Managing single-family rental properties in Metro Atlanta comes with its own unique set of hurdles. One of the most frustrating challenges currently facing landlords involves water service—specifically in Fulton County, the City of Atlanta, DeKalb County, and Clayton County.
If you are a property owner in these areas, you may have already run into a situation where a new tenant struggles to get the water turned on. Here is a breakdown of why this is happening and the strategy we use at Excalibur Homes to protect our owners.
The Problem: Massive Deposits and Mismanaged Services
Many local water municipalities are currently struggling with administrative issues. A common byproduct of this is that former tenants often leave behind large, unpaid water bills.
When a new tenant moves in and tries to connect the service in their name, the water department may demand a massive deposit—sometimes between $1,000 and $2,000—to offset the risk. Most tenants simply do not have that kind of cash immediately after paying their first month’s rent and security deposit.
The Trap: The Landlord’s Catch-22
As a landlord, you likely had the water in your name to allow contractors to “turn” the property. Once the tenant moves in, you naturally order a disconnect. However, the county or city may refuse to disconnect the service because the new tenant hasn’t signed up yet.
This puts the owner in a dangerous legal and financial position:
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Lien Risk: If the water bill goes unpaid, the municipality can legally file a lien against your property.
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The Legal Handcuffs: You might be tempted to force the issue by shutting off the water. However, under Georgia Law (O.C.G.A. § 44-7-14.1), it is illegal for a landlord to disconnect utilities until the final outcome of a dispossessory (eviction) hearing—regardless of what the lease says or whose responsibility the bill is.
The Solution: The “Back-Billing” Technique
At Excalibur Homes, we’ve developed a workaround to keep your property protected while ensuring the bills get paid without jumping straight to a costly eviction.
1. The Lease Update We have added language to our leases that addresses what happens if a tenant fails to move the water into their name. If the tenant cannot or will not connect the service, the owner maintains the account.
2. Owner Payment & Reimbursement The water bill is sent to the landlord (or property manager). The landlord pays the bill to ensure no liens are placed on the property and then “back-bills” the tenant. The charge is added to the tenant’s ledger, and they reimburse the landlord with their next rent payment.
3. The Administrative Fee Because this creates significant extra work for the owner and management team, we introduce a fee for this service.
Why this works: When tenants see an extra monthly charge for the “hassle” of us managing their utility bill, it incentivizes them to save up for that deposit and eventually move the utility into their own name.
Summary: A Better Path Forward
While this is a common issue in Metro Atlanta, it is rarely a problem in other parts of the state where deposits are typically $200 or less.
By using this back-billing technique, you avoid the “nuclear option” of evicting a brand-new tenant over a utility deposit, while simultaneously protecting your property from municipal liens. It provides a bridge for the tenant to get on their feet while ensuring the landlord isn’t left holding the bag for the water bill.
If you have questions about managing utilities or navigating Georgia’s landlord-tenant laws, reach out to Excalibur Homes today.