Alternative Solutions for RUBS in North Carolina for Property Managers

RUBS Alternative for Property Managers and HOAs in North Carolina

Managing utilities in multi-family properties can be a challenge, and many property managers turn to Ratio Utility Billing Systems (RUBS) as a solution. However, in North Carolina, RUBS is prohibited for residential properties. Let’s explore why this method isn’t allowed, the legal implications for property managers and HOAs, and look at alternative solutions that ensure fair utility billing while staying compliant with the law.

Understanding RUBS and Its Legal Challenges in North Carolina

Ratio Utility Billing Systems (RUBS) distribute utility costs based on factors like unit size or occupancy rather than actual usage. In North Carolina, this method is banned for residential properties due to concerns over fairness and accuracy, leading to strict regulations and legal challenges for property managers who attempt to use it.

RUBS allocates utility costs based on factors like unit size or occupancy, rather than actual usage, leading to discrepancies in billing. This method often results in tenants being charged for more than what they actually consume, raising fairness concerns and potential overcharges. 

As a result, the North Carolina Utilities Commission (NCUC) determined that RUBS does not meet the state’s standards for accurate and equitable billing practices, prompting the prohibition of its use in residential properties.

The ban on RUBS isn’t just a tenant issue- it poses significant challenges for property managers and HOAs as well.

Cost Recovery Issues for Property Managers Due to RUBS Ban

Without RUBS, property managers may face challenges in fully recovering utility costs, particularly if they continue using outdated or bulk billing methods. Without accurate billing, property owners often absorb the difference between actual utility costs and what is collected from tenants. This can lead to significant revenue losses over time, especially in larger properties with substantial utility expenses.

For instance, without a system that accurately tracks each unit’s consumption, property managers may unintentionally undercharge tenants, impacting the property’s overall profitability. Additionally, tenants may become dissatisfied with flat-rate or estimated billing, feeling they are unfairly subsidizing the usage of others, leading to disputes or increased turnover.

Legal Implications for Property Managers and HOAs in NC

Here are some potential legal implications of violating RUBS policy:

  • Fines and Penalties: Non-compliance with utility billing laws can result in hefty fines from the NCUC.
  • Reputation Damage: Violating state regulations can harm a property manager’s or HOA’s reputation, affecting future leasing and tenant relations.
  • Legal Action: Tenants can file lawsuits for overbilling, potentially resulting in costly settlements.

Alternative of RUBS in North Carolina

If RUBS is off the table, what are the alternatives for HOAs and property managers in North Carolina? 

Fortunately, one solution provides a transparent billing method that complies with state laws.

Introducing Smart Water Submetering: A Legal and Effective Solution

Smart water submetering is one of the most effective alternatives to RUBS. It gives property managers and HOAs the ability to remotely monitor water usage for each unit and provide accurate data that makes utility billing transparent and fair. Since smart submetering solutions directly measures usage, it aligns with North Carolina’s regulations, offering a compliant way to allocate utility costs.

These system creates a win-win situation for both property managers and tenants, fostering trust while ensuring compliance with North Carolina’s strict utility billing laws.

Why Water Submetering is better than RUBS

Smart water submetering directly measures each tenant’s water usage by installing individual meters for each unit. This method ensures accurate, transparent billing compared to RUBS, which allocates utility costs based on estimates.

Aspect

Smart Water Submetering

RUBS (Ratio Utility Billing System)

Billing Method

Charges tenants based on actual, metered water usage.

Allocates water costs based on unit size, occupancy, or estimates.

Accuracy

Highly accurate, since each tenant pays for what they consume.

Less accurate, as charges are estimated and not tied to direct usage.

Fairness

Fair for tenants, as bills reflect actual consumption.

Can result in unfair billing, with low-usage tenants paying more than they use.

Tenant Satisfaction

Generally higher, as tenants feel charges are transparent.

Often lower, with tenants disputing charges they feel are inaccurate.


Cost Recovery

Ensures full recovery of water costs, as tenants are billed for actual usage.

May lead to under-recovery of costs due to estimation inaccuracies.

How DuneLabs Submetering Solution Addresses Utility Billing Needs in North Carolina

For property managers and HOAs looking for a smooth transition away from RUBS, dunelabs.ai offers an advanced water submetering solution tailored to North Carolina’s regulatory landscape. 

Some of the most useful features of DuneLabs Water Submetering Technology are: 

  • Remote Monitoring: Measure and track all water usage events for each unit.
  • Connected IoT Technology:  Communicate usage information to Dune’s backend platform to provide remote monitoring and automated water usage information.
  • Analytics and Leak Detection.  Identify water use anomalies and provide actionable insights to reduce water use and waste.
  • User-Friendly Dashboard: Provides clear data for both property managers and tenants, making billing simple, accurate and fair.
  • Compliance: Designed to align with state laws, ensuring that your property management practices stay within legal limits.

DuneLabs makes it easy for property managers and HOAs to adopt water submetering. Their team can help you communicate with tenants, install the technology, train your staff, and ensure you’re set up for seamless utility billing that complies with North Carolina’s regulations.

FAQs

Why is RUBS prohibited in North Carolina?

RUBS is prohibited because it estimates utility costs based on factors like unit size or occupancy, rather than actual usage, leading to inaccurate and potentially unfair billing. North Carolina regulations prioritize transparency and fairness in utility billing practices.

What is water submetering?

 Water submetering involves installing individual meters that track each tenant’s actual water usage. This data is monitored in real-time, allowing for precise billing, compliance with regulations, and greater fairness for both property managers and tenants.

How does submetering improve tenant satisfaction?

Submetering ensures tenants are billed for their actual usage, eliminating the guesswork and disputes that come with estimated billing methods like RUBS. This transparency helps build trust, reduces complaints, and fosters better relationships between tenants and property managers.

What are the legal risks of using RUBS in North Carolina?

Using RUBS for residential properties in North Carolina can lead to fines, legal disputes, and potential damage to a property manager’s reputation. State regulations require accurate billing methods like submetering to comply with utility billing laws and avoid penalties.

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