Utility Allocation Policies & Procedures - Employee …

1 Milestone Management 03/2017 Utility Allocation Policies & Procedures This manual will cover the RUBS program including Allocation methods, addenda, and conservation. Utility Allocation Policies & Procedures 2017 2 Table of Contents Glossary of Utility Terminology .. 3 RUBS Program Overview .. 4 Regulation .. 4 United States Environmental Protection 4 Texas Public Utility Commission .. 4 RUBS Allocation Methodology .. 5 Exclusions RUBS and Sub-metering .. 5 Exclusions Sub-metering .. 5 Inclusions .. 5 Common Area Deduction Guidelines .. 5 TAA - RUBS Calculation Based on Average Occupancy for # of Bedrooms -Sample .. 6 NAA - RUBS Calculation Based on # of Bedrooms -Sample .. 6 RUBS Calculation Based on Actual Number of Occupants -Sample .. 6 RUBS Calculation Based on Square Footage and Number of Occupants - Sample .. 7 RUBS Calculation Based on Occupancy Ratio.

2 7 Service Providers .. 8 Life of a Utility Bill .. 8 Monthly Billing .. 9 Resident Statements .. 9 Convergent Billing .. 9 Data Verification .. 9 Billing Timeline .. 10 Prebill Report Policy and Procedures .. 11 AUM Prebill .. 11 ConService Prebill .. 11 Paylease Prebill .. 11 Utility Billing Reports .. 11 AUM 11 ConService Reports .. 11 PayLease Reports .. 11 Utility Monitoring Agency .. 12 Continuing Service Agreement (CSA) .. 12 Vacant Recovery .. 12 Lease Contract and Utility Addendums .. 13 Utility Billing Hi, Low, Average .. 13 Utility Addenda .. 14 Texas Utility and other RUBS Addenda .. 16 NAA Utility and Other RUBS Services .. 24 Utility Expense Management .. 27 Disconnection Policy at Move In (Electric/Gas) .. 27 Clubhouse Utilities .. 28 Conservation .. 29 Utility Support and Contacts .. 32 Extraordinary Usage of Water/Sewer .. 32 Disputed Electric/Gas Recovery.

3 32 Milestone Action Plan for Unexpected Interruption of Power (Electric or Gas) .. 33 Utility Allocation Policies & Procedures 2017 3 Glossary of Utility Terminology Allocation Allocation is the process of distributing an amount or portion of a resource to a particular recipient. As it relates to this course, Utility expenses are divided amongst residents by means of a RUBS formula rather than based upon their actual usage. Common Area Accounting for the common area Utility usage by a pass-through percentage amount deducted off the master metered Utility bill for the irrigation system, pools, vacant units, Continuing Service Agreement (CSA) Continuing Service Agreement for uninterrupted electric service upon disconnect of a resident s service. Deregulation Deregulation is the elimination of certain rules and regulations in a particular industry. As it relates to this course, deregulation of electricity and gas in certain areas of the country has offered more competition among Utility providers and more choices for consumers.

4 Meter A device that measures actual Utility usage or consumption. Resident Billing Statement Monthly bill sent by Service Provider to the resident each month detailing the current rent, utilities etc. due to the property. Statements can be mailed to alternate addresses or resident can go online and sign up for paperless billing. Ratio Utility Billing System Ratio Utility Billing System (RUBS) is a calculation method that uses a compensation factor to allocate Utility costs among users. Service Provider A company that provides billing services, either sub-metered and/or RUBS. Sub-metering The practice of using meters to measure master metered Utility consumption by individual users. Public Utility Commission (PUC) The Texas Public Utility Commission (PUC) regulates the Allocation and Sub-metering of water and wastewater in accordance with PUC rules and guidelines in Texas.

5 Many Utility program responsibilities were transferred from the Texas Commission on Environmental Quality (TCEQ) to the PUC in 2014. United States Environmental Protection Agency (USEPA) The United States Environmental Protection Agency (EPA or USEPA) is an agency of the Federal government of the United States which was created for the purpose of protecting human health and the environment by writing and enforcing regulations based on laws passed by Congress. Utility Used alternately to describe a provided natural resource commodity, such as water, gas or electric. Utility Monitoring Agency (UMA) A Partner Company to the Service Provider, the Utility Monitoring Agency is an accounts payable and Utility monitoring/auditing company. They directly receive property Utility bills from the local Utility and then fully audit and pay them. They then forward the data to the Service Provider to use for Vacant Recovery Billing, reporting, and on-line storage.

6 Vacant Recovery Vacant Recovery is the process by which electric or gas utilities are billed back to a resident if they do not have or keep service in their name while occupying the unit. Vacant Recovery amounts are calculated by the Service Provider and are billed back to the resident whenever possible. Units of Measure Standard amounts used to measure consumption of a natural resource commodity. - Water is measured in Gallons. gallons of water = 1 cubic foot of water. - Gas is measured in Therms. 1 therm of gas = 100 cubic feet of gas. - Electricity is measured in Kilowatt Hours. 1 kilowatt hour = 1000 watts of energy. Utility Allocation Policies & Procedures 2017 4 RUBS Program Overview Due to higher costs and limited resources, it s a rising trend to transfer the responsibility of paying for Utility services incurred back to the residents. Apartment residents are billed for utilities in two basic approaches, RUBS or Sub-metering, to allow each resident to take personal responsibility for resource usage.

7 Some community s residents are allocated through the use of a Ratio Utility Billing System (RUBS) method that allocates Utility costs via a mathematical formula. The total usage is measured as a master meter and then the bills are allocated according to the formula selected, which is a fair, equitable calculation. RUBS billing methods are used for many reasons, but primarily because the plumbing configuration on a particular property can make sub-metered installation difficult or impossible. Other community s residents are individually Sub-metered. This means each apartment home has its own water/gas/electric meter that is read by an outside company. The resident receives their bill directly from the outside company, and payment is made directly to them. Residents at Sub-metered communities will still receive a monthly statement however residents will not see monthly charges for water/gas/electric billing on their monthly statement.

8 Sub-metered communities will have their vacant recovery process supported by their Service Provider. The monthly upload from the Service Provider to Yardi will include all vacant recovery charges and fees. These vacant recovery charges and fees will also be included on the monthly resident statement, if applicable. Regulation Water Allocation is governed by agencies in order to ensure that all laws and state statues are being followed. United States Environmental Protection Agency (USEPA) favors water conservation and encourages an equitable method of distributing costs. Under USEPA, owners who bill residents are subject to state monitoring requirements under the Safe Drinking Water Act (SDWA). The main issue in each state is whether billing for water and sewer services is more than the Utility expense. The law in about 90 percent of the states is that a property owner may not charge more to all residents combined than they paid to the Utility company for the commodity and service.

9 RUBS programs are regulated at the state level and may also be regulated at the local level. Texas Public Utility Commission The PUC is the governing agency that regulates the Texas Law on the Allocation of Water/Wastewater with specific rules and guidelines. Texas is one of the few states that has addressed the water and sewer sub metering, RUBS Allocation and billing business in detail through state agency rules. Milestone models its Policies after the PUC guidelines. Utility Allocation Policies & Procedures 2017 5 RUBS Allocation Methodology From the retail public Utility invoice to the property, the owner has the ability to adjust the gross amount of the invoice that s billed back to the resident within the following guidelines. Exclusions are items that cannot be considered or charged back to residents. Exclusions RUBS and Sub-metering Deposits Disconnect/Reconnect Fees Late Fees Base Charges for vacant units Exclusions Sub-metering Customer Service Charges for vacant units Irrigation System usage Pool usage Laundry Room usage Inclusions are charges billed to tenants for sub metered or allocated Utility services.

10 Inclusions Gross Water and wastewater charges Base Charges for occupied units Customer Service Charges Customer Service Charges Vacant units on master meter Common Area Deduction GuidelinesBefore a property may allocate the retail public Utility s master meter bill for water and sewer service to the tenants, the following must be considered: If all common areas are separately metered or sub metered, deduct the actual common area usage If common areas that are served through the master meter that provides water to the dwelling units are not separately metered or sub metered and there is an installed landscape irrigation system, deduct at least a minimum percentage of the retail public Utility s master meter bill If all water used for an installed landscape irrigation system is metered or sub metered and there are other common areas such as pools or laundry rooms that are not metered or sub metered, deduct at least 5% of the retail public Utility s master meter bill.