Unmetered Water-Bill Plans Face Challenge

Source: 
Baltimore Sun

Apartment residents hate unmetered water billing because it takes money out of their pockets each month. Landlords love it because it saves them money. Conservationists aren't sure whether it saves or wastes precious water.
Across the country, regulators struggle with whether they should limit or outlaw it for the sake of renters.
Now Howard County's (Maryland) political leaders are about to wrestle with the issue as they launch an investigation of unmetered water-billing practices in apartment and condominium complexes.
Six appointed residents will begin hearing testimony about the pros and cons of the practice, known as RUBS, for Ratio Utility Billing System. In plain English, that means billing without meters.
Thousands of Howard County residents of apartment complexes using RUBS are being billed based on estimates of their water and sewer use - not actual use.
Some say the billing is unfair because their bill would be the same whether they use a little water or a lot. More disturbing, they add, is that some pay up to 60 percent more in water and sewage costs than homeowners who have meters.
A Sun article in March examined the bills of tenants in four apartment complexes that use RUBS and showed that some families of four pay nearly $400 annually for their water and sewage. Howard officials estimate a family of four living in a detached house would pay about $250 a year.
"Something is wrong with the system. ... I'm very confident that we're going to do something about it," said Councilman C. Vernon Gray, an east Columbia Democrat.
But Gray isn't sure what can be done. While RUBS has drawn criticism around the country, it is a difficult area to regulate because it is a relatively new practice and because there's "only very weak data out from unreliable studies," said Peter Mayer, vice president of Aquacraft Inc., a Boulder, Colo., company that is conducting a nationwide study of water billing practices.
Historically, apartment owners have included the cost of water and sewer in rent. But in complexes that administer RUBS, landlords will pay a share and then forward the bills to a third-party billing agency. The agency then calculates tenants' bills using an allocation formula that depends on variables such as the number of residents or rooms, or square footage.
In Howard County, billing companies also add a $3 service charge to their monthly bills and a $10 start-up fee.
Tenants then pay the billing companies, who keep the service charges and forward the rest to the landlords.
The practice has been widely criticized by tenants and water experts across the country who say RUBS use is unfair. Even water-billing agencies say they prefer their customers to put a meter in each apartment to monitor exact use, a practice known as submetering. It is more accurate and generally causes fewer tenant complaints, industry experts say.
"The question is, do [landlords] want the Mercedes or do they want the Chevy? If they want the Mercedes, they should submeter," said Stevyn Muller, vice president of Midway Services Utilities, a Clearwater, Fla., company that administers RUBS and submetering. Midway provides submetering services for Archstone Columbia Town Center.
Some studies show that submetering encourages residents to save water, while most show less incentive to save under a RUBS plan. A 1999 study conducted by the Orange Water and Sewer Authority in North Carolina showed that, on average, submetered accounts use 17 fewer gallons of water a day than apartments that use RUBS.
Experts say that RUBS encourages conservation, but it can never be as effective as submetering because RUBS provides less incentive to save.
"Equity says that [submetering] is the right way to go," said Al Dietemann, a senior policy analyst for the Seattle Public Utilities.
However, landlords and third-party billers say they often have no choice but to use RUBS. It can cost more than $300 per apartment to install submeters. In older buildings with outdated plumbing, it is virtually impossible to install submeters without replacing the pipes, which would cost thousands of dollars.
States and municipalities have regulated unmetered billing in a variety of ways. Some, such as Miami-Dade County, have banned RUBS, but most have tried to find a happy medium.
The Texas Natural Resource Conservation Commission, which regulates water use in that state, requires all parties that administer RUBS to register with it. The commission forbids anyone from making a profit by reselling water.
Texas encourages landlords to submeter whenever possible. The state has adopted laws that require all new apartments and condos to have a plumbing system that "is compatible with the installation of submeters," beginning next year.
Massachusetts bans all water Reselling, but is considering a bill that would allow submetering. As written, the bill would let landlords install submeters, which would have to be checked by plumbers to ensure accuracy. Landlords could not charge additional billing or meter-reading fees, or for water leaking from defective piping, under the bill.
Conservationists in Massachusetts, which is suffering through a severe drought, generally support the bill being considered by the state Senate.
"The drought development pressures can't be ignored and ... at a conceptual level, [submetering] would create incentive to save water," said Christopher Hardy, the legislative liaison for the Massachusetts Audubon Society.
While no laws regulate submetering or RUBS in Maryland, Howard County and other municipalities might soon have an example to follow. A Montgomery County citizens commission is finishing the final draft of legislation that would regulate RUBS and submetering. Final details have not been made public, but the group is recommending that landlords be given three formulas to use when administering RUBS.

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