The Nickel-&-Dime Business For “Other” Utilities

Upside Down Piggy BankWhen I first moved into my apartment almost eight years ago, I didn’t have to pay for the water, sewage and garbage. As the Great Recession lingered on, the new residents had to pay for those services and existing residents were “grandfathered” from paying. That changed last year. I wasn’t happy to pay an extra $60 USD per month, especially with a nickel-and-dime utility billing company (i.e., a $2.50 USD “convenience” fee for paying by credit/debit card).

I mailed a check immediately after receiving the bill in the mail because that was FREE. On the few occasions that my check was “late” (it wasn’t) and my account was hit with a $15 USD late charge, I talked the leasing office into rescinding the late charge. After the paper bill failed to show up in the mail for two months in a row, I sent off letters to start the document chain to file a complaint with the department of consumer affairs. I eventually gave in to paying the damn the convenience fee to avoid the monthly hassles I was going through with the leasing office.

These utility billing companies fall into a legal gray area where they aren’t regulated by the state and local laws, can nickel-and-dime consumers every which way, and use the threat of eviction to encourage prompt payment. The first time I saw the notice that I was behind on the utilities (the paper bill went “missing” in the mail) that threatened eviction taped on the door for everyone to read, I was pissed me off. The leasing manager promised to change the language of the notice since an eviction wouldn’t happen until after the second or third warning for non-payment. The notice was never changed.

I found a new notice on my door that the leasing office was changing utility billing companies. Tenants will no longer have to pay a convenience fee for using their credit/debit card, and can pay the utility bill with their rent at the leasing office. The new billing company wasn’t in the nickel-and-dime business. That was a good change for everyone at the complex. And then I read the next to last paragraph on the notice.

The leasing office reserved the right to apply payment to any unpaid utility bill balance first and the rent balance second. If your check doesn’t cover everything, the utility bill will get paid first, the remainder towards rent and a $150 USD fee for failure to pay the rent in full. This is the same tactic that the banks used to generate overdraft fees by paying the checks first and applying deposits last before Congress put an end to such abusive practices.

Unlike these utility billing companies, the leasing office does fall under state and local laws. I’ll see how this situation plays out before I start writing letters to elected officials and government agencies. This nickel-and-dime business to generate extra income at someone else’s expense has to come to an end.