Deposits

For existing members, GCEC evaluates a member's pay history to determine if a deposit is needed. For new members, GCEC uses ONLINE Utility Exchange to evaluate credit risk to determine if a member will be required to pay a deposit according to the Deposit Policy.

A residential applicant's deposit for permanent residential service is based on the following:

• New-service applicants who pose no credit risk will not be charged a deposit.
• New-service applicants who pose credit risk, per our use of the Equifax star system for our soft utility credit checks will be charged a deposit. A three stars credit check report will not require a deposit. A two star credit check report will require a $150 deposit, and one star or no star result on the credit check report will require a $300 deposit.
• A member will pay the maximum deposit if they had GCEC service terminated for nonpayment or has an unpaid utility bill noted in the ONLINE Utility Exchange report.
• GCEC cannot require applicants to provide their social security number as a requirement for service. However, applicants who refuse to provide their social security number pose a greater credit risk and may be charged the maximum deposit. A service applicant who provides a social security number appearing to be incorrect or fraudulent will be required to provide a valid social security number as well as additional proof of identity, like a valid driver’s license, before service will be activated.

A commercial applicant's deposit is based on the following:

• Sole proprietorships will be screened based on the sole proprietor and charged the corresponding deposit.
• Partnerships, Limited Liability Companies (LLC) and Limited Liability Partnerships (LLP) will be screened based on the managing partner or managing director, as appropriate, and the corresponding deposit will be charged.
• The deposit for all other commercial entities will be charged on a case by case basis at GCEC's discretion.

GCEC normally returns deposits to members after 1 year of service with a good payment history of no delinquent payments. However, any member who makes any delinquent payment during the initial 12-months of membership must have 12 months of on-time payments to have the deposit returned.

• Deposits are required to be paid upon receipt of payment request.
• Upon termination of service, the deposit will be applied against any unpaid bills of the member.
• Any remaining balance will be returned to the member.
• Members who terminate service and have an unpaid balance that is delinquent by more than 30 days from their final bill date shall forfeit their membership and shall not be entitled to capital credits or any other membership privileges.
• A $10 fee per application will be collected for Exchange searches.

Credit screening is designed to screen service applicants to determine their credit risk based on 3 criteria:

1. Social Security Number (SSN) verification
2. Deposit decisions based upon credit risk
3. Payment experience with other utility providers

Each of these criterion reflects the credit risk associated with GCEC providing service to the applicant. Understanding that each member is, in fact, applying for services on credit is important in protecting our membership’s assets since service is provided and then customers are billed for the service.

It cannot be stressed enough that proper identification begins with the person taking the application. The more demographic information entered into the CIS screen, such as home telephone number, place of employment, work telephone number, cell numbers, spouse’s employer and their work number, and a nearby relative not living with them and their phone number, the less will be charged off. Good demographic information leads not only to assuring the identification of fraudulent applicants, but also the ability to pursue individuals who do not pay their bill and become bad debt. The elimination of bad debt begins with the detail provided during application screening.

Who Will Be Screened Using the ONLINE Utility Exchange?

Homeowners

If the applicant indicates they own their home, or are in the process of purchasing their home, the homeowner and their spouse, if applicable, must be screened to determine their identity and credit risk. Our deposit decision will reflect the decision on the applicant who poses the greater credit risk in the case of husband and wife.

Renters

If the applicant indicates they rent their home, each person responsible for the lease of the rental unit will be screened and the deposit decision will reflect the decision on the applicant who poses the greater credit risk among those responsible for the lease. For example, 4 people are renting an apartment, and 3 pose no risk, but 1 poses high risk scores a maximum deposit. The deposit shall be the maximum deposit.

This same policy shall also apply to student housing, except any person under the age of 18 years of age shall obtain the guarantee of their parent or another adult as a co-signor. The parent or co-signor shall also be screened.

GCEC will not accept a letter of credit in lieu of screening an applicant. If a new service applicant produces a letter-of-credit, it may be placed in their file but does not contribute to deposit considerations.

If an applicant has declared bankruptcy, they pose substantial credit risk and will require a maximum deposit.

GCEC will provide an adverse action letter to each applicant who is denied service or charged a deposit. The Federal Trade Commission and the Fair Credit Reporting Act (FCRA) mandate that a consumer who is charged a deposit based upon their credit information be notified as to where that information was obtained and detailed procedures as to how they might dispute the information. It is clearly adverse action to charge a deposit to those applicants whose credit scores indicate a credit risk. Spanish-speaking applicants will receive the adverse action letter printed in Spanish.

GCEC will provide a receipt of deposit to each member who paid a deposit.

GCEC will collect money owed for service charges and deposits after a deposit is calculated. A deposit does not relieve the member of their obligation to pay the service bill when it comes due. If service is disconnect for nonpayment, the member must apply to be reconnected and pay the account balance within 1 month, plus any applicable fees for reconnection.

If the member does not reconnect the service and GCEC closes the account, the deposit plus interest will be credited toward the final bill. If a balance remains on the account, a refund will be made to the member. If a balance remains unpaid on the account after the deposit is applied, GCEC can begin collection activities.

• GCEC pays interest on required deposits at an annual rate, that is at minimum equal to the Public Utility Commission of Texas's rate set on December 1 of the preceding year.
• If a deposit is refunded, payment of interest will be made retroactive to the date of deposit.
• Payment of interest to the member will be made annually or at the time the deposit is returned or credited to the member’s account.
• The deposit stops drawing interest on the date it is returned or credited to the member’s account.

A record of each unclaimed deposit must be maintained for at least 12 months, and GCEC will make a reasonable effort to return the deposit. Any unclaimed deposits, together with accrued interest, shall be turned over to the state treasuries unclaimed property division.

GCEC can require additional deposit funds if the member's account is disconnected for nonpayment. This charge will be placed on the member's account and must be paid by the due date of the next bill or service will be disconnected.

If an account is closed, the deposit plus interest will be credited toward the final bill. If monies are still left, a refund will be made to the member. If a balance remains on the account, a refund will be made to the member. If a balance remains unpaid on the account after the deposit is applied, GCEC can begin collection activities including 30, 60 or 90 day notices, door hanger, referral to the consumer’s credit file, referral a third-party collection agency, or legal action.