Phil Querin Q&A: Billing Back Sewer Charges to Residents

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April 9, 2014

Question: Our park does not have individual meters and at this point both the water and sewer on included in the monthly rent charge. Is there a method for billing back the sewer charges (no water) to the residents?

Answer: Sewer changes are considered a utility. ORS 90.532 (“Billing methods for utility or service charges”) provides that, subject to certain exceptions, landlords may provide for utilities or services to tenants by one or more of several alternative billing methods, depending upon the billing “relationship” between landlord and tenant: 1. A relationship between the tenant and the utility or service provider in which the utility provider provides the utility or service directly to the tenant’s space, including any utility or service line, and bills the tenant directly; and the landlord does not act as a provider. 2. A relationship between the landlord, tenant and utility or service provider in which the utility provider provides the utility or service to the landlord; the landlord provides the utility or service directly to the tenant’s space (or to a common area); and (a) the landlord: includes the cost of the utility or service in the tenant’s rent; or (b) bills the tenant for the utility or service charge separately from the rent in an amount determined by apportioning on a pro rata basis the provider’s charge to the landlord as measured by a master meter. 3. And lastly, a relationship between the landlord, tenant and utility or service provider in which the utility provider provides the utility or service to the landlord, the landlord provides the utility or service directly to the tenant’s space; and the landlord uses a submeter to measure the utility or service actually provided to the space and bills the tenant for a utility or service charge for the amount provided. It appears that No. 2(a) above may currently apply to your situation. In order to “charge back” the residents, I assume you mean charge them directly (outside the base rent) for the cost of the sewer service. Thus, what I understand you to be asking, is whether you can “convert” from 2(a) to 2(b). If your current sewer service is measured by water consumption, and your intent is to separately charge residents a pro rata basis calculated by a master water meter, then ORS 90.532(2(c) applies, which provides that a landlord may not use a separately charged pro rata apportionment billing method for sewer service, if sewer service is measured by consumption of water and the rental agreement was entered into on or after January 1, 2010, unless the landlord was using a separately charged pro rata apportionment billing method for all tenants in the facility immediately before January 1, 2010. By your question, it appears that sewer and water are both included in base rent, at present. Thus, the prorata method (i.e. direct billing for sewer charges outside of base rent) would only be allowed if you already had it in place for all residents prior to January 1, 2010. Unfortunately, it appears that unless you begin submetering your water, you will be unable to separately charge for sewer on a prorata basis outside of your base rent.