You should let both of them know that they are both responsible as they both signed the lease.

In any deal/investment that goes south like this, your/buyer's side is responsible bc "buyer beware" is as old as time.

There was also a failing retaining wall in the rear of the property that completely blocked natural light form a handful of houses, and was technically on the property line and a shared responsibility.

On the renewal for the license, I asked if the loft was considered a bedroom and the response I got (unsurprising when it comes to taxes & fees!)

Also, her text response "I'm moving out" might have jut been an off-the-cuff comment and not a formal notice. 

Thanks for the response.

With this strategy, who would be responsible for utilities? 

Occupancy can be off the charts in places like this because there is so much activity or reasons for people to visit during what would be slow days of the week and off season months. 

He's an adult, he needs to take responsibility.

Just be mindful of the responses you get to your question.