Guide

Texas Water Submetering Rules for Landlords and Park Owners

Last reviewed October 3, 2026

Texas lets owners of apartments, condominiums and manufactured home communities bill residents for the water they use, as long as they follow the Public Utility Commission of Texas (PUC) submetering rules. Here is what those rules ask of you, in plain English.

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.

Who the rules cover

The rules apply to apartment houses, condominiums, manufactured home rental communities and multiple use facilities that buy water through a master meter and bill residents for it (§24.275). They cover two ways of billing:

Submetered billing: each home or unit has its own meter, and residents pay for what their meter measured.
Allocated billing: there are no unit meters, and the master bill is split by a formula such as occupants or square footage. This guide focuses on submetered billing. See submetering vs. allocation in Texas for how the two compare.

RV parks are not named in these rules or in the Texas Water Code submetering section (§13.503). If you run an RV park, check with the PUC before billing guests for water.

1. Register with the PUC

Before you bill residents for submetered water, or when you change how you bill, you must register with the PUC on its prescribed form (§24.277(a)).

2. Put the terms in the lease

The rental agreement must clearly state (§24.279):

That the resident will be billed by the owner for submetered water
Which utility services are included in that bill
That billing disputes are between the resident and the owner
The average monthly bill for all units in the previous calendar year
The meter reading, billing and due dates
How quickly you will repair leaks
The resident's right to see the information you used to calculate their bill
The service charge percentage, if you charge one

You must also give each resident a copy of the rules.

3. Read meters on the utility's schedule

Read each submeter within three days of the date your water utility reads the master meter (§24.283(c)). Bill for the same period the utility bills you, which is usually monthly (§24.283(d)).

If a meter can't be read or is broken, you may send an estimated bill. It must be clearly marked as an estimate, and the next bill must correct it to the actual charges (§24.283(i)).

4. Calculate each resident's charge

You pass through what the utility charges you. You can't add deposits, disconnect fees or late fees the utility charged you (§24.281(a)). Each month (§24.281(d)):

Take the utility's total water charges, minus any base or customer service charges.
Divide by the total gallons the master meter recorded. That is your average cost per gallon. You may instead use the utility's own volumetric rate.
Multiply by the gallons the resident's meter recorded that month.
Do the same for wastewater, using the same water usage.
Optionally add a service charge of up to 9% of the resident's water and wastewater charge. It isn't allowed for residents in tax-credit apartment units or residents with Section 8 vouchers.

A customer service charge from the utility is split evenly across every unit the master meter serves, including vacant ones. You can't bill residents for base charges on empty units (§24.281(b) and (c)).

Example

Your utility bill shows $1,240 in water usage charges and $930 in wastewater charges, for 310,000 gallons. That works out to $0.004 a gallon for water and $0.003 for wastewater. A resident who used 3,240 gallons owes $12.96 for water and $9.72 for wastewater, or $22.68. With a 9% service charge of $2.04, their bill is $24.72.

Try our free water bill calculator to run your own numbers.

When a resident moves out mid-month, you can send a final bill before the utility bill arrives. Use the resident's average rate for the last three months times their usage (§24.281(d)(4)).

5. Put the required items on every bill

Each bill must include (§24.283(f)):

A clear statement that the service is submetered
Total due for water
Total due for wastewater, if you bill it
Total due for any base or customer service charges
Total due for water or wastewater usage
The name of your water utility, and a statement that the bill is not from that utility
The resident's name and address
Who prepared the bill, and the name, address and phone number to contact about a billing dispute
The name, address and phone number of who to pay

6. Due dates and late fees

The due date must be at least 16 days after you mail or hand-deliver the bill. If it falls on a weekend or federal holiday, it moves to the next working day (§24.283(h)).

You may charge a one-time late penalty of up to 5%, but only if the written lease states the percentage (§24.283(m)).

7. Keep your meters accurate

Submeters must meet American Water Works Association accuracy standards. If a resident asks, you must show that their meter was tested within the last 24 months and passed. If you can't, or the meter fails, you can't charge for the test. If it passes, you may charge up to $25 (§24.287(a)).

8. Keep records

Keep records for the current and previous calendar year, and keep meter test results until the meter is taken out of service (§24.277(e) and (f)). That includes:

The utility's current rates and its bills to you
Every submeter reading and test result
How you calculated the cost per gallon
The total you billed residents and the total you collected each month

9. Handle disputes and billing mistakes

When a resident disputes a bill in writing, investigate and give them your findings in writing within 30 days (§24.283(l)).

If you overcharged a resident, refund every bill that included the overcharge. If you undercharged for a reason other than meter error, you can only go back six months, and you must offer a payment plan if the amount is over $25 (§24.283(k)).