Whose Water Are You Paying For?

There’s a trend developing in the apartment industry that many renters might find disturbing. A growing number of landlords are starting to send bills to their residents for utility services that were previously included in the rent. If, for instance, you do not have a water meter for your apartment and you still receive a water bill, your landlord is probably one of this group. How does this work? Can they do that? Read on…

What does “separately metered” mean??

Most apartments built in the past few years have utility services that are separate from their neighbors and that are separately metered. This means that the residents in each apartment pay only for the amount of water, gas and electricity that they directly consume – just like the owner of a single family home does. However, most apartments built before separate metering became popular among apartment developers are metered only for electric service and some of the older buildings are not separately metered for even that. In these apartment communities, the landlord gets the bill from the utility company for any utility that is not separately metered.

What are they doing?

What many landlords have started to do is take that utility bill that they have received for the entire community, divide it up according to a formula and ask the residents to pay a portion.

Why are they doing it?

Why? Well, the landlords who are doing this will tell you it is to promote conservation and will say that they are seeing utility consumption go down by as much as 20% once residents are paying the bills. Now, no doubt some landlords do have a genuine interest in conservation and lowering our resource consumption is of course a good thing. But let’s get real! Why would they want to pay for the utilities if they can get their residents to?

Can they do that!?

Can they do that??

The bottom line is: “Yes” – they can. However, your landlord can not just send you a bill one day for water when you previously received it as part of your rent unless your lease allows it. Most leases specify what utilities are to be paid by the resident and arrangements like who pays for utilities usually can not be modified in mid-term. When your lease expires, your landlord of course can ask for a modification of the terms.

Is this fair??

Fairness, like beauty, is in the eye of the beholder. You can bet that landlords think its fair. On the other hand we certainly are hearing a different opinion from residents. For one thing, most residents think it is unfair since they are not being charged for their actual consumption. The reasoning is that if your neighbor takes hour long showers you are paying for it and no matter how frugal you are you may get a big bill anyway. Another point is that most landlords are simply adding the utility charges onto the existing rent instead of reducing the rent by the expected amount of the utility bill – making it seem like just another kind of rent increase.

Are there any regulations that landlords have to follow?

We are not aware of any states that specifically regulate landlords who charge utility costs back to their residents though of course utility companies are highly regulated everywhere. As long as your landlord is not making a profit on the procedure the belief is that the whole process is legal and not subject to utility company regulations. At least one state – California – is looking into the situation but no rulings one way or another have been made.