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Utility billing

Started by VictorN2 • 15 replies • 272 views

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VictorN2 (California)
Posts: 12
Posted:
Our hoa used to have a utility billing company bill the 450 homes for water usage. We got rid of the billing company because they stopped billing the homes. A board member wants to take over the billing. Is this legal in ca or we need to continue to use a licensed utility billing company.

Thanks
MaxB4
Posts: 3,513
Posted:
First question, if the billing company stopped, who is doing the billing? I am assuming you're detached SFH's.

Myself and one of our Board members did it for our community of 318 SFH's back from 2010 to 2013. We had some rogue board members and a group of "unpleasant" homeowners that felt the management company should be doing all the work and it wasn't our business to meddle. We had the process down to a science and it was a well oiled machine. Our landscaper were supplied with hand held readers and we uploaded into our software. We were able to stay on top of payments and delinquencies.

Can the owners do their own billing? Absolutely! Should they? Based on my experience, probably not.
VictorN2 (California)
Posts: 12
Posted:
No one did the utility billing for 8 months. It was a very long process with lawyers to get rid of the previous utility billing company. We are attached town homes. Every home has its own submeter. So a board member got the data from next century which is the meter company that gets the electronic reads. Now that board member wants to use the data and back bill each home owner. Just wanted to make sure its legal for hoa to do the billing?
Thanks
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Quote:
Posted By VictorN2 on 08/17/2022 10:54 AM
No one did the utility billing for 8 months. It was a very long process with lawyers to get rid of the previous utility billing company. We are attached town homes. Every home has its own submeter. So a board member got the data from next century which is the meter company that gets the electronic reads. Now that board member wants to use the data and back bill each home owner. Just wanted to make sure its legal for hoa to do the billing?
Thanks

I would say yes. They used the water so bill them for it.
SheliaH (Indiana)
Posts: 6,964
Posted:
Why does this board member want to complicate everyone's time and life like this? If your units have their own meters (like in my townhouse community), it's easier for the utility company to do whatever if someone moves in or out, or refuses to pay. There's also the prospect of people arguing over paying X amount because they just KNOW they didn't use that much in a month.

I suppose this board member want to go down this hellhole in hopes of having another weapon to use against delinquent homeowners. Did he or she explain with this is a good idea? If not, make him and then urge the board to vote down this foolishness. You

PS, most of us aren't attorneys and don't live in your state - you want answers to specific legal questions, consult a private attorney. If you're on the board, you should have already run this by the association attorney And perhaps the electric company to see if this is even feasible.

And read your documents - are utilities like electricity supposed to be provided by the association? If not, that's another reason to shoot this down
If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
MaxB4
Posts: 3,513
Posted:
The answer is yes, the HOA could take over water billing, BUT should they? I am wondering if the question is also, can the HOA go and back bill for months that weren't billed because of their decision not to continue with Next Century. That will be a question for your attorney, BUT someone should have thought of that prior to getting rid of them.

Does the HOA intend to read, bill and collect from now on?

Something to consider. I am in the process of eliminating water meter billing for a senior condo I manage. The billing company never did it correctly, but there is a bigger issue, meter re-certification, which has to be done every ten years in California. The complex is coming up on ten years and it will cost to $107K to have 107 units re-certified with the County Weights and Measures. We have the CCRs at the attorney's office to amend to eliminate any mention of water meters and water billing. We finished a survey last weeks and 98% of owners have already pre-approved the association changing the language in the CCRs. While it seems to be a great idea to sub meter and pay for just what you use, it comes with a very high price tag.
VictorN2 (California)
Posts: 12
Posted:
Thank you very much for the advice. The board member wanted to do the back billing the 7 months that the billing company wasn’t doing their job. The board member wanted to recoup the money that was lost due to the hoa still having to pay the city for the water. The members voted to get rid of the submeters and added a fee to the hoa bill for the future.
MaxB4
Posts: 3,513
Posted:
If the members voted to include water in their monthly assessments, that would be perfect. To recoup the monies, I would do an emergency special assessment and bill the homeowners their share of the water since you supposedly have the readings. Make a payment plan no longer that say 3 months.
AugustinD
Posts: 1,027
Posted:
Quote:
Posted By VictorN2 on 08/17/2022 12:33 PM
The members voted to get rid of the submeters and added a fee to the hoa bill for the future.
I will assume that this was a bona fide vote to amend the CC&Rs. Or maybe your HOA is winging it.

What foolish owners. Now the incentive to conserve water is greatly diminished.

Just saying for the archives.
MaxB4
Posts: 3,513
Posted:
Quote:
Posted By AugustinD on 08/17/2022 1:38 PM
Posted By VictorN2 on 08/17/2022 12:33 PM
The members voted to get rid of the submeters and added a fee to the hoa bill for the future.
I will assume that this was a bona fide vote to amend the CC&Rs. Or maybe your HOA is winging it.

What foolish owners. Now the incentive to conserve water is greatly diminished.

Just saying for the archives.

Actually, based on the costs of maintaining the meters, no it is not foolish. How long do you think it will take to re-coup $450,000?
AugustinD
Posts: 1,027
Posted:
Assumes facts not in evidence.
MaxB4
Posts: 3,513
Posted:
Quote:
Posted By AugustinD on 08/17/2022 2:26 PM
Assumes facts not in evidence.

Do you actually what the true costs of maintaining a sub metering system? Yet you state the owners are foolish. Based on what, your vast experience, you can make that type of call?

Welcome back!
AugustinD
Posts: 1,027
Posted:
MaxB4, I cannot tell if you are suggesting the cost of maintenance is $1000 per sub-meter per year, or whether you are maybe talking about a full replacement costing $450,000.

Do you wish to discuss a hypothetical where the annual fee is $1000 per sub-meter per year?

Or do you wish to discuss the possibility that this HOA's sub-meters now require full replacement?
MaxB4
Posts: 3,513
Posted:
This is not a hypothetical situation, as I do business in the State of California. Per California Code of Regulation Title 4, Division 9, Chapter 3, Article 1, Section 4070, sub meter must be re-certified every 10 years. Some counties may required 10% done every year. The cost to pull, take to Weights and Measures, get them re-certified, picked up after 4 months and re-installed is $1000.00 each. The cost for the OP is $45,000 a year or $450,000 every 10 years. In addition, the meter may need to be replaced after the ten year period.

Utility billing companies will charge upwards of $10.00 per unit to bill homeowner with many times the HOA picks up half the cost.

So please explain to our audience how cost savings by homeowners is going to make up for the 10 year maintenance cost?
VictorN2 (California)
Posts: 12
Posted:
That was one of the reasons the board wanted to get rid of the submeters
AugustinD
Posts: 1,027
Posted:
You are kvetching about a $100 per year per sub-meter maintenance cost, that each owner of a unit (and not the HOA) will have to pay. You are in favor of not sub-metering. Subsequently owners and their tenants have near zero incentive to conserve water.

This is with this HOA located in drought stricken California. This is with the legal battle about allocation of water to the sub-basin states having just begun. This is with the cost of water expected to go up much more rapidly than usual. Meanwhile, per your plan you want the HOA to have to somehow compel conservation of water, while being responsible for the entire water bill. The labor it takes to compel this conservation of water will cost the HOA in other ways. Like the labor of management performing commode tank checks.

That the owners made a good financial decision is not clear to me.

I expect time will tell more, and sooner rather than later.

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