, 30¢ would have showed as a credit on the next bill."

But that hasn't happened. Bills that have included improper late fees have been sent to customers since April, when the company began mailing its newly redesigned invoices. At that time the company also dropped the phrase "Pacific Bell Monthly Charges" from the statements. SBC acquired Pacific Bell in 1997, but not until April did bills reflect the brand-name change.

According to the CPUC, if a utility doesn't do what its tariff says the utility is supposed to do or if it violates its tariff, that could trigger a complaint, which could require the company to issue refunds and result in penalties.

All SBC bills carry a warning that if payment is not received on or before a certain date, the customer must pay a higher amount, which is calculated at 1.5 percent monthly, or 18 percent per annum. Thus, a bill in the amount of $17.92 rises to $18.21 if SBC doesn't receive payment in full by the due date.

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."