Ohio Submetering Legislation

Pending Ohio Submetering Legislation: A Statement from Guardian Water & Power, Inc.

Apartment submetering conserves natural resources, lowers resident total housing costs and reduces property operating expenses. To preserve the long term viability of the Ohio submetering industry, we believe it is fundamentally important to provide sound consumer protection safeguards while allowing apartment owners to recover all resident utility costs. Recent articles in The Columbus Dispatch raise concerns about the billing practices of a small number of central Ohio submetering companies.

Guardian urges Ohio lawmakers to enact submetering legislation that incorporates “best billing practices” as specified by the Utility Management and Conservation Association. UMCA is a national trade association representing submetering vendors and equipment suppliers. UMCA best practices state that “the total amount billed to the end-user [apartment resident] does not exceed what is billed by the [utility] provider… [after deducting all late charges, interest, or other penalties owed by the property].” UMCA best practices also state, “Administrative and billing fees should be reasonable. Any billing or administrative fee should be mutually agreed to in writing between client [apartment owner] and end-user [apartment resident]”. Simply stated, charges billed to apartment residents should not exceed actual costs billed by the utility provider to the property (less penalties), plus reasonable administrative fees. In keeping with other state submetering statutes, Guardian would add common area charges as a deduction from the property utility costs.

Legislation that proposes to establish local single-family residential rates as the basis for billing apartment residents does not conform to UMCA guidelines. Billing apartment residents at the single-family rate will, in aggregate, yield more revenue than the property’s actual costs from the utility provider. This is because the property utility rate is lower than the single-family residential rate. In contrast, UMCA best billing practices result in lower resident bills than the local single-family rate and still allow the property to recover all utility expenses. UMCA guidelines go on to say that entities billing more than actual costs would be subject to regulation.

Again, we urge Ohio lawmakers to enact submetering legislation that conforms to UMCA best billing practices.

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