Guaranteed Price Plans and Prepaid Contracts for Home Heating Fuels Sold in Vermont
This document provides a summary of the compliance requirements for dealers engaged in the retail sale of home heating oil, kerosene, or liquefied petroleum gas (LPG) under guaranteed price plans and prepaid contracts in accordance with 9 V.S.A. § 2461e. This law applies to all dealers offering fixed-price contracts, prepaid contracts, cost-plus contracts, and similar agreements for home heating oil, kerosene, or LPG in Vermont. As always, seek your own legal counsel.
Contract and Solicitation Requirements
All guaranteed price plans and prepaid contracts must be in writing.
The terms and conditions of the price plans must be disclosed in plain language.
The disclosure must immediately follow any language concerning price or service impact and be printed in no less than 12-point boldface type.
Solicitations offering guaranteed price plans that may become contracts upon consumer response must also be in writing and include plain language disclosures.
First-come, first-served offerings are permitted.
Security Requirements for Prepaid Contracts
A dealer must secure prepaid contracts by maintaining one of the following within seven days of contract acceptance:
Futures Contract: Purchase contracts covering at least 75% of the maximum gallons committed under all prepaid contracts.
Surety Bond: A bond covering at least 50% of the total prepaid funds received from consumers.
Line of Credit, Letter of Credit, or Cash: Funds equivalent to 100% of the cost of the maximum committed gallons held in an FDIC-insured account.
These securities must be maintained for the contract duration but may be reduced to reflect delivered and paid-for fuel. This requirement does not apply to budget plans where consumers make equal monthly payments over the year.
Additional Contract Requirements
The contract must specify:
The total funds paid by the consumer.
The maximum number of gallons committed for delivery.
The type of financial security ensuring contract performance.
Reimbursement Provision: Any undelivered prepaid fuel at the end of the contract must be reimbursed to the consumer within 30 days unless both parties agree otherwise.
Enforcement and Legal Recourse
Dealers may take legal action against suppliers for failing to honor contracts.
Dealers pursuing claims may recover remedies available to consumers under Vermont’s Consumer Protection Act.
Compliance and Recordkeeping
Dealers must maintain records demonstrating compliance with security and disclosure requirements.
Documentation must be readily available for regulatory review.
Penalties for Non-Compliance
Failure to comply with these provisions may result in penalties under Vermont's Consumer Protection Act, including fines, contract invalidation, and potential civil actions.