Pennsylvania Statute of Limitations for Collection of Utility Bills

Utility bills are a necessary evil when owning a home or renting property. Paying these bills on time can help your credit, keep the lights on and the water running. Failing to pay utility bills on time can hurt your credit and cause the shut-off corresponding utilities. The statute of limitations for utility bill collection in Pennsylvania provides a specific time period for companies to pursue utility customers for debts.

Utility Debt Status

Pennsylvania considers utility bills as written contracts for debt collection purposes. A written contract lasts for a finite period of time. In this case, the contract lasts for as long as the debtor lives in her current address or closes the utility account. Utility bills bear some similarity to revolving accounts, like credit cards, in that a debtor may carry a balance from month-to-month though utility companies do no usually charge interest on the accounts as credit card companies do.

Statute of Limitations

The statute of limitations for debt collection of utility bills in Pennsylvania is four years. Utility companies have this length of time to pursue a debtor for money owed from utilities before the ability to sue the debtor in civil court expires. Utility companies have an advantage in the collection process in that these companies can shut off utilities tied to delinquent accounts until the debtor decides to bring the account current. No running water or electricity is a powerful motivational tool in compelling a debtor to bring utility accounts current.

Wage Garnishments/Property Liens

Wage garnishment for a utility bill is illegal in Pennsylvania. A utility company's ability to turn off a delinquent customer's access to a utility somewhat mitigates the lack of wage garnishment since it can help to limit the company's financial loss. A utility company may attempt to secure a property lien against a debtor through a civil court judgment. The lien attaches a debtor's property and entitles the utility company to a share of the profits from the sale of the property either through the debtor's own voluntary sale or through bankruptcy.

Alterbative Collection Methods

Pennsylvania law requires all utility companies operating in the state with annual revenue exceeding $40 million to offer Customer Assistance Programs (CAPs) to help delinquent utility customers with low incomes pay utility bills. These programs allow customers to make monthly payments in proportion to family size and gross income. Customers make these lower monthly payments, which may be lower than actual monthly charges, in exchange for continuation of service. This allows utility companies to keep more accounts out of collections and encourages more customers to make payments.