ELECTRIC BILL AND THE RESIDENT
In most annual rentals, the resident is responsible for paying the electric bill. In addition to being responsible for paying the bill, the resident is often given instructions by the manager and agrees in the lease agreement to place the electric bill into her name upon move-in. This requires the resident to make a call into the electric company and/or go to the electric company office to give the relevant information and pay a utility deposit, which varies by company providing the electric. In a perfect world, the resident does just that. Prior to move-in she gets the electric placed into their name and pay the bill. What happens when she does not pay the bill? In many places, the electricity is simply shut off, and the resident is without electricity. This is the resident’s problem, and no liability to the manager occurs. The resident may then pay the bill and have it reconnected, steal the electricity from an adjoining resident, put jumper wires on the electric meter, or completely live without electricity. In some areas of Florida and in many apartment communities, the electric will revert back into to the name of the apartment community, and the apartment community will later be notified that this has occurred, sometimes weeks later. This is to prevent a unit from being without electricity. While we cannot control what the resident is “supposed” to do, we can take action, but must be careful that we do not fun afoul of the law.
Florida Law and the Electric Bill
Florida law specifically states that a manager shall not directly or indirectly cause interruption in the resident’s electric service.
FS 83.67 Prohibited practices. (1) No manager of any dwelling unit governed by this part shall cause, directly or indirectly, the termination or interruption of any utility service furnished the resident, including, but not limited to, water, heat, light, electricity, gas, elevator, garbage collection, or refrigeration, whether or not the utility service is under the control of, or payment is made by, the manager.
Direct interruption would be when the manager shuts the electric off by actually disconnecting it from the rental unit (this is rarely done but happens!), or more commonly instructs the electric company to shut the electric off. A manager who discovers that the resident has not placed the electric in the resident’s name could easily feel that it is correct to tell the electric company that the electricity is not to be in the name of the manager, but rather that it must be in the name of the resident. However, this can lead to a direct shut off. Further, the manager may have had the electric bill revert back into the manager’s name, as is often the case in apartment communities; notifying the electric company that this is not proper and that it should be in the resident’s name will result in a direct shut off to the resident. In the single family home setting, sometimes the property owner who lives out of state receives an electric bill, becomes furious, and calls the electric company for a shut off. Does it seem fair to the manager who now is stuck paying the bill? No, but we never said the law was always fair.
An example of indirect interruption occurs if the manager receives an electric bill on an account that should have been in the resident’s name, and the manager simply fails to pay it. Here the manager has full knowledge that the resident failed to place the account in his or her name, and by the manager not paying it, the account will get shut off. Again, this seems unfair to the manager, but it is the law.
Steps to take if it is discovered that the resident is not paying the electric
Once it is discovered that the resident is not paying the electric bill, the resident needs to be notified immediately by the use of a 7 Day Notice of Noncompliance with Opportunity to Cure. The notice may state the following:
You have failed to place the electric utility service account into your name as required by your lease agreement, and you owe the manager the sum of $__________ at this time for outstanding electric bill(s).
Other Steps the Manager Can Take
While it is beyond the manager’s immediate control if the resident steals electric, or in the event of reversion of the account back to the manager, there is one thing that often occurs which is indeed completely in control of the manager, but is often missed, because of the manager’s forgetfulness or misplaced trust that the resident will do what the resident is “supposed” to do. Due to the need for electric to operate a/c units, most managers do not wish to have a time period when the electric is off. The result is that the electric is in the manager’s name until such time as either the manager directly has it shut off, OR the resident directly has it placed in the resident’s name. When a resident moves into a rental unit and the electric is on, they will often happily sit there until the electric is shut off. But wait. How can the manager have it shut off? Did not we just say that was illegal? The answer lies in timing. If the resident is notified in writing that the manager will be taking the electric out of his or her name no later than a fixed date, and the manager does indeed do this, it is doubtful that a prohibited practice or indirect termination as envisioned by the statute will occur. We recommend the following wording in a notification to be given to the resident prior to move-in. This can be placed directly on the INFO SHEET that the resident should receive from the manager, stating the names, phone numbers and addresses of the utility company, garbage pick up days, etc.
Here is some recommended wording:
Resident understands and agrees that the electric service is currently on in the apartment community’s name. Resident agrees that the Manager shall order the electric service be taken out of the name of the apartment community within 3 days, and Resident shall place the electric service in Resident’s name and pay all necessary deposits.
So you notified the resident prior to move-in. Now, don’t forget to notify the electric company immediately in writing, and get a confirmation from them!! Property managers who use checklists rarely if ever forget to do this.
- The Curable Noncompliance Examined PART 1
- THE CURABLE NONCOMPLIANCE EXAMINED PART 2
- THE WRIT OF POSSESSION – WHAT IT IS
- THE WRIT OF POSSESSION AND THE FULL UNIT
- WORK ORDER COMPANY POLICY AND THE LAW