South Shore tenants say rent fluctuates by hundreds each month thanks to Ratio Utility Billing System
Tenants at a South Shore apartment building said they've noticed their rent fluctuating by hundreds of dollars a month due to a change in how their utility billing system is set up.
While the practice has raised concerns among tenants, it turns out it's completely legal. Fifth Ward Ald. Desmon Yancy said the system "doesn't sound like it's equitable, fair or even reasonable" for the tenants in his ward. Other cities and states have started to fight back against it.
Diane Meade has lived in Oglesby Towers in South Shore on and off for the past 35 years. She loves her community, and her unit, and loves her location. But she's also a widow on a fixed income, and she isn't sure if she'll be able to stay under this new system.
"I never thought at this age that I would become an activist, but I got angry," she said.
The new billing system is called a Ratio Utility Billing System, or RUBS. In it, landlords create a formula to split a building's master utility bills across each unit. It's not based on the tenant's actual usage, so the water, trash and electrical bills can fluctuate widely from month to month, as much as $300 to $400 according to some tenants at Oglesby Towers.
"You could budget for a flat fee. Now with RUBS, we don't know from month to month what our rent is going to be," Meade said.
Not only is trash more expensive, but now Meades can't even use her trash chute. The management company locked the door and now she has to drag her trash downstairs to throw it out.
"We are hearing reports from around the country of buildings that have transitioned to RUBS and really similar complaints," said April Kuehnhoff from the National Consumer Law Center.
Kuehnhoff explained that RUBS can hide overcharges, let landlords pass on costs and make it very hard for tenants to tell if their bills are correct. A growing number of cities and even states have taken action to limit or even ban the use of RUBS. For example, Minnesota's RUBS law prohibits landlords from making a profit on the system. There's currently an effort to ban RUBS altogether in Seattle.
"Frankly, prohibiting RUBS would be our strongest recommendation here, because of all of the consumer protection harms," Kuehnhoff said.
CBS News Chicago Investigators reached out to the management company and the property manager at Oglesby Towers but have not yet heard back.
Ald. Yancy said they're still in the early stages of trying to understand how widespread the use of RUBS is, but he agrees that it's problematic and is investigating restrictions at the city level are possible.
"It's time for our elected officials to say, hey, management, there's there needs to be a limit as to how much you can go up on someone's rent," he said.
