Topic No. 356: Tenant Challenge of Improper Water Revenue Bond Passthrough

A landlord who pays for water used by the tenants may pass through to the tenants 50% of certain water bill charges resulting from the issuance of Water System Improvement Revenue Bonds. The method for calculating a Water Revenue Bond Passthrough is specified in the Rules and Regulations. Landlords are required to use a worksheet provided by the Rent Board to calculate the amount of the passthrough.

In order to impose the passthrough, the landlord must give the tenant a written notice of rent increase as well as a completed Water Revenue Bond Passthrough worksheet. The landlord is not required to file a petition to seek approval of a Water Revenue Bond Passthrough. However, if a tenant believes that the passthrough is improper, the tenant may file a petition to challenge the passthrough within one year of its effective date. A Water Revenue Bond Passthrough may be improper for one or more of the following reasons:

  • The landlord has not properly calculated the passthrough;
  • The passthrough is calculated using an incorrect unit count;
  • The landlord failed to provide a clear written explanation of the charges and the calculation of the passthrough;
  • The tenant’s unit is not in compliance with applicable laws requiring water conservation devices;
  • The tenant requested a copy of the applicable water bills and the landlord has not provided them;
  • The tenancy began during or after the billing periods included in the passthrough calculation;
  • The landlord failed to discontinue the passthrough after it was fully paid.

If payment of the Water Revenue Bond Passthrough would present a financial hardship for a tenant, he or she may seek relief from payment of the passthrough by filing a Tenant Financial Hardship Application with the Rent Board. A Tenant Financial Hardship Application must be filed within one year of the effective date of the Water Revenue Bond Passthrough. Once the tenant has filed the Hardship Application, the tenant does not have to pay the Water Revenue Bond Passthrough unless the Rent Board issues a final decision denying the Hardship Application. If the Hardship Application is denied, the tenant will have to pay the Water Revenue Bond Passthrough retroactive to the date indicated in the rent increase notice. If the Hardship Application is granted, relief from payment of the Water Revenue Bond Passthrough may be for an indefinite period or for a limited period of time, depending on the nature of the tenant’s financial hardship.

To obtain a copy of the Tenant Petition form or the Tenant Financial Hardship Application, you can visit the Forms Center on our website at www.sfrb.org. These forms are also available at the Rent Board’s office.

 

November 2016