Phil Querin Q&A: Conversion to Pass-Through Charges For Garbage Collection

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November 8, 2017
Phil Querin
MHCO Legal Counsel
Querin Law

 

Question. My first question deals with ORS 90.533 which provides:

 90.533 Conversion of billing method for garbage collection and disposal. (1) A landlord may unilaterally amend a rental agreement to convert the method of billing a tenant for garbage collection and disposal from a method described in ORS 90.532 (1)(b) to a method in which the service provider:

      (a) Supplies garbage receptacles;

      (b) Collects and disposes of garbage; and

      (c)(A) Bills the tenant directly; or

      (B) Bills the landlord, who then bills the tenant based upon the number and size of the receptacles used by the tenant.

      (2) A landlord shall give a tenant not less than 180 days’ written notice before converting a billing method under subsection (1) of this section.

      (3) If the cost of garbage service was included in the rent before the conversion of a billing method under subsection (1) of this section, the landlord shall reduce the tenant’s rent upon the first billing of the tenant under the new billing method. The rent reduction may not be less than an amount reasonably comparable to the amount of rent previously allocated for garbage collection and disposal costs averaged over at least the preceding year. Before the conversion occurs, the landlord shall provide the tenant with written documentation from the service provider showing the landlord’s cost for the garbage collection and disposal service provided to the facility during at least the preceding year.

      (4) A landlord may not convert a billing method under subsection (1) of this section less than one year after giving notice of a rent increase, unless the rent increase is an automatic increase provided for in a fixed term rental agreement entered into one year or more before the conversion.

 

I do not understand Subsection (4). Does it mean we cannot give a 90-day rent increase after the 180-day notice of pass-through has taken affect? Or can I still give my 90-day notice of rent increase to bring the rent back up once the trash has been separated from the base rent?

 

Answer: It means that for month-to-month tenancies, you may not convert from a base rent model to a straight pass-through within 12 months following the date you gave a 90-day rent increase notice under ORS 90.600.

 

The only exception to this rule is if the rent increase is a part of a formula provided in a fixed term rental agreement (i.e. a lease) that had been entered into one year or more before the conversion to a pass-through program.

 

 

Second Question: ORS 90.532(2)(a) (Billing methods for utility or service charges; system maintenance; restriction on charging for water) provides:

 

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 (2) A landlord may not use a separately charged pro rata apportionment billing method as described in subsection (1)(b)(C)(ii) of this section:

      (a) For garbage collection and disposal, unless the pro rata apportionment is based upon the number and size of the garbage receptacles used by the tenant.

 

When it states “number and size of garbage receptacles”, is it referring only to bins located at each tenant’s space, or can we pro-rata based on the larger trash dumpsters like the 4 yard trash dumpsters our community uses?

Answer: The term “garbage receptacles” is found at four places in ORS Chapter 90. In three of them the term stands alone, and arguably could be construed to refer to either cans or dumpsters. However, only in ORS 90.532(2)(a) does the text add, “used by the tenant.”  That suggests to me that the drafters intended to limit the term in Subsection (2)(a) to the tenant’s garbage receptacles, rather than park-owned dumpsters and bins. 

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