Earlier this year a small group of rental property owners brought a concern to the City’s Water & Wastewater Utility committee. They told us about a problem they’ve dealt with for some time. It turns out there was a flaw in the billing process. A few unscrupulous renters were exploiting this flaw to essentially pay nothing for their water and wastewater services and instead shift those bills to the property owner at the end of the year.
Water and Wastewater aren’t regular City departments like Police or the Clerk’s office. They’re municipal utilities, so they’re funded through user fees instead of tax revenues. Wisconsin statues and Public Service Commission regulations are fairly comprehensive in defining how a municipal utility must operate. Rhinelander adheres to all those rules with our policy of placing unpaid utility bills on the tax bill. Most communities around the state operate this way.
When those property owners brought the problem to our attention, I was genuinely surprised by both the cleverness of the exploit itself and the brazenness of actually using it. It takes a lot of chutzpah for a renter to stick it to their landlord like that. But unfortunately, that’s one of the risks inherent in the system the State and the PSC have established.
That state-wide framework provides that our municipal utility service is the financial responsibility of the owner of the property where the service was delivered. A set-up like that protects the utility itself, and ultimately all that utility’s customers, by providing the tax bill as a means to recover delinquent accounts. It’s pretty simple, pretty straightforward. The biggest problem with it is that it doesn’t really line up with the way properties are often rented.
Many properties, not only in Rhinelander but around the Northwoods and around the state, are rented under agreements where the renter is responsible for procurement and payment of utility services. That’s a perfectly valid arrangement. After all, renters are mostly responsible for creating those expenses by using those utilities.
Resolving these two different ideas about who’s responsible for utility bills is the heart of a recurring discussion item for the Water & Wastewater Utility committee. The State/PSC system protects our utilities, but sometimes that’s at the expense of the owners of rental properties. In the end it’s those landlords who are the utility’s customers, with the tenants being the landlords’ customers.
It’s perfectly reasonable that we should try to make some common sense adjustments to help make the system work well for all our customers. Unfortunately, all the options we’ve considered to this point introduce problems at least the equal of the one we’re hoping to resolve. It’s an issue that’s not likely to fade away. We’ll be revisiting it again at our next Water & Wastewater meeting, and probably every meeting after that until we have a billing scheme that balances everyone’s needs.