NIACCA Gains Unfair Competition Legislation

August 8, 2002
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SPRINGFIELD, IL — The Northern Illinois Chapter of the Air Conditioning Contractors of America (NIACCA) has gained a major legislative victory in its ongoing efforts to stop unfair competition via joint marketing by gas utilities and their affiliates.

Last winter, The News detailed the arduous process that NIACCA has undertaken and reported on its progress. (See The News, Dec. 24, 2001, page 12, and Jan. 14, 2002, page 5.)

As a result, state legislators on the Joint Committee on Administrative Rules (JCAR) recommended that the Illinois Commerce Commission (ICC) seek specific statutory authority governing the relationship between natural gas utilities and unregulated affiliates. “JCAR reflected our concerns regarding joint marketing,” said Chris Colditz, chairman of NIACCA (and now president of the Illinois State Chapter of ACCA).

Heading into the spring legislative session, ICC did not introduce legislation on this matter. So NIACCA prepared and sought out sponsors for State House and Senate bills: HB 4370 (Representatives Julie Hamos and Bill Black) and SB 1962 (Senator David Sullivan). Hamos, a Democrat, and Black, a Republican, provided bipartisan support in the House.

Colditz noted that HB 4370 was a joint effort with the Citizens Utility Board (CUB), containing language that both organizations were seeking regarding the gas utility industry.

The House and Senate sponsors pushed to make the bills a legislative priority, and Colditz indicated that the chapter’s work during the 2001 and 2002 spring sessions in bringing contractors to Springfield “was now paying off.”

In February, all interested parties got together — NIACCA, CUB, Illinois Specialty and Mechanical Contractors Association (IMSCA), the state Attorney General’s office, gas utilities, and interested legislators — to figure out the best approach. At that time, it was decided that NIACCA would separately negotiate a prohibition on joint marketing with the utilities.

What followed were “a series of unproductive meetings” including NIACCA, IMSCA, and the gas utilities, said Colditz. The associations then turned to their legislative allies for help. Senator Sullivan convened a meeting in April to assess the situation and hear from interested parties. Following that meeting, and individual meetings by NIACCA with IMSCA and with the utilities, Senator Sullivan agreed to spearhead an effort to negotiate a compromise before the end of the spring session.

“This was the outcome we wanted,” Colditz stated.

At a follow-up meeting between NIACCA and the gas utilities chaired by Senator Sullivan and Representative Phil Novak, it was determined that utilities’ firm opposition to any blanket prohibition on joint marketing would keep that issue off the table. However, “We were able to gain concessions that the utilities would discuss business practices that were of concern to us,” said Colditz.

Negotiations filled most of May. “Hard work by legal counsels Chris Townsend and David Fein of the law firm Piper Redneck produced final compromise language,” Colditz commented. The compromise would require the use of a lengthy disclaimer that must accompany any joint marketing by natural gas utilities and their unregulated affiliates. Also, the language states that gas utility employees cannot market the services of an HVAC affiliate when making service calls — something that has been a sore point with many contractors, affirmed Colditz.

The compromise was added as an amendment to HB 4667. The amendment was moved out of the Senate Environment and Energy Committee on a unanimous roll call vote (7-0-0) and the legislation was approved by the Senate by a vote of 54-0-0. On the day prior to scheduled adjournment, the House accepted the amendment and HB 4667 was passed and sent to the governor on a 117-0-0 vote.

This was a real grass roots effort, stated Colditz. “Our success is due in large part to the hard work of contractors who have given their time for two full legislative sessions to come to Springfield and personally visit legislators, to stop in and see local legislators in their district offices, to attend JCAR hearings, and to write letters in support. Many have also worked hard to inform fellow contractors and recruit them to the cause. This work was the backbone of our success.”

Publication date: 08/12/2002

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