President's Message

August 2008

Warning: City governments may have already put a lien on your property.

Terry Flora-Turner of High Desert Property Management recently received a letter from the City of Bend threatening to put a lien on one of her client’s houses for an unpaid sewer bill left by a tenant. The owner of the property had received the letter and was very upset that the bill was unpaid by the “long gone tenant” and now his responsibility to pay. The client called Terry to see if she knew anything about the billing. Terry did not, so she did some research. Turns out the City of Bend was owed some money on a delinquent sewer bill from this tenant more a year ago. Since they had no response from the tenant, they were now going after the owner.

Terry called the City of Bend and explained that they could not place a lien on the property or even hold the owner of the property responsible for tenants’ delinquent bills. ORS 91.255 (page 147 of the Oregon Rental Housing Association Law Book) specifically details how any Oregon utility company must deal with tenants’ bills in order to hold the owner responsible. This statute includes water and sewer companies. The law states that the utility company must first get the written consent of the owner, and second notify the owner in writing within 30 days of the unpaid bill. The Cities of Redmond and Prineville address this issue by requiring owners and tenants to sign a “Consent to Bill Tenant Form” before they allow a tenant to sign up for sewer or water. This form provides the utility with all the information regarding both the owner and tenant including addresses and phone numbers, and includes a statement that the owner will be responsible for the bill if the tenant doesn’t pay it. In both cities they contact the owner by mail whenever there is an outstanding tenant bill.

Jim Forbes, the attorney for the City of Bend, responded to Terry by email that the City of Bend doesn’t have to notify the owner of unpaid tenant bills and that owners do not have to give consent to become responsible. His opinion is that the City of Bend is exempt from ORS 91.255. He says that owner approval is implied in the law!

The owners of the property involved went ahead and paid the bill because it was under $100 and they wanted to avoid a lien. A word to all our members out there: if you have a rental property anywhere in Oregon where your tenant pays water or sewer, you should call the city involved and make sure that the same “strong arm” tactics will not be used on you. The City of Bend, like all Oregon cities, should have to follow Oregon law. A small $50 lien placed on your property could with interest and penalties be a sizable amount of money in a short period of time. The tenant who actually owes the bill could be long gone with a check that you wrote for their deposit refund. A lien against your property could affect your credit or the sale of your property.

In our busy lives of managing property, keeping up on all the laws, keeping tenants happy and maybe also having a career separate from our rental properties, this is one more thing we should not have to worry about. Your voice will make a difference! If you think the City of Bend needs to change their policy, give them a call at 541-388-5515.

See you next month!
Terry Luelling