Is the water bill the landlord’s responsibility or the tenant’s? The answer seems to be as elusive as the one to the age-old question: Which came first… the chicken or the egg? But, I assure you, there is a definitive answer.
Unless otherwise stated in the lease, the water (or water/sewage) bill falls under the utility umbrella. So if the lease says, Tenant is responsible for all utilities associated with Property, then the water bill is their responsibility. If the lease denotes that water is built into the monthly rent charge then, obviously, the water bill falls on the landlord’s shoulders for payment.
But what happens when the tenant doesn’t pay their water bill? They move out… and you’re stuck with a sizable amount for their past due H2O. This is where it gets sticky.
Since in many municipalities, water (or water/sewage) is owned by the city and not by a private utility company, the city does have the power to put a lien on your property if the bill isn’t paid. Think of it in terms of if you let your friend borrow your car and they zip past a speed camera, initiating a speeding ticket. If they didn’t pay the fine, it would ultimately become your responsibility as the titled owner of that vehicle. You could go after the former tenant by way of a civil suit, but you would have to satisfy the water company’s lien before another tenant could move in.
A lien against your property isn’t a matter to brush off lightly. You could ultimately lose your property if you refuse to pay and the utility company pursues action against you in court. Just this spring, an Atlanta landlord was left with a $19,000 water bill after a tenant moved out. The landlord was informed that if she didn’t pay the balance, they were going to put a lien on her property.
If you want to avoid the delinquency issue all together, pay the water bill for the property and factor the average cost per unit in with the monthly rent charge. This way you are certain the bill is paid and that you aren’t stuck holding the bag.
Depending on your state’s laws, you could add a clause to your lease that states the security deposit will not be returned until all utility bills are paid in full. You could also ask the utility company to notify you when the water bill is more than 30 days overdue in order to avoid any surprises.