A Howard County government advisory board recommended yesterday that the County Council outlaw the practice of billing apartment dwellers for water based on estimated use within 10 years, sharply limit the size of service fees charged by billing companies and require metered billing on all new apartments.

If the recommendations are adopted, Howard County would be the first Maryland municipality to regulate estimated water billing.

Apartment tenants in Howard and elsewhere across the nation have complained that estimated bills are unfair because they do not reflect a tenant's actual water use.

"The Board believes the current unrestricted practice of [estimated billing] by some landlords within Howard County results in unacceptably high water bills for some tenants," the six-member board concluded in an almost-400-page study.

Water billing company officials and landlords said yesterday that the board's recommendations could lead to rent increases and would hurt Howard's apartment market in general. But state officials and tenant advocates say they hope other state municipalities study Howard's recommendations and work to ban estimated water bills across Maryland.

"I'm encouraged. ... This will help people who have very little representation and correct a system which just doesn't seem fair," said Donald F. Rogers, an attorney with the Maryland Office of the People's Council, a state office that protects the interests of residential utility customers.

County Council members said yesterday that they might alter the Consumer Affairs Advisory Board's recommendations after further study but added that they are committed to regulating the water billing industry.

"We need to make sure that higher costs are not passed on to the tenants," said Councilman Ken Ulman, a West Columbia Democrat.

Councilman Guy Guzzone, a North Laurel-Savage Democrat, also said he will push for explicit legislation that would outlaw any companies making a profit from the reselling of water. Reselling water for a profit is illegal in many states but county employees said yesterday that it is unclear whether it is illegal in Howard County.

The growing practice of estimated water billing has been outlawed or regulated by governments in Texas, Florida, Oregon and elsewhere.

Rising costs to blame

Traditionally, water and sewer costs have been included in the rent of apartment dwellers. But as water costs have climbed since the 1990s, more landlords have begun charging tenants for water separately.

Some apartments, especially newer ones, install a meter for each apartment so each tenant is billed for their exact usage, a practice known as submetering.

The owners of many complexes in Howard and elsewhere use estimated bills prepared by billing companies that charge tenants a fee for their services.

The billing companies take the total water and sewer cost for a complex and subtract a percentage for common area water costs like sprinklers and pools.

The company will then divide the remainder of the bill among the residents based on a formula that depends on variables such as the number of people in the apartment, square feet or rooms.

The billing company's monthly service fee is generally about $3. Billing companies say the tenant fees are their only source of income because they do not profit from the water sales.

The companies also predict that tenants will start using less water once they are responsible for paying for it.

At least 20 Howard apartment complexes, with thousands of residents, use estimated billing.

The advisory board began reviewing estimated billing practices in Howard after an article that appeared in The Sun in March showed that some families living in apartments with estimated billing were paying more than $40 a month for their water and sewer - an amount significantly higher than the county average and as high as bills paid by families living in large suburban homes with lawns and multiple bathrooms.

The board held four public hearings, listening to testimony from residents, landlords and billing companies. They proposed to the County Council that:

All apartments under construction should be submetered.

All existing apartments should be submetered by Jan. 1, 2013.

Tenants living in an apartment complex that uses estimated billing should be charged on a per-person basis.

Landlords who install individual apartment meters before 2013 should receive an economic benefit, like a tax break.

Monthly water billing fees should be capped at $1 per unit

Landlords should be required to explain estimated billing practices to their tenants.

The County Council has not decided when it will consider the board's recommendations.

State elected officials and tenants rights groups applauded the proposals and said that they would try to persuade other municipalities to follow Howard's lead.

"It sounds like Howard took some very rational steps, so I think others will try and follow," said Bill Temmink, a program manager with Baltimore Neighborhoods Inc., a nonprofit tenants rights group.

The group, which works in the Baltimore area, gets about 200 complaints related to estimated billing each year, Temmink said.

Del. Elizabeth Bobo, a Howard County Democrat, said she would talk to other delegates to see whether there is enough interest to "take a statewide approach."

"I'm very pleased. It looks like [Howard County] made some good recommendations," said Bobo, who noted that many of the county's poorer residents live in the apartment complexes.

"When you're on the lower end of the income scale, every dollar makes a difference," she said. "[These recommendations] could make a difference in whether a lower-income kid gets to play soccer or not."

But estimated-billing advocates said the recommendations could harm Howard's rental market by forcing apartment owners to make large investments, which they would then pass on to their residents in the forms of higher rent.

They say it is difficult and expensive to meter each apartment in older buildings because they have antiquated piping systems.

Sites' age discussed

Representatives from Wellspring International, a San Diego-based company, said that they have small-meter technology that will allow older apartment complexes to be submetered for less than $500. Estimated-billing advocates are doubtful the technology can be widely applied.

"[Submetering] is not financially viable," said Jim Caffey, executive vice president the Maryland Multi-Housing Association, Inc, a group which represents 65 properties in the state. "[Submetering] puts older buildings at a competitive disadvantage. ... It will turn them into a greater [economic] liability."

Caffey also worried that the per-person formula would be difficult to enforce.

"Is the property manager going to have to police the complex? Will neighbors report people who let their friends crash at their place for three months?" he asked.

Builders at issue

The added cost could persuade landlords to invest in areas where they are not required to meter individual units, others said.

"Builders will say: 'Gee, I could build in Howard County or I could build over here, where costs would be lower,'" said Bill Griffin, co-chair of the National Submetering & Utility Allocation Association, a national group.

"I think they builders would go where the costs would be lower," said Griffin, who is also vice president and general counsel for National Water and Power Inc., a company which administers estimated billing programs for some Howard County landlords.

While tenants in Howard apartments with estimated billing know that the recommendations will probably not affect them any time soon, they still celebrated yesterday's news.

"I know that some of the things cannot happen in a couple of days or years and I will still have to pay. ... But it's good news that something could be changed," said Roberto Reyes, who lives with his wife and two children in the Dorsey's Forge apartment complex and pays nearly $38 a month for his water and sewer.