Water Submetering vs. Allocation (RUBS) in Texas

If your property buys water through one master meter, Texas gives you two ways to pass the cost on to residents. You can submeter each unit and bill for actual use, or you can allocate the master bill by a formula, which many owners call RUBS (ratio utility billing). The Public Utility Commission of Texas (PUC) rules treat them differently. Here is how they compare.

This guide is not legal advice. It summarizes 16 Texas Administrative Code Chapter 24, Subchapter I. Rules change, so read the current version and confirm your obligations with the PUC or a lawyer.

The short version

What each method means

Submetered billing means each unit has its own meter that you own and read. Residents pay the utility's rate for the gallons their meter recorded. Our Texas water submetering guide walks through those rules step by step.

Allocated billing means there are no unit meters. The rules define it as service that is master metered to the owner and allocated to residents by the owner (§24.275). Each resident pays a share of the master bill based on a formula, not on what they used.

Both methods are covered by the same rules, which apply to apartment houses, condominiums, manufactured home rental communities and multiple use facilities. RV parks are not named in these rules or in the Texas Water Code submetering section (§13.503), so RV park owners should check with the PUC before billing guests for water either way.

How allocation works under the Texas rules

Step 1: Take out base charges and common areas

Before you split the master bill, you must first deduct the utility's dwelling unit base or customer service charges, and the water used by common areas such as landscape irrigation, pools and laundry rooms (§24.281(e)(1)). How much you deduct for common areas depends on what is metered:

• All common areas separately metered or submetered: deduct the actual common area usage.
• Common areas on the master meter, with an installed landscape irrigation system: deduct at least 25%.
• Irrigation metered separately, but other common areas like a pool or laundry room are not: deduct at least 5%.
• Common areas on the master meter, with no installed irrigation system: deduct at least 5%.

The deducted share is yours to pay. On a property with unmetered irrigation, that is at least a quarter of the bill.

Step 2: Split the rest with an approved formula

For apartment houses, the rule lists the formulas you may use to set each unit's share (§24.281(e)(2)(A)):

• Actual occupants: the unit's occupants divided by the total occupants in all units.
• Ratio occupancy: one occupant counts as 1, two as 1.6, three as 2.2, and each additional occupant adds 0.4.
• Bedrooms: an efficiency counts as 1, one bedroom as 1.6, two bedrooms as 2.8, three bedrooms as 4, and each additional bedroom adds 1.2.
• Square footage and occupancy: a combination in which no more than 50% is based on square footage.
• Submetered hot or cold water: a unit's submetered hot or cold water use as a share of the total.

Condominium managers may use the same formulas or follow the method in the condominium contract (§24.281(e)(2)(B)). Owners of other property types should check the rule for the formulas that apply to them.

Example

A 24-unit complex gets a master bill with $3,200 in water and wastewater usage charges, after base charges. The landscape irrigation runs through the master meter, so the owner deducts 25%, or $800, and allocates the remaining $2,400.

Using the bedroom formula, the complex has eight one-bedroom units (1.6 each), twelve two-bedroom units (2.8 each) and four three-bedroom units (4 each), for a total of 62.4. A two-bedroom unit's share is 2.8 ÷ 62.4 × $2,400, or $107.69. Every two-bedroom unit pays that amount, whether its residents took short showers or ran a leaking toilet all month.

Where the two methods differ

Fairness to residents

A submetered bill reflects what the resident used, so careful residents pay less and a leak shows up on that unit's bill. An allocated bill depends on the formula, so a single resident in a large unit can subsidize a big household next door, and no one sees the effect of their own habits.

What you recover

With allocation, you absorb the common area deduction every month. With submetering, residents pay for exactly what their meters recorded at the utility's rate, and the rules allow a service charge of up to 9% of the resident's water and wastewater charge (§24.281(d)). That service charge isn't allowed for residents in tax-credit units or with Section 8 vouchers, and the rule provides it for submetered service, not allocated service.

New construction

Properties where construction began after January 1, 2003 must measure each unit's water with submeters owned by the owner or individual meters owned by the utility (§24.277(b)). For those properties, allocation is not an option.

Switching methods

Moving from allocation to submetering is a common upgrade. You must register with the PUC when you change how you bill (§24.277(a)), and your leases need the submetering terms from §24.279. Going the other way is restricted: you can't change from submetered to allocated billing without written approval from the PUC after showing good cause (§24.279(d)).

Monthly work

Allocation needs no meter reading, which is its main appeal. You do need accurate occupant or unit data, and the lease must clearly describe the formula you use (§24.279(a)(5)). Submetering adds a reading for every unit within three days of the utility's read date (§24.283(c)), plus the records the rules require.

That reading is the part MeterPic is built for: you photograph each meter with your phone, MeterPic reads the number, and you confirm it. To see what a submetered bill would look like for your property, run your numbers through our water bill calculator.

Sources

• PUC Texas, 16 TAC Chapter 24, Subchapter I: Submetering and Allocation
• Texas Water Code §13.503: Submetering