Tenants Asking for Me to Subsidize Their Electricity Bill

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Tenants Asking for Me to Subsidize Their Electricity Bill

Ralph Miller
Investor · VA · Member since 2016 · 47 posts · 26 votes

I have tenants asking me to subsidize their electricity bill bc it more than doubled in the month of May-June.....this is the story.  Please provide input.

About two weeks ago their AC unit broke.  I immediately had a technician go and fix it (the next day).  It was apparently the capacitor and AC motor fan.  Repairs cost me about $700.  However, the AC unit is running a little rough and it is having a difficult time keeping the house cool so I am replacing the whole thing next week for about $2500.  Additionally, I bought them a window AC unit to use for the time being.  It will have been about 2.5 weeks since the initial problem with the AC unit started.

My tenants are saying that their May-June electricity bill is twice as high as it usually is, claiming it's because the HVAC unit has been running inefficiently due to the motor fan failure.  Thus, they're asking if I can subsidize half of the electricity bill for them.  Has anyone heard of this before?  Also, the months of May-June have gotten significantly hotter since it is the summer months, so I'm inclined to believe the electricity bill increased due to the weather, not because the AC unit has been operating inefficiently.  Any inputs?  Thanks in advance!  I love the BP community!

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Terrell Garren
Rental Property Investor · Concord, NC · Member since 2016 · 1k+ posts · 3k+ votes
8y

"I've disconnected your air conditioning". Unnecessarily heartless and unbelievable given the details provided.  A poorly functioning AC unit can certainly double the cost during hot weather. If they are good tenants, look for an acceptable compromise. If they are great tenants, I would pay half.

24Reply
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  • Erik Sherburne
    Investor · Saint Paul, MN · Member since 2015 · 98 posts · 64 votes
    8y
    What does your lease say about providing air conditioning? Is it a must? Heat in the winter is for survival but air conditioning isn't. Were they setting the temp to 74? 78? 65? All of those would have very different running costs. You made an honest effort to provide as best you can. If it were me I'd get them a Dairy Queen gift certificate and maybe a $25 credit but i wouldn't say you "must".
    4Reply
  • Ray Harrell
    Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
    8y

    I wouldn't. This is what I would say, "I'm sorry about your bill. I've disconnected all the A/C units so you won't have this problem any more."

    10Reply
  • Terrell Garren
    Rental Property Investor · Concord, NC · Member since 2016 · 1k+ posts · 3k+ votes
    8y

    "I've disconnected your air conditioning". Unnecessarily heartless and unbelievable given the details provided.  A poorly functioning AC unit can certainly double the cost during hot weather. If they are good tenants, look for an acceptable compromise. If they are great tenants, I would pay half.

    24Reply
  • Lulli Debrosse
    Howard Beach, NY · Member since 2018 · 17 posts · 12 votes
    8y

    disclaimer: I own nothing and I have never been a landlord.

    In all honesty I would take it as a loss. Going forward if the situation arises again(hope not), I would explicitly state that the window units draw more energy and the tenants are responsible for any increases.

    I don't know what type of AC unit you have, but when you say it's "running rough"...

    rough as in mechanically or it's just not cooling after the repair? If it is not cooling you might what to check the amount of charge they put into your system.

    2Reply
  • Roger S.
    Investor · TX · Member since 2015 · 393 posts · 290 votes
    8y

    I doubt the increased cost is from the AC unit problems.   However, I have in the past helped on a utility bill increase caused by a system problem.   I had a unit that had a cracked hot water line under the house that no one noticed for quite a while.    Electric and water bills almost doubled, so I gave the tenant about 75% of the increase, in cash.

    1Reply
  • Caleb Heimsoth
    Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
    8y
    I would simply tell them no to the electricity reimbursement.
    4Reply
  • Matthew Paul
    Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    8y

    NO NO NO    and if the motor or the fan stopped working , the air conditioning shuts down and doesnt work .There fore using no electricity.

    Maybe they burned more electric because it was hotter out 

    2Reply
  • Gerald Peters
    Investor · Huntsville, TX · Member since 2015 · 42 posts · 65 votes
    8y
    I would say no, I’ve had almost this exact situation. I’ve had many similar. From house robberies to tree limb fell hit renters car to ac going out on holiday it would be 4 days to get new unit, they claimed health issues and rented hotel room. They wanted me pay some or all of it. I always ask myself, if this happen to me, at my house, would someone be paying my electric bill? Repairing my car dent? House break in or dead ac. Answer is NO. They are renting a home and NOT apartment. If they don’t like that answer free to move, I’ll let you out your lease. I have conversation every renter explaining this isn’t daycare, I’m not here help them or to be their handy man. If they need adult daycare need more into apartment. I explain this so no confusion of their responsibilities and mine. If ac went out your house, u be hot, you have higher priced electric bill and no one would be subsidizing your electric.
    8Reply
  • Ned J.Pro Member
    Investor · Manteca, CA · Member since 2017 · 1k+ posts · 2k+ votes
    8y

    Nope.....

    There is NO WAY the HVAC issues you describes caused the bill to double..... not even close.

    You did everything possible to fix the issues as quickly as it was discovered....NOPE.....

    5Reply
  • Colleen F.Pro Member
    Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
    8y
    Ok so your electric bill comparison from last year should help with whether the cost is temperature. This should be on the bill or some companies provide if called. I would look at last year to this year use/cost/temp My thought would be it is the temperature and I would tell them no subsidy but if I saw a big difference between the same month this year vs last year I might consider something. On the other hand there is no way to know if they are just cranking it up.
    12Reply
  • Sam Shueh
    Real Estate Agent · Cupertino, CA · Member since 2016 · 4k+ posts · 1k+ votes
    8y

    You are in a college town with more people willing to rent. If you want to get rid of them you can be firm to them. Chk your lease.

     Warning: Stay away from MU Law School students. They talk like lawyers..... 

    1Reply
  • Dennis M.
    Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
    8y
    In the wise words of Nancy Reagan.. “ just say No” No further explanation is required
    0Reply
  • Terre B.
    Aurora, CO · Member since 2018 · 180 posts · 166 votes
    8y

    Ask to see last years bill for May - June.  Compare.  Then decide.

    4Reply
  • Account Closed
    Real Estate Investor · Marysville, OH · Member since 2014 · 242 posts · 196 votes
    8y
    Dear mr landlord will you subsidize the grow lamps I am running in the basement? Kthxbye.
    9Reply
  • Marian Smith
    Real Estate Investor · Williamson County, TX · Member since 2011 · 1k+ posts · 961 votes
    8y
    What about looking at 3 months bills including next month with the new hvac. Paying for extra electric for a struggling system doesn’t seem fair, you as owner had the sole discretion to service the unit and/or replace the unit at the end of its lifespan without waiting for it to die in the middle of summer.
    3Reply
  • Chris Szepessy
    Catskill, NY · Member since 2018 · 636 posts · 668 votes
    8y

    This is a tough one. A hot water heater had a leak at one of my rentals. The tenants told me their bill went up by $100-150 and they were just wondering if it was from the leaking hot water tank. I assumed it was and told them to take that amount off next month's rent. They never asked me to subsidize the bill.  They are fantastic tenants and while the leaking tank wasn't my fault, I just felt it was the right thing to do. However, in your case, it's tough to tell if the A/C is just running longer because of the temperature or if it's running more because it's inefficient. Also, I'm not familiar with Missouri weather, but here in NY we get some decently hot weather and I grew up without A/C and even now, I'm pretty stingy when it comes to using it, so I don't find it a necessity. I assume the A/C unit is old so it's probably been inefficient (compared to a newer model) for a while. I'm a very easy going, non confrontational person, but in this case even I would probably have to tell them no.

    0Reply
  • Christopher Goll
    Rental Property Investor · Linden, MI · Member since 2017 · 18 posts · 20 votes
    8y

    I would pay half.  No question.  Landlords are in a better financial place than tenants (usually).  The fact that they are being reasonable and asking for only half of the doubled bill seems fair.  Have a heart....it's only money...do the right thing.

    5Reply
  • Michael Plante
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    8y

    I would have an A/C tech go check the unit

    Without that you are just guessing if there is something wrong with the A/C

    0Reply
  • Charlie Vess
    Investor · Colleyville, TX · Member since 2015 · 41 posts · 18 votes
    8y
    I too recently replaced the fan motor n capacitor. The final bill came to $240. So your bill for $700 seems high. I also had a tenant complain of high electrical usage. I suggested that she call the electrical provider n have them look into the meter. Ever so often, the meter can go crazy and add a few spins to the bill. I also did a couple of surprise visits to the property. The results were she had an apt unit full of kids (suedo daycare) with the windows half opened because of the smokers. Unless your tenant is a rock star keeper, I would politely say “no”. Charlie
    2Reply
  • Nick Rutkowski
    Rental Property Investor · Ithaca, NY · Member since 2015 · 1k+ posts · 1k+ votes
    8y
    If they are good tenants, maybe throw them a small bone...someone suggested a gift card? If they are bad tenants then I’d say no to their electric bill. They should be happy to have AC again and that’s it.
    0Reply
  • Mike McCarthy
    Investor · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    8y

    Unfortunately AC can be expensive to run whether it's in tip-top shape or not.

    In Kansas City, April temps were an average of 67.  May 75, Jun 85.  I would imagine the AC was run a LOT more in May/Jun vs Apr/May.

    I might consider $50 or $100 rebate on the electricity.  I think it would go a long way in tenant relations without costing you much.  I would not agree to pay the whole difference.

    0Reply
  • Ronald West Jr.
    Member since 2018 · 2 posts · 3 votes
    8y

    Hello everyone new to Bigger Pockets, I have 2 duplexes and my solution would be take the loss for the month, pay some of the electricity bill, bc it may have spike because of inefficiency  get the ac unit fixed like you planned and then whatever the bill is after it is fixed is on your tenants. this way you can sleep at night. Lose some money now to save on another situation later. Your tenants will appreciate you and may leave you along for smaller things in the future. invest in kindness, and wait.

    2Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    8y

    I manage over 300 rentals and would not do this. They reported a problem, you are doing your best to fix it as quickly as possible.

    Their electric bill would have increased even with a functioning AC unit. This means any additional cost would be closer to 1/4 the increase or less.

    Your job is to maintain the home. You cannot guarantee that everything will work perfectly every minute of every day and they shouldn't expect it. If they want a lower electric bill they will have to turn off the A/C.

    I also agree with looking at previous utility bills as a comparison but I would only do that privately as a cross-check. I wouldn't do it with the tenant because it gives them the false hope that I'll foot the bill.

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    8Reply
  • Denice S.
    Specialist · Buffalo, N · Member since 2013 · 59 posts · 46 votes
    8y

    Tread carefully.  Are these newer tenants or are you very familiar with their tendencies?  If they are newer, less than 1 year, you will be setting the tone for all future contributions.  For instance: your leaking toilet ruined their rug,  your fridge stopped working and their food spoiled.  Your lock malfunctioned and someone broke in.  etc..

    If they are well established, great tenants then possibly a small contribution (not half) but make them go through a process. Create a form, make them attach the bill and previous bills (last year's bill etc). Then tell them to submit it for review.

    But either way, do your best to explain facts.  Fact is Electric bills are twice as high now that the hotter months are upon us.  That is 100% to be expected - double the electric when AC is used, for me sometimes triple.

    Good luck.

    6Reply
  • Ronald West Jr.
    Member since 2018 · 2 posts · 3 votes
    8y

    wow great stuff, one of the personality issues for me is learning to have thick skin...great advice guys. I'm going through a few things now with new tenants and i may have been setting the wrong precedent. 

    1Reply
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