How do you calculate a RUBS bill by square footage, occupants or bedrooms?
Pick a formula, add up the factor for the whole building, divide the bill by that total to get a rate, then multiply the rate by each unit's factor. Square footage, occupants and bedrooms all work the same way. The decisions that cause trouble are the ones around the math: vacant units, move-ins mid-month and rounding.
What are the steps?
- Take the bill amount the utility charged the building for the period, the whole amount you may pass on under your state's rule and your lease.
- Choose the factor named in your lease: livable square feet, occupants, bedrooms or number of fixtures.
- Add the factor for every unit. This is the building total.
- Divide the bill by the building total. That is the rate per square foot, per person or per bedroom.
- Multiply the rate by each unit's factor. That is the unit's share.
- Add the shares back up and check they equal the bill, apart from rounding.
Example by square footage
Example a made-up four-unit building has a $600 water and sewer bill. The units are 600, 700, 800 and 900 square feet, 3,000 in all. The rate is $600 divided by 3,000, or $0.20 per square foot. The shares are $120, $140, $160 and $180, which add to $600.
Square footage is easy to defend because it does not change when a tenant has a guest. It ignores how many people live in the unit, so a large unit with one occupant carries more than its use.
Example by occupants
Example a made-up four-unit building has the same $600 bill and 1, 2, 2 and 3 occupants, 8 in all. The rate is $75 per person. The shares are $75, $150, $150 and $225, which add to $600.
This tracks use more closely but needs an occupant count. State what counts in the lease, such as people named on the lease or on the application, so a tenant's cousin who stays two weeks does not start a dispute. Whenever someone moves in or out, update the count and the date it takes effect.
Example by a mixed formula
Example a made-up building uses half occupants and half square footage on the same $600 bill. Half the bill, $300, is split by occupants at $37.50 per person, giving $37.50, $75, $75 and $112.50. The other $300 is split by area at $0.10 per square foot, giving $60, $70, $80 and $90. Each unit pays the two parts added together: $97.50, $145, $155 and $202.50, which add to $600.
A mixed formula softens the swings from either factor, at the price of a longer explanation. If you use one, print the two parts on the bill.
How do you handle vacancies, move-ins and rounding?
Write these rules into the lease before the first bill, not after the first complaint.
- Vacant units: decide whether the owner absorbs the vacant unit's share or counts it with a fixed occupancy. Charging occupied units for a vacant unit's use is the quickest way to a complaint.
- Mid-month move-in or move-out: prorate by days.
- Rounding: round each share to the cent and let the owner absorb the leftover cents.
Example a made-up fourplex counts a vacant unit as one occupant, so the $600 bill is split across 1, 2, 2 and 1 occupants, 6 in all, at $100 per person. The three occupied units pay $100, $200 and $200, and the owner absorbs the vacant unit's $100. A tenant who moves into the $150 unit on day 11 of a 30-day month pays 20 of 30 days, or $100.
Whatever you choose, apply it the same way to every unit. Several statutes read for this series require the lease to describe the method, and Arizona requires a specific description of the method used.
Where DoorKeeping fits
DoorKeeping does not run this calculation or bill tenants for utilities, so keep the worksheet in a spreadsheet and file a copy with the bill. The AI reads the utility bill and codes it to the property's books, tenant reimbursements arrive in your own bank and match through the bank feed, and you can ask Claude or ChatGPT to total a year of bills against a year of reimbursements for one property. Rules differ by state, so confirm yours before you bill.
Sources
Questions
- Which RUBS formula is the fairest?
- None is fair in every case. Square footage is stable but ignores use, and occupants follow use but need a count. Pick one your state allows and describe it in the lease.
- Should a vacant unit pay a share?
- That is a business choice to set in the lease. Many owners absorb it so occupied tenants do not pay for a unit nobody uses.
- How do I prorate a move-in?
- Multiply the unit's share by days occupied divided by days in the billing period, as in the $100 move-in example above.