Can landlords make a profit from utilities payments?

May 12, 2009 8:50 AM

In Washington State, can a landlord legally make a profit off of a business tenant's utility payments?

I own a business in Washington State. We've been in one space for several years and are currently negotiating our lease option.

The landlords had not previously mentioned any increase in our utilities bill until after they agreed (at our request, due to the economy) to not raise our rent for the next year.

When they sent us the new agreement, however, they now claimed that our utilities payments (water and electricity only) were going up 25%.

We suspect that this increase may be retalitory in nature, which leads me to wonder: can they charge us more for utilities than those utilities actually cost them, and then pocket the rest? Or, legally, should our cost be the actual cost?

posted by anonymous to work & money (2 comments total)

"can they charge us more for utilities than those utilities actually cost them"

Odds are they can charge you whatever they want.

If they weren't permitted to do that, I'm not sure why they'd be putting themselves between you and the utility companies. They're probably already making a profit on your utilities.
posted by toomuchpete at 10:50 AM on May 12

Depending on how the building is set up, they may not have a way to determine the actual utility payment for your leased portion. I know in my apartment, we pay a flat rate for "rent and utilities" simply because each unit is not wired with its own electric meter and there is a shared hot water system (boiler in the basement). I'm sure our landlord is making a "profit" from the utility portion of our rent payment since we never run the HVAC unit and are out of town a lot. Do I care? No.
posted by bengarland at 10:51 AM on May 12