D.C. Mun. Regs. tit. 15, r. 15-4605
Current through Register Vol. 71, No. 52, December 27, 2024
Rule 15-4605 - BOND REQUIREMENTS FOR FINANCIAL INTEGRITY ("INTEGRITY BOND")4605.1Applicability. Any Applicant or Licensee that can provide credible evidence that it meets one of the following standards is not required to post an Integrity Bond in the District of Columbia:
(a) A current credit rating of BBB- or higher from a nationally recognized credit rating service;(b) A current commercial paper rating of A2 or higher by Standard & Poor's and/or P2 or higher by Moody's or similar rating by another nationally recognized rating service; or(c) An unused line of bank credit or parent guarantees deemed adequate by the Commission.4605.2(a)Exclusion. An Applicant or Licensee that cannot provide evidence to the satisfaction of the Commission that it meets the standards listed in §§ 4605.1 will be required to submit a copy of an initial Integrity Bond of fifty thousand dollars ($50,000), unless that Applicant or Licensee is applying to provide service as an Aggregator (as defined in D.C. Official Code §§ 341501(2) and §§ 4699.1 who does not take title to electricity or as a Broker (as defined in D.C. Official Code §§ 34-1501(7) and §§4699.1), in which case a copy of a ten thousand dollar ($10,000) Integrity Bond will be required. However, an Applicant or Licensee that meets the standards listed in §§ 4605.1 may still be required to provide a bond to demonstrate financial integrity for the Application on a case-by-case basis.(b)Updates. The Commission in its sole discretion may determine whether or not to reevaluate the amount of the Integrity Bond in light of any changing conditions in the electricity market at the time that a Licensee submits updated information, taking into consideration the Licensee's previous and ongoing relationship with its Customers and its historical compliance with Commission rules and requirements. The Commission may request such information from the Licensee as may be necessary to make its evaluation. Aggregators who do not take title and Brokers will not be required to update the initial $10,000 Integrity Bond.(c)Requests for Bond Return and Waiver.(1) A Licensee that has provided two (2) years of continuous and uninterrupted service to customers and has previously submitted and maintained a copy of an Integrity Bond with the Commission in compliance with these requirements may file a request with the Commission for a determination of the Licensee's financial integrity and whether the maintenance and continuation of the Licensee's bond is necessary;(2) Upon such request, the Commission shall make a determination of the Licensee's financial integrity, whether maintenance and continuation of a bond is necessary, and shall inform the Licensee of its decision in writing. If the Commission determines that a bond is no longer necessary, the Licensee may subsequently file an application with the Commission to request the return of the previously posted copy of the Integrity Bond and to waive the requirement for a future bond;(3) The Commission shall issue an order on the Licensee's application and base its decision upon the Licensee's demonstrated record of continuous and uninterrupted service to customers in the District of Columbia, the absence of any evidence of any substantiated consumer complaints, and any other such information the Commission may consider appropriate under the circumstances, as determined by and in the opinion of the Commission;(4) The Commission may require the Licensee to submit a copy of an Integrity Bond at a later date if the Commission deems the requirement of an Integrity Bond to be necessary and appropriate; and(5) A Licensee that is not currently providing service and cancels its bond shall have its license suspended immediately, and is subject to revocation of its license in thirty (30) days following the bond cancellation.4605.3Form of the Bond. Any Applicant or Licensee required to provide a bond under this section shall provide a bond issued by a company authorized to do business in the District of Columbia in a form required by the Commission. The Applicant shall file a copy of this bond, with a notarized verification page from the issuer, as part of its application for a license. At a minimum, this form shall:
(a) Designate the Commission, as the sole beneficiary of the bond;(b) Be continuous in nature. If any Licensee seeks to cease providing the bond it shall seek approval from the Commission at least sixty (60) days prior to the time it wants to discontinue maintaining the bond;(c) Cover payment of the Licensee's District of Columbia Deposits and Prepayments that occurred while the bond was in force as identified by the Commission under these regulations; and(d) State that the proceeds of the bond shall be paid or disbursed as directed by the Commission. 4605.4 Commission Verification. Each Licensee shall provide appropriate certification as prescribed by §§ 4604.2 (b) and (c). The Commission may request such information from the Licensee as is necessary to verify the accuracy of the certification at any time.
4605.5Bond Foreclosure. The Commission's foreclosure of an Integrity Bond shall be limited to those instances where damages to the Customer(s) by the Licensee are actual. In order to draw funds on this Bond, the Commission shall determine that the Licensee is financially insolvent or unable to meet its obligations as a Licensee to a Customer(s) who has suffered actual damages by means of failure, or by reason of the Licensee's breach of contract or violation of the Act and any orders, regulations, rules or standards promulgated thereto.
D.C. Mun. Regs. tit. 15, r. 15-4605
Final Rulemaking published at 65 DCR 9970 (9/28/2018 - Vol. 1); amended by Final Rulemaking published at 69 DCR 6055 (5/27/2022); amended by Final Rulemaking published at 71 DCR 7434 (6/28/2024)