Officials target water billing

2 delegates sponsor bill that would ban estimates for tenants

`Should ease the burden'

Property owners say move would force them to raise rents

Howard County

February 21, 2003|By Jason Song | Jason Song,SUN STAFF

Del. Elizabeth Bobo has introduced legislation that would ban the business of using estimates to charge apartment residents for their water and sewer bills within a year, limit the service fees charged by billing companies and impose a stiff fine on any landlord who does not charge residents for their exact usage.

The bill, co-sponsored by Harford County Democratic Del. Mary-Dulany James, could give Maryland some of the most strict water-billing regulations in the country. Such states as Oregon, North Carolina and Texas have regulated the industry, and debates over the practice of unmetered billing are raging elsewhere across the nation.

"This should ease the burden on apartment residents, especially among the lower-income renters," said Bobo, a Howard County Democrat, who introduced the bill Feb. 14.

Water and sewer costs traditionally had been included in rent. But over the past decade, the cost of water has risen and more landlords have begun charging tenants for their water and sewer.

Some landlords have installed meters in individual apartments. While this is relatively inexpensive in new complexes, it can cost several hundred dollars per meter in older buildings.

Other landlords contract with independent billing companies, which take a complex's total water and sewer cost and subtract a percentage for common area water costs such as pools and sprinklers.

The company then divides the remainder by a variable such as the number of people, square feet or rooms in the apartment. Under such formulas, one person renting a two-bedroom apartment could pay as much as a family of four using the same-sized unit.

The billing company is responsible for charging apartment residents and usually collects a monthly service fee, generally about $3.

Landlords and billing companies acknowledge that estimated billing is not a perfect system, but say they often have no other choice in older buildings and that residents will use less water if they are forced to pay for it. Some companies estimate that apartment complexes can save 2 million gallons a year if they use estimated billing.

Differing views

Landlords and billing companies say residents are not overcharged. But a review last March by The Sun showed that some families in apartment units without dishwashers or laundry machines paid more than $40 a month for their water and sewer - as much as families living in large suburban homes with lawns and multiple bathrooms pay.

After studying the practice, a Howard County citizens group recommended in December that the County Council adopt laws that would outlaw estimated billing by 2013, limit service fees and require metered billing on all new apartment complexes.

A Montgomery County citizens group has recommended this month that their County Council limit service fees and mandate that billing companies only use a per-person formula when calculating bills.

Bobo's bill would outlaw estimated billing by Jan. 1, 2004, and would subject any owners who use the practice to a $1,000 fine. And apartment owners using a third-party billing company to administer bills to each apartment complexes would be limited to charging $2 a month in service fees.

Howard County Councilman Guy J. Guzzone, a North Laurel-Savage Democrat, said he would support the bill, although Howard County is considering outlawing estimated billing.

"There are some advantages that the state has over the county in terms of enforcement," Guzzone said.

Ken Ulman, a west Columbia Democratic county councilman, also said state legislation should take precedence over county legislation. But if Bobo's bill does not pass, Ulman said, Howard County will press its legislation. "We could set an example for the state," he said.

But landlords and billing company officials decried Bobo's bill. "This bill would take away a big conservation tool," said Jim Caffey, executive vice president of the Maryland Multi-Housing Association, Inc., a group that represents 65 properties in the state.

A prediction

Caffey predicted landlords would have no choice but to raise rents if they cannot use estimated billing.

Bill Griffin, co-chairman of the National Submetering & Utility Allocation Association, said the cap on monthly service charges could drive some companies out of business.

"I don't know of many companies that can turn a profit on $2 a month," said Griffin, who is also an official with National Water and Power Inc., an estimated-billing company in Santa Ana, Calif.

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