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Multi-Family and Apartment Investing

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Kamal H.
  • Real Estate Investor
  • Berkeley, CA
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Utilities: Multi-tenant, One meter. Help needed on transferring utilities name

Kamal H.
  • Real Estate Investor
  • Berkeley, CA
Posted Jun 8 2015, 12:28

Hello, I have seen several informative posts on who should pay utilities (landlord vs. tenant), however wanted to ask for advice specific to my case. Firstly I should say that I am the tenant in this case -- I joined these forums a while back because I was very close to being a landlord myself, however this case involves my current rental situation with my landlord.

I have a unique living situation. I live in a building that has one apartment upstairs (which I occupy) and 3 downstairs studios (used for music/artwork). I am one of three tenants here, but I am the only one living here full time. Upstairs where I live is residential, downstairs is commercial--I use one of the three rooms as a studio and two other tenants rent out the other two rooms. I've live here around 4 years and have a good relationship with my landlord. So, a longtime tenant from downstairs is moving out of his studio. For the duration of my stay here his name has been on all the bills and we pay him back. There is only one electric meter and since I'm here the most I pay 60%, and he and the other studio renter pay the rest (20% each). 

Well, now this tenant is moving out. So we have to transfer the bills out of his name. My landlord wants me to put electricity in my name--which I'd be fine with, but I don't want the responsibility of having to collect utilities from other tenants. Sure the previous tenant took on this responsibility but he and the landlord had this long-term relationship. The landlord has all but refused to put the electric bill in her name and we are close to having the power cut off if we don't decide. I've suggested that I put the bill in my name, which I'm fine with, but that the onus of collecting from the other tenants should be on her--so I would pay the single bill in full each month, but then take out the 40% owed by the other two tenants in my monthly rent/utilities payment to her (my landlord). This seems reasonable to me, since I'm taking responsibility for the full bill upfront, and paying my 60% portion. It's just that I would pass on responsibility for the other tenants portion to her. She doesn't want to do it this way claiming that doing the math each month is too complex (even though I offered to make her an Excel spreadsheet to help her keep track). Also she is concerned that if my monthly payments to her vary (because I would deduct tenants utilities which I already paid), she thinks it will look like she is collecting variable rent?? 

Overall I have a good relationship with my landlord and just want something that is fair. But I feel like she is used to the previous setup where a tenant took full responsibility for paying for a single meter, and now that he's moving out she wants me to take on this responsibility. Any suggestions on a fair way to proceed? Again, I'm fine having the bill in my name, it's only that I don't want to be responsible for collecting utilities from my downstairs neighbors. Any advice appreciated.

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