In the majority of new apartment and multi-family residential buildings and complexes, individual submetering provides accurate billing for each individual unit based on actual water use.
However, in older buildings, or in buildings converted from a single residence to multi-family units, it may be difficult to complete submetering. There may be very complex plumbing systems which may have the main lines into the units in very hard to reach places. In these types of situations, the cost of installing the smart meters and the amount of disruption it would cause tenants may not make it a cost-effective option while the units are occupied.
In these situations, a ratio utility billing system is the preferred fallback option. These types of systems are widely used when submetering is not available and offer a much fairer option than simply splitting the total water bill based on the number of units.
How It Works
The ratio utility billing system uses a formula which may vary slightly from application to application. Most residential properties use a formula that includes the square footage of the individual unit combined with the number of adult tenants.
A ratio utility billing system, sometimes known as RUBS for short, does tend to favor the high users as they will pay the formula rate based on the full building usage. The lower volume losers often feel unfairly taken advantage of as they realize they may be paying more for water than they are actually using.
Overall, having a RUBS in place is a much more effective option for tenants compared to simply dividing the total bill between the units. It does require some consideration and landlord does need to consider how to set up the system to fairly bill the tenants based on a clear formula.