Who to contact about metering utilities seperately?

Question

Hey BP!

Here is the quick and dirty. A partner and I are closing on 5 single family properties in Shawnee, OK at the end of the week. Two of the homes are on one lot, and the water is NOT metered seperately. Also, the current owner has been paying the water bill for these homes, for years. My partner and are trying to find a solution that allows us to push this expese back to the tenants. Does the BP community know if there are contractors that will install a metering system that will allow the tenants to be billed by, and pay the city for water? Can we just start charging the tenants based on historical average usage (by adding a clause to the lease)? Or, is there another option that I am not aware of?

Thanks!

Andrew Terrell · Answer

Mike,

Thanks for the information. I checked with the city, and I dont think adding a meter, water supply, and sewer line are an economically feasible option. The city was able to give me the average cost of the bill over the last few years, so I think we are just going to build that cost into our lease. One unit is vacant, so we will have the new tenant sign our lease with that clause and cost built in, when we find them. As for the other tenant, we plan on having them sign our lease (they have been there for years, and are operating on a month-month status from the old owners lease) and also add that cost into their new lease with us. Although the bill will still be in our company's name, and we will pay it, just with the "extra" money generated from that new statement.

Rhett Tullis · Answer

we deal with this often on many properties a few things to consider.

-@Dylan B. you have to get a permit from the city first to add another meter and then work with the utility.  it is quite a process and generally not cost effective

-there are services that will sub meter for you for a fee but in that small a complex it usually does not make sense.

-you can add the fee for utilities but if your rents are at or above market then good luck getting them to agree to it.

-you will need to get them to agree in writing to the change in rate for utilities if you want to be on the up and up.

-you might consider a clause for if usage goes over the historical average of the bills.

-also some tenants may feel that since they are "paying" for the utility they can use all they want, ie have their relatives come do laundry etc so keep an eye out on that.

Stephen G. Wolff · Answer

I build a base amount into the lease and add a bill back over $XX provision. The reimbursement is made within 30 days. For example if the rent is $2000.00/month and the water bill has averaged $60 then I sent the rent at $2075 and bill any overages. I use a small buffer to eliminate the need to bill back.

Dylan B. · Answer

Following this tread.  Anyone from the OKC area dealt with this type of scenario?

Who to contact about metering utilities seperately?

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