Are unpaid utilities only a lien if they are city owned?

Question

All the utility bills for my properties are paid by the tenants, I want to make sure that if they stop paying them I won't be on the line for the bill, or at least I will be prepared and check the status. I can't find this information on the utility company websites, but in reading other BP posts it looks like only the utilities owned by the city can place a lien on your property if the tenant doesn't pay the bills, is that true? In Indianapolis the water and sewer is being sold by the city to an outside company which would mean there would not be any city owned utilities for my properties anymore so it would be nice if that also prevented the liens.

On a related topic, what do other landlords do to verify the bills have been paid? I contacted all the companies to try to have copies of the bills sent to me, but they do not offer that service. Will I be able to call them once the tenant moves out to confirm all the bills have been paid?

Michael Rossi · Answer

Unfortunately, I am an EXPERT in this field - the field of government corruption and tyranny, that is.  The bottom line is that government agencies and utilities can and do whatever they like - regardless of the law - UNLESS SOMEONE STANDS UP AND FIGHTS THEM!

Here in my local area, we have had ENOUGH!  A group of local landlords is in FEDERAL COURT fighting the bastards AND WE ARE WINNING!  We have also launched a campaign to kick the scumbags out of office and stop further tax increases.  So far, we have defeated a local tax levy; humiliated the mayor and assistant law director in local elections; caused 3 council members to choose not to run for re-election; and will unseat many others in November.

There is a WAR on business in this country.  If you plan to stay in business, it's time to FIGHT!

Steve Babiak · Answer

I purchased a rental in a town that out-sources their trash; this property was REO, and it had trash liens.  So just because something is out-sourced does not mean that there is no way to place a lien on the property.

One approach you can take to see whether a bill has been paid is to have the tenant bring you the actual current bill (or if you collect rent in person, you look at the bill in person).  The current bill always seems to show any past balances due ...  So you always want to see ZERO for the past balance due.

Another approach that some take is to make the tenant responsible for paying the landlord, and the landlord keeping the service in landlord's name.  Of course, when tenant skips out, the landlord gets stuck this way.

I'm glad to hear that MikeOH has been part of a successful battle against this practice of sticking the landlord for some utility's failure to collect payments from tenants who had the obligation of paying.  I'm hoping that something from mikeOH's legal battle can be used in my state to fight some of this crap.

Marc Freislinger · Answer

You can call the or fax in a request to the water company for a payment history. I never tried to get the bill sent to me as well as the tenant, but I doubt they'd do it. I don't know how much time you've spent on the phone with them, but they're mostly useless.

I don't know much about the sale, but my guess would be that it won't change.

I will add that we have a separate addendum to our leases that include water, that states what the average was over the past 6 months, and requires they pay any amount more than $20 over that.

Kyle Meyers · Answer

Marc,

Have you found a way to get copies of the bills sent to you? Glad to hear that the gas, electric, and part of the water bill stick with the tenant. I had hoped to include water in the rent, but as you mentioned it would cause my rents to look higher than the other available units.

Any idea if this will change with the water company being sold to Citizens?

Kyle Meyers · Answer

Mike,

Thanks for your input, your welcome back post was actually what led me to try to find out more about this. I found an article about your case online and it looked like it was based on an agreement the utility company had made a few years ago, I have been trying to find if there is a similar agreement that my utility companies have made. If you wouldn't mind sharing any more information you have on how it is that you were able to fight the charges being put back on the landlords I would really appreciate that. Also, were the bills that were being transferred to the landlords only from city owned utilities?

Welcome back, I enjoy reading your posts.

Marc Freislinger · Answer

In Indianapolis, they WILL lien your property for the unpaid waste portion of your water bill.

You have two options to ensure they are paid that I can see. One, wait for the city to send you the letter that the bill is unpaid, or two, pay it yourself and add it to your rent.

I actually wish more landlords in Indy would do number 2, so our rent doesn't look $50-100 over average because we include water.

Chris L. · Answer

Kyle,
I believe that this varies by locality.
In Fort Wayne, they do not attach unpaid utility bills to the property taxes.
You should check with your utility companies to determine the exact answer for your area.
Chris

Steve L. · Answer

Here it varies but for most my rentals the trash company is the only one that liens unpaid bills.

They usually send a letter letting the property owner know about the unpaid balance and that they will be placing a lien on the property in 90 days if they do not receive payment.

I simply forward this letter to my tenants.

Are unpaid utilities only a lien if they are city owned?

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