12-822.   Deposits to secure payment of bills; unlawful, when; investment;abandoned deposits, disposition.It shall be unlawful for any public or municipally owned utility doing businessin the state of Kansas to receive or collect a deposit from any customeras security for the payment of bills for service rendered, unless such publicor municipally owned utility shall keep a separate account of the date onwhich such deposit is received, the name of the depositor, and the amountthereof, and shall pay to the customer making the deposit interest at therate determined by the state corporation commission. Such interest shallbe credited once a year or credited on January 1 succeeding such depositand on each January 1 thereafter, to such customer's outstanding account, unless, priorto January 1, such customer shall request the payment of such interest incash, in which event payment of interest shall be made as requested. Anyinterest credited shall be subject to call and payment at any time, butshall not draw interest.

      The amount of deposit required shall at all times be reasonable, and shallbe based upon the value of the maximum service rendered; and such advancedeposit, together with the interest due thereon, may be applied to the paymentof any accrued bills, or bills due on discontinuance of service. Depositsby customers so held as security for service or for meters at the takingeffect of this act shall draw interest from that date and be credited andpaid as herein provided. Any municipally owned utility doing business inthe state of Kansas may invest money received as customers' deposits asherein provided, in investments authorized by K.S.A. 12-1675, and amendmentsthereto, in the manner prescribed therein or in bonds of the state of Kansas,or general improvement bonds of cities of the first and second class, orbonds of any county wherein a city of the first or second class is locatedwithin the state, or bonds of the boards of education in cities of thefirst class of this state, or bonds issued or guaranteed by the UnitedStates government, or in savings accounts of commercial banks.

      Any amount of security deposit, and the accrued interest thereon remainingin the account of any customer of a municipally owned utility who has discontinuedservice with such utility shall be placed in the operating fund of suchutility, upon the following conditions: (a) Such money has remained on depositwith the municipal utility for a period of more than three years from thedate service was discontinued;

      (b)   no demand for such money has been made at any time during the three-year period;

      (c)   the whereabouts of the person to whose account the money is creditedis unknown and a reasonable effort has been made to determine the same; and

      (d)   following the expiration of the three-year period, the utility haspublished, once each week for two consecutive weeks in a newspaper of generalcirculation in the county in which the utility is located, a notice listingany person whose deposit remains on account, and that a demand for suchmoney must be made within 60 days. Any security deposits remaining in theaccount of any such customer 60 days after the last publication of suchnotice shall be placed in the operating fund of such utility.

      History:   L. 1919, ch. 238, § 1; R.S. 1923, § 12-822; L. 1953,ch. 63, § 1; L. 1977, ch. 54, § 4; L. 1978, ch. 59, § 1; L. 1982,ch. 69, § 1; L. 1989, ch. 48, § 65; July 1.