NEW ULM — The New Ulm Public Utilities Commission (PUC) approved a deferment plan for unpaid utility bills related to COVID-19 on Tuesday.

The commission previously voted to waive penalties and suspend disconnection to residential and commercial customers due to the declaration of COVID-19 peacetime emergency.

Utilities Director Kris Manderfeld said because of the deferment there are nearly 200 utility bills unpaid, some three months old. In anticipation of the peacetime emergency ending New Ulm Public Utilities wanted a policy or guidelines for dealing with deferments.

“I think it is really important we have some kind of plan,” Manderfeld said. “The Minnesota Department of Commerce is looking towards utilities to have a plan. They are expecting that we do not just shut everyone off the minute once that peacetime emergency is over.”

Under this plan, no disconnects and no late payment fees would incur until the COVID-19 peacetime emergency is lifted by Gov. Tim Walz.

Disconnection policies will be reinstated at the end of the month after the COVID-19 peacetime emergency is lifted.

Utility holders will need to sign a repayment agreement within the 30 days after the peacetime emergency has ended, or the total unpaid utility bill will be due on the next billing date.

Manderfeld said this gave people the potential of 60 days before utilities were shut off. If the utility customer arranges a payment plan, an extension would be granted. An amortization schedule will be calculated to provide the amount of the deferred payment to be paid each month with a term not to exceed 12 months from the end of the emergency. Disconnection policies and late payment penalties will apply to current utility bills 30 days after the emergency has ended.

Failure to follow the terms of the repayment agreement will be subject to the normal disconnection policies outlined in the NUPU regulations.

The commissioners unanimously approved the plan.

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A separate Business Utility Deferment Program was also unanimously approved by the commission.

As a result of the financial hardships due to COVID-19, the program was developed to help businesses in the short term to open and return to normal operations.

Unlike the previous deferment program, this was for businesses that are current with their utility bills, and have been forced to close or reduce services through an Executive Order issued by Walz.

The business would be allowed to defer up to three consecutive utility bills with a bill date from this July to this December.

At the end of the month of the last deferred utility bill, the unpaid utility bills will be spread evenly over the repayment term. The business has the option of a six-month or 12-month repayment period. Interest on the amount owed will be 0.5%.

All businesses participating in the program will need to fill out an application citing the executive order that relates to their business type, identify the three months they wish to defer payment, and sign a repayment agreement.

An amortization schedule will then be provided at the end of the deferment period to lay out the payments based on the term that is requested. Once the agreement is signed, after the deferment period, all nonpayment policies will be in effect according to New Ulm Public Utilities regulations, and failure to repay will be subject to disconnection.

This program is not available to businesses utilizing the COVID-19 Deferred Payment Plan.