What utilities do your tenants pay?

15 Replies

I’ve been trying to figure out which utilities landlords are required to pay in Minnesota, but the legalese of the MN State statues has me confused. Which utilities are landlords required to pay in Minnesota, and which utilities do you specifically have your tenants pay (if your answers are different)?

@Tom Hertel  The landlord is not required to keep any in unit utilities. Colored is required to pay all common area utilities unless the usage is below the de minimus levels. 

Originally posted by @Tim Swierczek :

@Tom Hertel  The landlord is not required to keep any in unit utilities. Colored is required to pay all common area utilities unless the usage is below the de minimus levels. 

Thanks as always Tim. So, assuming we are talking multifamily with individual meters, sewer and garbage are paid by the landlord while electricity, heat, and water are paid by the tenants?

I always pay trash and water but it’s not required by the state of Minnesota you can have the tenant  pay them.    In addition tenants can pay if it’s not separately metered however there are laws around how you bill them. The state doesn’t require the landlord pays if it’s a single meter.  @Tom Hertel

Originally posted by @Tim Swierczek :

I always pay trash and water but it’s not required by the state of Minnesota you can have the tenant  pay them.    In addition tenants can pay if it’s not separately metered however there are laws around how you bill them. The state doesn’t require the landlord pays if it’s a single meter.  @Tom Hertel

Does the market really dictate paying trash and water? A lot of places I see have landlords paying water, trash, garbage, and gas (for heating). That’s seems like a lot of unnecessary expenses, but maybe that’s just me?

@Tom Hertel water stays with the property so if the tenants don’t. It becomes an Line your property in the church better just to include it in your trash is something that is less important took for the landlord to pay but it can’t b stays with the property so if the tenants don’t. It becomes a meeting on your property in the church better just to include it in your trash is something that is less important took for the landlord to pay but  if left to the tenant they may cancel garbage service in the property becomes a dumping ground   

I don’t know about St Paul, but in Minneapolis landlord is responsible for water/garbage bill in a multi family if there’s only one water line. Most duplexes have one.  There are exceptions - if a duplex has two water meters, then each unit (tenants) is responsible for their own and landlord is responsible for sewer/storm fees. 

Heating is same - if there are two furnaces or two boilers - each unit is responsible for their own. If there’s one boiler - you can split it between two units but need to provide history of bills for the past 12 months. 

In short - in most duplexes - tenants pay their own gas, electric, internet/cable. Landlord pays for water/trash, snow removal, lawn care. 

I either personally maintain or pay for anything that is shared because if there isn't a direct line to a responsible party it is always NMP (not my problem) in the tenant's mind and the small issue will eventually be a big problem. Snow has melted and refroze and is 6" thick ice, grass isn't cut and the city issues a citation, garbage bill not paid and now you have accumulation of trash which can attract rodents or upset neighbors. So water, garbage, lawn, snow just as @Pavel Ushakov mentioned are on me. The one small exception I have is that in my lease I set the expectation that an assigned parking spot (outdoor, uncovered, unpaved) is the tenant's responsibility to maintain so they should shovel, rake, and trim plants.

I do suited houses almost exclusively, power is metered separately and tenants pay that. Heat (gas) and water is not separately metered and I charge a flat rate based off occupancy for that.

Ads state flat rate utilities of ___ for single occupancy (or double or whatever).

Pro of having a tenant pay a utility is that the utility co screens them also. Let hem know up front, they won’t even apply if they’ve got a $500 debt to pay...
con of course is that many jurisdictions allow util co to pass it to homeowner if unpaid.

Originally posted by @Pavel Ushakov :

I don’t know about St Paul, but in Minneapolis landlord is responsible for water/garbage bill in a multi family if there’s only one water line. Most duplexes have one.  There are exceptions - if a duplex has two water meters, then each unit (tenants) is responsible for their own and landlord is responsible for sewer/storm fees. 

Heating is same - if there are two furnaces or two boilers - each unit is responsible for their own. If there’s one boiler - you can split it between two units but need to provide history of bills for the past 12 months. 

In short - in most duplexes - tenants pay their own gas, electric, internet/cable. Landlord pays for water/trash, snow removal, lawn care. 

What about submetering? I remember @Brandon Turner half-mentioning a company on the podcast that will submeter with wireless tech. After some googling, I think it’s Guardian Water and Power he was talking about (http://www.guardianwp.com/). 

Take it with a grain of salt because they are a for-profit business, but their website says that submetering of water, gas, and electric are all “permitted” in Minnesota. I guess it’s just a matter of cost for installation and maintenance of the submetering.

@Tom Hertel I agree with what others are saying.

For SFHs I have them pay all utilities.  No issues with this in my city but some cities require city services to be in the owner's name.  You can increase rent or seek reimbursement if you have this issue.  For me the hassle of getting reimbursed is something I don't want every month so I estimate and gross up rent.

For MF it depends on how the property is setup.  I usually pay for trash as it is cheap and would be a hassle to have this in one tenant's name.  You can allocate out unmetered utilities but I haven't messed with it.  If I am paying heat I am more inclined to gross up rent and cover the cost.  Here is the MN AG handbook which discusses single metered utilities: https://www.ag.state.mn.us/brochures/pubLandlordTe...

I am working on a major rehab soon to convert a SF house to a duplex and plan to put all utilities on the tenants.  Will be easy as it is a full gut job but I will have to figure out if it is worth it for water. 

My two cents:  

1)  @Tim Swierczek is correct on Minnesota landlord law, landlords are not required to pay a specific utility per se.  Tim is also correct about the ticking time bomb if a tenant's name is on the water bill.  If you go direct to tenant name on water, obtain additional security deposit to cover non-paid water (it can run hundreds to thousands of dollars).  

2) BE AWARE of the single meter statute 504B.215 and tenant advocate attorneys.  I have defended a landlord against a tenant rent escrow (duplex tenant) seeking a large settlement due to no access a garage, but allegedly paying for electric utilities for the garage.  The issue would have nominal in cost to address had the landlord also not had attorney costs language in the lease for the landlord (that is another issue).   

Real quick, duplex type properties can quickly become utility liabilities if not handled the correct way (ex:  2 meters but only 1 washer and dryer).  The statute also distinguishes between "utilities in rent" vs. "utilities separate from rent."  If you have fact or property specific questions, DM me.  

I have one of my tenants take care of snow and lawn care with a rent break (usually $50 a month).  That is a much more economical way for me to have those items taken care of.  On the other utilities, if I can have the tenants pay for it, I try to farm it out to them (as much as I can).

@Tom Hertel if you want to talk to an expert contact @Brad Schaeppi

Brad - I will be contacting you soon about updating my leases and correctly setting up metering on a renovation we are completing.  Full gut job and conversion to a duplex.  Trenched larger service to the house, installed a two meter socket box for 2 panels and want your opinion on correctly sub-metering water/sewer before the re-plumb.

Yea, only difference between my SFR and Duplex is lawn/snow maintenance. Everything else is fairly linear with me paying only water/sewage/garbage.

We rent out a lake home on Lake Mille Lacs in Garrison, MN. The tenant screened well but it’s been a total nightmare since move in. There is always one issue after another, can’t pay rent, sewer going unpaid, etc.

Today I received a letter in the mail from the local garbage collection company. They stated that in Spring of 2018, service was established  by the tenant, however no payment was never received for service. The company states there is an outstanding bill of $601 and they have received a judgment in their favor against the tenants. The tenants have not responded to this judgment. And the letter states  that the company will be seeking further legal action against the property through their attorney. They also  quote “legal costs amounting to another $200.“ 

It is my understanding, that because these are independent services not provided by the city or county, alien cannot be filed against our property. Is that correct? Any help you can provide is much appreciated thank you!

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