Amended in Senate May 24, 2013

Amended in Senate May 14, 2013

Amended in Senate April 29, 2013

Senate Bill No. 750

Introduced by Senator Wolk

(Coauthor: Assembly Member Fong)

February 22, 2013

An act to add Chapter 2.5 (commencing with Section 1954.201) to Title 5 of Part 4 of Division 3 of the Civil Code, and to add Chapter 8.5 (commencing with Section 537) to Division 1 of the Water Code, relating to water.

LEGISLATIVE COUNSEL’S DIGEST

SB 750, as amended, Wolk. Building standards: water meters: multiunit structures.

(1) The Water Measurement Law requires every water purveyor to require, as a condition of new water service on and after January 1, 1992, the installation of a water meter to measure water service. That law also requires urban water suppliers to install water meters on specified service connections, and to charge water users based on the actual volume of deliveries as measured by those water meters in accordance with a certain timetable.

This bill would require a water purveyor that provides water service to a newly constructed multiunit residential structure or newly constructed mixed-use residential and commercial structure that submits an application for a water connection after January 1, 2014, to require the installation of either a water meter, as defined, or a submeter, as defined, to measure water supplied to each individual dwelling unit. The bill would require the owner of the structure to ensure that a water submeter installed for these purposes complies with laws and regulations governing installation, approval of meter type, maintenance, reading, billing, and testing of water submeters, including, but not limited to, the California Plumbing Code. The bill would exempt certain buildings from these requirements.

(2) Existing law generally regulates the hiring of dwelling units and, among other things, imposes certain requirements on landlords and tenants. Among these requirements, existing law requires landlords to provide tenants with certain notices or disclosures pertaining to, among other things, pest control and gas meters.

This bill would, if a water purveyor requires the installation of a meter or submeter, as specified, or a submeter has been installed, impose further requirements on landlords, relating to submetered water service to individual dwelling units. The bill would prohibit a landlord from charging tenants separately for water service in a property with submeters unless the submetering system is installed, operated, and maintained as specified. The bill would require a landlord to make certain disclosures to the tenant prior to the execution of the rental agreement, including, among other things, that the tenant will be billed for water separately from the rent and that the tenant will also be billed for a portion of any recurring fixed charge billed to the property by the water purveyor, as specified. The bill would specify that a landlord may only bill a tenant for volumetric water usage, as specified, and a portion of any recurring fixed charge billed to the property by the water purveyor, as specified. The bill would specify that the landlord’s billing cycle for water service must match that of the water purveyor and that each bill must include certain information. The bill would prohibit a landlord from charging additional fees related to water service, except as provided. The bill would require a landlord to maintain and make available installation, maintenance, and testing records to a tenant upon request, as specified. The bill would require a landlord to make certain repairs on the water system in a dwelling, as specified. The bill would permit the assessment of begin insert administrative fees and end insert late fees, as specified.

In addition to actual damages, this bill would permit a tenant to recover from the landlord certain damages, costs, and fees for a violation of these provisions. The bill would authorize a city, county, a city and county, or district to enforce these provisions.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Chapter 2.5 (commencing with Section 1954.201)
is added to Title 5 of Part 4 of Division 3 of the Civil Code, to
read:

 

Chapter  2.5. Water Service

 

1954.201.  

It is the intent of the Legislature in enacting this
chapter to do both of the following:

(a) To encourage the conservation of water in multifamily
residential rental buildings through means either within the
landlord’s or the tenant’s control.

(b) To ensure that the practices involving the submetering of
dwelling units for water service are just and reasonable, and include
appropriate safeguards for both tenants and landlords.

1954.202.  

As used in this chapter:

(a) “Billing agent” means a person or entity who contracts to
provide submetering services to a landlord, including billing.

(b) “Landlord” includes all agents of the landlord, billing agents,
and successors in interest to the real property interests of the
landlord. “Landlord” does not include a tenant who rents all or a
portion of a dwelling unit to subtenants. “Landlord” does not
include a common interest development, as defined in Section
4100 of the Civil Code.

(c) “Property” means real property containing two or more
dwelling units that is served by a single meter.

(d) “Rental agreement” includes a fixed-term lease.

(e) “Renting” includes leasing, whether on a periodic or
fixed-term basis.

(f) “Submeter” means a device that measures water consumption
of an individual rental unit within a multiunit residential structure
or mixed-use residential and commercial structure, and which is
owned and operated by the landlord. “Submeter” includes
submeters, if more than one submeter is being used to measure
water usage in a particular dwelling unit.

(g) “Water service” includes any charges for other services,
including sewage or storm water services, that are based in whole
or in part on the volume of water usage recorded by a water meter.

(h) “Water purveyor” means a water purveyor as defined in
Section 512 of the Water Code.

1954.203.  

A landlord shall not charge tenants separately for
water service in a property with submeters unless the submetering
system is installed, operated, and maintained as follows:

(a) The submeter is certified for commercial purposes pursuant
to law, including, but not limited to, Section 12500.5 of the
Business and Professions Code.

(b) The installation conforms to all laws, including, but not
limited to, regulations established pursuant to Section 12107 of
the Business and Professions Code.

(c) The installation was performed by a begin delete licensed service provider end delete
begin insert registered service agency as defined in Section 12531 of the
Business and Professions Code end insert .

(d) The submeter is operated in compliance with regulations
established pursuant to Section 12107 of the Business and
Professions Code.

(e) The submeter for a dwelling unit measures only water that
is supplied for the exclusive use of the particular dwelling unit and
only to an area within the exclusive possession and control of the
tenant of the dwelling unit.

(f) The primary submeter indicator or remote reader may be
easily accessed and read by the tenant of the dwelling unit, and
read by the owner landlord without entering the dwelling unit.

(g) Each submeter is reinspected and recalibrated within the
time limits specified in law or regulation.

(h) All plumbing fixtures and fittings within each dwelling unit
conform to all laws regarding habitability of dwellings and water
conservation.

(i) This section shall not be construed to require a water
purveyor to assume responsibility for ensuring compliance with
any law or regulation governing installation, certification,
maintenance, and testing of water submeters and associated onsite
plumbing.

1954.204.  

Prior to executing a rental agreement, a landlord
that intends to charge a tenant separately for water service shall
clearly disclose the following information to the tenant, in writing,
in at least 10-point type, which may be incorporated into the rental
agreement:

(a) That the tenant will be billed for water service separately
from the rent.

(b) The average bill for water service for units at the property
over the most recent calendar year or, if the building is less than
one year old, a portion of that calendar year.

(c) The frequency of submeter readings.

(d) The due dates and payment procedures for bills for water
service.

(e) If a billing agent is used, the name, address, email address,
normal hours of operation, and toll-free telephone number of the
agent.

(f) The date the submeter was last tested and calibrated, and the
date by which it must be retested and recalibrated under law.

(g) A statement in substantially the following form:

The landlord (or name of landlord) shall charge you (or name
of tenant, or term used in the rental agreement for the tenant) for
water use at the same rate that the (water purveyor) bills its
customers for residential use. To find out what the rate charged
by (water purveyor) is, contact (water purveyor) at (address),
(telephone number).

(h) A statement that the tenant shall be charged for water service
at the exact rate or rates charged by the water purveyor serving
the property.

(i) A statement that the tenant shall also be charged for a portion
of any recurring fixed charge billed to the property by the water
purveyor and that the tenant’s portion of the recurring fixed charge
shall be proportional to the amount of water the tenant uses in
relation to the usage for the entire property.

(j) The current amount of the recurring fixed charge referred to
in subdivision (i).

(k) A statement that no other begin delete administrative, end delete connection,
disconnection, billing, or other periodic fee or charge, except for
begin insert an administrative fee, end insert a late begin delete fee end delete begin insert fee, end insert or begin insert a end insert submeter testing fee, may
be assessed. If the landlord reserves the right to charge begin insert an
administrative fee or end insert a late fee, the amount and terms of the
begin insert administrative fee or the end insert late fee shall also be disclosed.

(l) The location of the submeter, and directions on how to read
the submeter.

1954.205.  

(a) As part of a water service bill, a landlord shall
only bill a tenant for volumetric usage of water service pursuant
to subdivision (b), and a portion of any recurring fixed charge for
water service billed to the property by the water purveyor pursuant
to subdivision (f). The landlord shall not impose any periodic,
connection, termination, or other fee, however denominated, except
for begin insert administrative fees, end insert late begin delete fees end delete begin insert fees, end insert or testing fees as provided
in this chapter.

(b) The amount of the volumetric portion of the bill shall be
calculated by multiplying the volume of water used, as determined
by the submeter for the billing period in question, by the rate or
rates for volumetric usage established by the purveyor of water
service for residential use.

(c) If the rates established by the water purveyor change, the
bill shall be prorated to reflect the time each rate was in effect.
The landlord may assess charges for the entire billing period based
on the lower rate.

(d) If a submeter reading for the beginning or end of a billing
period is, in good faith, not available, the landlord may bill the
tenant 75 percent of the amount originally disclosed to the tenant
pursuant to subdivision (b) of Section 1954.204.

(e) No charges shall be imposed under this chapter if readings
have been unavailable for more than three months.

(f) The amount of the recurring fixed charge for water service
billed to the property by the water purveyor to be charged to the
tenant shall be based on the proportion of the tenant’s volumetric
water use, as shown on the submeter, in relation to the water use
of the entire property, as shown on the property’s water meter.

1954.206.  

(a) The billing cycle for a water service bill pursuant
to this chapter shall match that of the water purveyor.

(b) Submeters shall be read within three days of the same point
in each billing cycle.

(c) Bills shall be due at the same point in each billing cycle.
However, bills shall be due no earlier than 10 days after mailing,
if mailed, or 5 days after personal delivery.

(d) Bills shall include the following information:

(1) The submeter readings for the beginning and end of the
billing cycle, the dates read, and the indicated consumption.

(2) The unit of measure for the readings and usage.

(3) The rate or rates charged per unit of measure.

(4) The amount of the current charges for volumetric use.

(5) The amount of any recurring fixed charge for water service
billed to the property by the water purveyor.

(6) The total water consumption for the property, as indicated
by the property’s water meter.

(7) The percentage of the total water consumption of the
property that was consumed by the tenant.

(8) The amount of current charges assessed to the tenant for the
tenant’s share of any recurring fixed charges for water service
billed to the property by the water purveyor.

(9) A separate entry showing past due amounts, if any.

(10) A separate entry showing any previously imposed late
charges.

(11) The total amount due.

(12) The due date for the bill.

(13) A statement of the amount of any new late charges, if any,
and when the late charges would apply. Late charges shall be
imposed pursuant to Section begin delete 1954.211 end delete begin insert 1954.212 end insert .

(14) The name, mailing address, email address, telephone
number, and the regular business hours of the person or persons
the tenant may call with questions or concerns regarding the bill,
and who is authorized to make any necessary adjustments to the
bill. If a billing agent is used, the name of the entity shall also be
disclosed and the telephone number of the billing agent shall be
toll free.

1954.207.  

A submeter shall be read within three days of the
beginning or end of a tenancy to determine the amount of the first
or last bill for water service. Tenancies that begin or end within
three days of a normal reading may be billed as usual.

1954.208.  

(a) A landlord shall not charge or recover, or allow
to be charged or recovered, any of the following:

(1) Any additional servicing, begin delete administrative, end delete establishment,
maintenance, meter reading, meter testing, billing, or submetering
fees, or any other fee, including those charged by a billing agent,
except as provided in Section 1954.210.

(2) Any fees billed to the landlord by the water purveyor, billing
agent, or any other person for any deposit, disconnection,
reconnection, late payment, or any other water service related
purpose.

(b) This section does not prohibit a landlord from recovering
any costs listed in subdivision (a) that are incorporated into the
rent for a dwelling unit, if the rent is a fixed amount per rental
period, the charges are not listed separately, and the rental charges
are otherwise lawful.

1954.209.  

The landlord shall maintain and make available in
writing, at the tenant’s request, within seven days after the request,
the following:

(a) All installation and maintenance records of the submeter in
the tenant’s dwelling unit, including the name, license number,
and contact information of the begin delete service provider who end delete begin insert registered
service agency that end insert installed or serviced the submeter.

(b) The most recent test results of the submeter in the tenant’s
dwelling unit.

(c) The method and sources used to determine the rate at which
the tenant is charged for water.

1954.210.  

(a) If the water system in a dwelling unit does not
function properly, including leaks, fixtures allowing unnecessary
water consumption, or a malfunctioning submeter, the tenant may
request that the landlord repair the problem. The landlord shall
make the repairs within seven days.

(b) A tenant may request that a landlord have a submeter tested
for accuracy. The landlord shall respond to the request within seven
days, and the test shall be carried out as soon as reasonably
practicable. The test shall be performed by a begin delete service provider end delete
begin insert registered service agency end insert or other person authorized by law to
perform the test. If the test shows that the submeter is inaccurate
beyond the tolerances established by law, the landlord shall repair
or replace the submeter. If the test shows the submeter was
indicating more usage than the actual amount used and beyond
established tolerances, the landlord shall refund the estimated
overcharge to the tenant within 30 days of receipt of the results.

(c) The landlord shall pay for the cost of the test if either:

(1) The tenant requests the test because the submeter has
indicated that water usage has increased more than 25 percent for
two consecutive billing periods over the previous three billing
periods.

(2) The submeter is found to be inaccurate beyond the tolerances
established by law.

(d) The tenant shall pay for the test in all other cases, up to a
maximum of seventy-five dollars ($75).

(e) The landlord is not required to test a submeter under
subdivision (b) if the submeter was tested and found accurate
within two years prior to the tenant’s request and the landlord
provides the written results of that test to the tenant. However, the
landlord shall have the submeter tested if the tenant pays in advance
for the entire cost of the test.

begin insert

begin insert 1954.211. end insert   

(a) A landlord may charge an administrative fee
for the actual costs of reading submeters and providing billing
services, up to a maximum of four dollars ($4) per submetered
tenant per month for water service bills totaling ten dollars ($10)
or more. If a water service bill totals nine dollars and ninety-nine
cents ($9.99) or under, a landlord may charge an administrative
fee for the actual costs of reading submeters and providing billing
services up to 40 percent of the water service bill per submetered
tenant per month.

(b) Beginning January 1, 2017, an administrative fee imposed
pursuant to this section may be adjusted annually by the landlord
commensurate with an increase in the Consumer Price Index.

end insert

begin delete 1954.211. end delete
begin insert 1954.212. end insert   

(a) A landlord may impose a late fee of up to 5
percent for any water service bill not paid within 20 days of its
due date. If the 20th day falls on a Saturday, Sunday, or holiday,
the late fee shall not be imposed until the day after the first business
day following the 20th day.

(b) (1) Notwithstanding Section 1950.5, if a water service bill
remains unpaid after the time described in subdivision (a) expires,
the landlord may, in lieu of a late fee, deduct the amount due from
the tenant’s security deposit. The landlord may require an
additional deposit of security following a deduction, if the deposit
would be otherwise lawful under Sections 827 and 1950.5.

(2) The landlord may also deduct an unpaid water service bill
from the security deposit upon the ending of a tenancy, provided
that the last water service bill showing the amount due is attached
to the documentation required by Section 1950.5, and all the other
requirements of that section are met.

(c) If a water service bill remains unpaid for 30 days after its
due date, the nonpayment shall constitute a curable breach of a
material lease obligation. The landlord may commence an action
to remedy the breach, as provided by law.

(d) Water service charges under this chapter shall not constitute
rent.

(e) A landlord shall not shut off the water or otherwise interfere
with the provision of water service to a dwelling unit for any
reason, including nonpayment of a bill assessed pursuant to this
chapter.

begin delete 1954.212. end delete
begin insert 1954.213. end insert   

In addition to actual damages sustained by a tenant
for a violation of this chapter, the tenant may recover from the
landlord three times the amount of actual damages, a civil penalty
equal to one month’s rent, reasonable attorney’s fees, and court
costs. A landlord shall not be liable for a civil penalty if the
landlord proves that the violation was a good faith, unintentional
mistake.

begin delete 1954.213. end delete
begin insert 1954.214. end insert   

A city, county, city and county, or district may
enforce this chapter.

begin delete 1954.214. end delete
begin insert 1954.215. end insert   

The rights or obligations established under this
chapter shall not be waived. Any purported waiver is void.

begin delete 1954.215. end delete
begin insert 1954.216. end insert   

This chapter applies only to property where
submeters have been installed or where a meter and submeters are
installed pursuant to Chapter 8.5 (commencing with Section 537)
of Division 1 of the Water Code.

SEC. 2.  

Chapter 8.5 (commencing with Section 537) is added
to Division 1 of the Water Code, to read:

 

Chapter  8.5. Multiunit Structures

 

537.  

(a) The following definitions govern the construction of
this chapter:

(1) “Meter” has the same meaning as “water meter” in Section
516.

(2) “Submeter” means a device that measures water consumption
of an individual unit within a multiunit residential structure or
mixed-use residential and commercial structure, and is read by the
owner of the structure or the owner’s agent.

(b) Structures in all of the following categories shall be exempt
from this chapter:

(1) Low-income housing. For purposes of this paragraph,
“low-income housing” means a residential building financed with
low-income housing tax credits, tax-exempt mortgage revenue
bonds, general obligation bonds, or local, state, or federal loans
or grants, for which the rents of the occupants in lower income
households, as defined in Section 50079.5 of the Health and Safety
Code, do not exceed rents prescribed by deed restrictions or
regulatory agreements pursuant to the terms of the financing or
financial assistance, and for which not less than 25 percent of the
dwelling units within the building are designated for occupancy
by lower income households, as defined in Section 50079.5 of the
Health and Safety Code.

(2) Student dormitories.

(3) Long-term health care facilities, as defined in Section 1418
of the Health and Safety Code.

(4) Time-share property, as defined in subdivision (aa) of
Section 11212 of the Business and Professions Code.

(5) Residential care facilities, as defined in subdivision (k) of
Section 1569.2 of the Health and Safety Code.

(c) This chapter does not apply to a structure that is greater than
four stories in height above grade if the owner, or his or her agent,
demonstrates to the satisfaction of the water purveyor that the
structure’s plumbing configuration incorporates multiple points
of entry in each dwelling unit and renders the installation of
submeters infeasible.

(d) A submeter used to measure water supplied to an individual
residential unit that is required to be installed by a water purveyor
pursuant to this chapter, shall be of a type approved pursuant to
Section 12500.5 of the Business and Professions Code, and shall
be installed and operated in compliance with regulations established
pursuant to Section 12107 of the Business and Professions Code.

538.  

(a) Each water purveyor that sells, leases, rents, furnishes,
or delivers water service to a newly constructed multiunit
residential structure or newly constructed mixed-use residential
and commercial structure for which an application for a water
connection, or more than one connection, is submitted after January
1, 2014, shall require the installation of a water meter or submeter
to measure the water supplied to each individual dwelling unit as
a condition of new water service.

(b) (1) If the water purveyor requires installation of submeters
pursuant to subdivision (a), the owner of the structure shall ensure
that each submeter installed complies with all laws and regulations
governing installation, approval of meter type, maintenance,
reading, billing, and testing of water submeters, including, but not
limited to, the California Plumbing Code.

(2) This subdivision does not require a water purveyor to fund
or assume responsibility for ensuring compliance with any law or
regulation governing installation, approval of submeter type,
maintenance, reading, billing, and testing of water submeters and
associated onsite plumbing.

539.  

It is the intent of the Legislature that this chapter should
not be construed to impose costs on any local government agency,
except to the extent that the local government agency is a water
purveyor.