A submetering arrangement counts as tenant-paid only if the bill reflects the unit's ACTUAL consumption

lihtc.ua.actual_consumption_submetering_definition · v1.0.0

An arrangement under which the owner buys a utility and rebills it to tenants is an actual-consumption submetering arrangement -- and so is treated as the tenant paying directly, requiring a utility allowance -- only if it has ALL of the attributes in 1.42-10(e)(1): the utility is purchased from or through a local utility company by the owner or is produced from a renewable source; the tenants are billed for and pay the owner for the unit's consumption; the billed amount reflects the unit's actual consumption; and the rate charged satisfies 1.42-10(e)(1)(iv). Sewerage combined on one bill with water and determined from the unit's actual water consumption is treated as reflecting actual sewerage consumption. Where the billed amount does NOT reflect the unit's actual consumption -- an allocation by square footage, occupancy or any other ratio -- the arrangement fails 1.42-10(e)(1)(iii) and is not an actual-consumption submetering arrangement, so the utility is not treated as paid directly by the tenant under 1.42-10(a).

Confidence

high

Effective from

2016-03-03

Last reviewed

2026-08-31