Colorado’s HB25-1090 is shaking up rental billing rules, and landlords need to pay attention. The 2025 law bans hidden fees, enforces price transparency, and challenges old systems like RUBS. Whether you submeter water or not, how you bill tenants is about to change—and accuracy now matters more than ever
What is HB25‑1090 and Why It Matters
HB25‑1090 is Colorado’s 2025 “junk fees” and price-transparency law. It requires landlords to clearly present the total price of a rental (including mandatory charges) and bans deceptive or hidden fees. While the statute doesn’t force landlords to install water submeters, it materially affects how you bill for utilities if you do submeter or allocate costs. In practice, this effectively ends the use of RUBS (Ratio Utility Billing System) in Colorado, since RUBS allocations don’t reflect exact usage and would not meet the law’s disclosure and fee‑cap standards. The goal: tenants pay what’s disclosed and owed—nothing more—and they can spot the full cost up front. This shift impacts how you structure leases, advertise units, and recover operating costs.
Key Provisions of HB25‑1090
Water Submetering Requirements
Before diving into the details, it’s important to note that HB25‑1090 draws a bright line: transparency and accuracy matter more than the specific billing method. Here’s what that looks like in practice:
- No statewide submeter mandate. You’re not mandated to install water submeters. That said, submeters can still help you better aling with the law, while not losing out on revenue: they provide accurate, unit‑level billing that aligns neatly with HB25‑1090’s transparency rules, can reduce disputes, and may encourage conservation that lowers total water expenses.
- If you submeter or allocate: bills to tenants must reflect actual, disclosed charges. Advertising and lease terms must show the total price (rent + any unavoidable, mandatory fees) as a single number more prominently than any other pricing.
- Pass‑throughs vs. markups: If you’re billed by a third party (e.g., a utility or billing service), any added markup/fee in a lease is capped at the lesser of 2% of the billed amount or $10 per month—and you can’t charge both. Noncompliant add‑ons are prohibited.
Ban on Junk Fees
The law also targets so‑called “junk fees,” ensuring that landlords cannot hide unrelated costs under utility labels. In practice, this means:
- No disguising CAM/common‑area costs or other landlord expenses as “utility” charges.
- No unrelated admin/bundled fees under a water label. If a charge isn’t part of the actual, disclosed utility cost—or exceeds the allowable small admin markup—it risks violating the law.
- Clear, conspicuous disclosures are required across ads, websites, and lease materials.
Timeline and Compliance Deadlines
Here’s what landlords need to know about timing and compliance:
- Effective date: January 1, 2026. The new rules apply to any billing, advertising, or lease conduct that happens on or after that date.
- Existing leases: Make sure any new or renewal leases signed going forward meet the standards. For leases already in place, review fee language now and remove or adjust anything that won’t be legal once you start billing in 2026.
- Rulemaking/enforcement: The Attorney General can issue additional rules, and tenants themselves can take action if landlords don’t comply. Penalties can increase if you don’t fix problems after getting notice.
Implications for Colorado Landlords
- Financial: Budget for (optional) submeter installs only if they pencil out; you can no longer rely on opaque fees to offset costs. The small, capped admin fee may not cover all billing overhead—optimize operations accordingly.
- Legal risk: Noncompliant fees (e.g., CAM passed off as “water,” hidden admin charges, or markups beyond the cap) invite tenant demands, interest penalties, and litigation risk.
- Operational: Update marketing, unit listings, websites, and leasing workflows so the total price is front and center. Align your billing vendor outputs with lease terms and disclosure standards.
- Reputation: Transparent, usage‑based billing can improve trust and reduce disputes—especially for low‑usage tenants.
How Tenants Benefit from HB25‑1090
Here’s how tenants in Colorado specifically benefit from the implementation of HB25-1090:
- Upfront clarity: Tenants see a single, total price before they apply.
- Fair utility billing: Charges are tied to disclosed, actual costs rather than padded or bundled fees.
- Conservation incentives: Submetered tenants typically reduce consumption when they see precise usage—benefiting both the tenant’s bill and local water resources.
- Stronger protections: Clear remedies if landlords misrepresent prices or tack on prohibited fees.
Next Steps for Landlords
1) Audit Current Billing Practices
- Pull 12 months of utility and billing‑service invoices.
- Compare tenant charges to actual costs; identify any CAM, admin, or convenience fees embedded under “utilities.”
- Flag lease language that allows markups beyond 2% or $10/mo (or both)—and remove/replace.
2) Plan for (Optional) Submeter Installation
- Business case: Model payback using historic usage, expected conservation (often 10–20% with metering), and vendor pricing.
- Scope: Prioritize buildings where stacking risers or existing plumbing makes installs efficient.
- Vendor due diligence: Require accuracy specs, installation warranties, maintenance SLAs, and data‑export formats that match your billing stack.
- Policy fit: Ensure your submeter program and lease riders reflect the total‑price rule and the admin‑fee cap.
3) Communicate with Tenants
- Send written notices explaining any billing changes, how submeters work (if used), and where total price appears in ads and in the lease.
- Provide sample bills and a plain‑English glossary (usage, meter read date, rate, fees).
- Offer a contact path for disputes and publish a simple cure process.
4) Evaluate Water Submetering Options
- Why consider it: Even though HB25‑1090 doesn’t explicitly require submeters, they can make compliance easier and give tenants confidence that they’re only paying for what they use.
- Practical benefits: Accurate unit‑level tracking reduces disputes, encourages conservation, and can lower overall water expenses.
- Solutions to explore: Providers like Dunelabs offer modern water submetering systems designed for accuracy and ease of integration. For landlords evaluating upgrades, check their water submetering solutions to see how they might support compliance and tenant transparency.
Conclusion
HB25‑1090 reshapes pricing and disclosure—not plumbing mandates. If you’re submetering water, keep it: it can promote fairness and conservation. But starting January 1, 2026, Colorado will judge your program by transparency and accuracy. Audit leases and billing now, align fees with the statute’s caps and disclosures, and communicate clearly. Do that, and you’ll stay compliant while building credibility with residents.
FAQs
Is water submetering mandatory under HB25-1090?
No. HB25-1090 doesn’t mandate submetering, but it emphasizes transparency and accuracy. Submeters can simplify compliance by providing precise, unit-level billing aligned with disclosure rules.
Can landlords still use RUBS (Ratio Utility Billing System)?
Practically no. RUBS allocations estimate usage, which conflicts with HB25-1090’s requirement for accurate, disclosed billing. Most landlords will need to move toward metered or direct-cost models.
What are the penalties for non-compliance?
Landlords may face tenant legal action, refund demands, or fines. Continued violations after notice can increase penalties, especially if deceptive billing practices persist.