Electric Enigma

[joer1212]

I have a 3-family rental in Massachusetts.

I've been paying electric for one of the Section 8 tenants on the second floor, but decided that, instead of raising her rent, she will pay her own electric starting on June 1.
So, I sent her a letter, along with a new lease for her to sign. She signed it and promptly mailed it back, and I forwarded a copy to Section 8. No problems.

Yesterday morning, I received a phone call from Section 8. I was told that the tenant feels it's unfair to pay for her own electric, because the basement electric and common areas (hallways, front porch) may be attached to her unit (Mind you, I live hundreds of miles away in Brooklyn, so I rarely will be using the electric in the basement).

I told Section 8 that I will have to speak with my brother (my business partner) and get back to her, as he's the one who deals with the tenants directly.

So, we've discussed it, and none of our options seem that good.

1) We can call an electrician and have the whole house rewired. This will be expensive and time-consuming, so not a good option.

2) We can call an electrician and, hopefully, he'll tell us that the electric is not attached to this tenant's unit (it probably isn't; the 1st floor might be). This would solve the issue, but it would be kicking the can down the road, so to speak, as it would transfer the problem to the other tenant(s), who are also paying for their own electric.

3) We could tell Section 8 that we're not budging because this tenant pays below market rent ($750/mo, as opposed to several of our other tenants who pay over $900 for similar units). The thing is, is this legal?

Any input is greatly appreciated.

Thanks

[Fishingmn]

Need more info - how much is her electric bill?

Why not just go back to the option of raising her rent and you keep paying it as before?

[joer1212]

Need more info - how much is her electric bill?

Why not just go back to the option of raising her rent and you keep paying it as before?

Her electric bill has varied between $50-$135.
I would prefer not to deal with the headache of managing electric bills, and also worrying that my tenants may go to town with their usage (Massachusetts is a legal marijuana state. Residents are legally allowed to grow at least 6 plants indoors with high-voltage electric lights, which can drive up our electric bill).

[Boll weevil]

First thing would be to figure out if that other stuff is actually on her circuits. Flip the breakers one by one and see what no longer works. You don’t need to be an electrician to do that (unless there are special laws for landlords).

Second thing is do you really need to re-wire the entire house? I would think you could run wires for any new circuits, but either cap off or splice and otherwise leave the other existing wiring (or is this prohibited by code?)

Could you compromise on any exterior lighting by installing LEDs or other super efficient lighting to show that you’re minimizing her costs?

But I also can also see there’s a potential issue to make the tenant pay for heating in the basement. It’s not clear from your posts what that entails (ie how big is the basement, how well insulated are the areas she would be paying for heating), and even if you aren’t there, you’ll want to make sure that things are kept at a reasonable temperature so that the pipes don’t freeze (on the other hand, maybe argue she benefits by not having frozen pipes).

[uniwelder]

First thing would be to figure out if that other stuff is actually on her circuits. Flip the breakers one by one and see what no longer works. You don’t need to be an electrician to do that (unless there are special laws for landlords).

Or even better, flip the main breaker for their panel and eliminate testing all the individual circuits.  Tenant should be without power for no more than 5 minutes.

I understand you're long distance, but you mentioned your brother dealing with tenant issues, so agreeing with Boll weevil, this is pretty easy to do.

[nereo]

I second the weevil

Find out which circuits are controlling the basement and the common areas. That’s easy, and free to do.

LED lighting uses virtually no electricity. Even if a light is left on 24/7/365 it will draw just a few kilowatts (eg 4.4 kw for a standard 6watt LED common for a front entrance. That’s roughly 50¢ per month

What else might be drawing electricity in those areas?

[ChpBstrd]

I’d say just redo the lease (voiding the previous agreement) so that the rent goes up and electric continues to be landlord-paid. If you are worried about grow operations, just put a clause in the lease prohibiting it or requiring a surcharge like you do for pets.

Alternatively, you could show the tenant a 12 month record of the electric bills in question so that the tenant can quantify their risk of overpaying for juice or having surprise cash flow issues. Communication is the easiest option and might resolve the whole affair.

[srad]

I agree with others that you just need to test and see what is on her circuit. I'd also change out everything to LED., its literally your money you are spending each month. 

If you are concerned about a grow operation, add an addendum to your lease stating no growing. 

Regardless on the electrical, if you are under rent, especially on a Section 8.  You need to raise it.  Not sure if you have any rent controls in your area or if Sec8 does, but I'd give her at least a $50 raise this year and another $50 next, followed by another the following year.  You need to get this close to market rate.

[cooking]

I would prefer not to deal with the headache of managing electric bills

[/shadow]

If you got an electrician to separate the circuits for the common areas from her circuits, you'd then be adding a nitpicky-type annoyance to your management duties.  You'd end up getting an electric bill in your own name for the common areas every month which you'd have to set up, and then pay for monthly.  You might rightly think it kind of a PITA.