Contributed by the Team at LIVABLE
Billing residents for water and other utilities has benefits! Property owners can offset their expenses while encouraging conservation. Here are some of the things you need to be aware of when it comes to billing your tenants for utilities.
Great news! If you’ve decided to start billing your tenants for their utility use, you’re not only making them financially accountable for their utility use, you’re also making them environmentally accountable. Public concern about global warming exceeds 50% among most demographic subgroups of Americans, according to Gallup. People are growing increasingly concerned about the environment, and increasingly interested in ways that they can help. In a 2021 Mastercard survey, 85% of people said that they were willing to take personal action to combat environmental and sustainability challenges. Scaling back water and energy use is great for the environment, but it’s not easy to get people motivated to do that.
When residents are responsible for their utility bills, they tend to use utilities more responsibly. Billing your residents can provide them with the extra incentive that they need to conserve. There are a number of things that property owners and property managers need to be aware of ahead of time to ensure that the transition to billing goes smoothly. Keep reading for a quick overview.
Before You Choose Your Utility Billing System: Carefully Consider Your Options
You need to figure out which utility billing method works best for your multifamily property. Is retrofitting a submeter in each of your units the best move? At present, are you ready for that financial expense? How easy will it be to coordinate installations with your current tenants? Maybe you want to make use of your property’s master meter and are considering a ratio utility billing system (RUBS). This way, you skip the installation process and all its accompanying headaches and instead use a utility allocation formula that’s fine-tuned to your property.
Whichever option you’re leaning towards, why not reach out to a utility billing expert? You can get help navigating all of the rules and regulations in place surrounding billing, and benefit from their expert guidance on which system would work best for your unique property. On top of that, you can get the data necessary to help you make an informed decision. Livable has an online calculator that you can use to estimate your cost savings from RUBS, we even offer free recovery estimates!
As You Set-Up Your Billing System Be Sure You Communicate Clearly
Once you’ve chosen the best billing option, it’s time to get your tenants on board! An important part of doing that is keeping them informed. Make sure that your tenants understand what’s changing and when the changes will start. Be aware that there are guidelines that you need to follow as you’re implementing utility billing on your property. Billing methods and any applicable fees are clearly disclosed in the lease. Any changes to that lease concerning utility billing have to be outlined in a signed addendum. You also have to give your residents sufficient written notice. Don’t worry, your utility billing company can help you keep up with all the requirements!
Your tenants may also be curious about why you’ve chosen to start billing. Talk to them about the benefits of utility billing! There are environmental benefits, and more. If you were previously charging tenants a flat fee, with a new method you can give them more control over their utility usage and the accompanying expenses.
While Billing is Underway, Be Sure to Keep Communicating!
You can make billing part of your strategy to encourage conservation on your property. Sharing conservation tips can help too! There are simple adjustments to everyday actions that your residents can make to conserve utilities. According to Rutgers, families can save up to 2% on heating bills just by lowering their thermostat by one degree. Share with your tenants the information that they need to make a difference. This includes utility data. By giving your tenants access to utility usage data, they can monitor the impact that their activities have. This might even provide further incentive to conserve!
Even with careful planning and the successful rollout of your new billing system, your residents may need continuing support. If they still have questions about the various ins and outs of the system now in place, it’s important to address those questions to help keep your residents happy. Your utility billing provider can help you with that too!Livable is a full-service residential & commercial real estate billing partner. Focusing on bulk amenity/utility billing, our mission is to promote savings and conservation through education. Our suite of cloud services and end-to-end solutions helps to reduce monthly consumption, overall expenses and adds more money to your bottom line. To learn more, visit livable.com.