Ariz. Rev. Stat. § 33-1314.01
Utility charges; submetering; ratio utility billing; allocation; water system exemption
Operative Text
A. A landlord may charge separately for gas, water, wastewater, solid waste removal or electricity by installing a submetering system or by allocating the charges separately through a ratio utility billing system. B. If a landlord charges separately for a utility pursuant to subsection A, the landlord may recover the charges imposed on the landlord by the utility provider plus an administrative fee for the landlord for actual administrative costs only. The landlord shall not impose any additional charges. The rental agreement shall contain a disclosure that lists the utility services that are charged separately and shall specify the amount of any administrative fee that is associated with submetering or the use of a ratio utility billing system. C. If provided in the rental agreement, the landlord may impose a submetering system or ratio utility billing system during the term of a rental agreement if the landlord provides notice as prescribed by subsection G. D. If a landlord is not in compliance with subsection B, the tenant shall first object in writing to the landlord regarding the utility billing. If the dispute is not resolved, the tenant may file a civil complaint in justice court to enforce this section. E. If a landlord uses an allocation or submetering system, the bill format for each billing period shall: 1. Separately state the cost of the charges for the period together with the opening and the closing meter readings and the dates of the meter readings. 2. Show the amount of any administrative fee charged. F. If a landlord does not use a submetering system and allocates charges separately for gas, water, wastewater, solid waste removal or electricity, the landlord may allocate the costs to each tenant by using one or more of the following ratio utility billing system methods: 1. Per tenant. 2. Proportionately by livable square footage. 3. Per type of unit. 4. Per number of water fixtures. 5. For water and wastewater, by use of an individually submetered hot water usage measure for the tenant's dwelling unit. 6. Any other method that fairly allocates the charges and that is described in the tenant's rental agreement. G. If a landlord uses a ratio utility billing system method pursuant to subsection F, the rental agreement shall contain a specific description of the ratio utility billing method used to allocate utility costs. For any existing tenancies, the landlord shall provide at least ninety days' notice to the tenant before the landlord begins using a submetering system or allocating costs through a ratio utility billing system. H. For purposes of regulating apartment communities as public or consecutive water systems, the department of environmental quality shall not adopt rules pursuant to title 49, chapter 2, article 9 that are more stringent than those authorized by federal law. Without other evidence of activities that are subject to regulation under title 49, chapter 2, article 9, the department of environmental quality shall not use an apartment community's use of a submetering system or a ratio utility billing system as the sole basis for regulating an apartment community as a public or consecutive water system.
Arizona Revised Statutes § 33-1314.01 permits landlords to bill tenants separately for utilities such as gas, water, wastewater, solid waste removal, or electricity using either a submetering system or a ratio utility billing system. When separate billing is used, the landlord may only pass through the actual charges from the utility provider plus a documented administrative fee—no additional markups are allowed. The rental agreement must disclose which utilities are billed separately, the administrative fee amount, and the specific allocation method used, and existing tenants must receive at least 90 days' notice before a new billing system takes effect.
Plain English — not legal advice.
Under A.R.S. § 33-1314.01, compliant operators ensure that any separate utility billing arrangement is fully described in the rental agreement, including the specific ratio utility billing method or submetering approach, the utilities covered, and the exact administrative fee charged. Bills issued each period itemize opening and closing meter readings, dates, and the administrative fee as separate line items. When transitioning existing tenants to a submetering or ratio utility billing system mid-tenancy, operators provide written notice at least 90 days in advance and limit cost recovery strictly to the utility provider's charges plus actual administrative costs.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
A.R.S. § 33-1314.01 gives tenants the right to receive clear, itemized utility bills and to have the billing method and any administrative fee disclosed in their rental agreement before separate utility charges apply. If a tenant believes a landlord is charging more than the utility provider's actual costs plus a legitimate administrative fee—or is otherwise not complying with this section—the tenant's first step under the statute is to raise the concern in writing directly with the landlord. If the written objection does not resolve the dispute, the statute allows the tenant to file a civil complaint in justice court; tenant-rights organizations can provide general information about how that process works.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 14, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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