RUBS stands for Ratio Utility Billing System. It's a way of dividing a building's water and sewer bill among residents using a formula — occupants, square footage, bedrooms — rather than how much water each unit actually used.

RUBS gets criticized a lot. But it exists for a good reason, and it's worth understanding why before deciding whether it still fits your buildings.

RUBS was an answer to a plumbing problem

Most older apartment buildings have one city water meter and no separate pipe to each unit. Water runs up shared risers that feed several apartments at once. If you can't meter a unit, you can't bill it for what it used.

So owners were left with two choices: absorb the entire water bill, or divide it fairly by some other measure. RUBS is the second choice. No hardware, no construction, and a billing company can set it up in weeks. For many owners, it was the only practical option on the table.

How RUBS is calculated

Most programs work the same way. Start with the city bill. Take out common-area use — landscaping, pools, laundry rooms — which usually stays with the owner. Then divide what's left by formula.

A simple example, with illustrative numbers:

• Monthly water and sewer bill: $6,000
• Common-area share kept by the owner (10%): −$600
• Amount to divide: $5,400
• Residents in the building: 120
• Charge per resident: $45 — so a two-person apartment pays $90

Occupant count is the most common basis for water. Others use square footage, bedroom or bathroom count, or a blend — for example, half by occupants and half by square footage. On the owner's books, what's collected is often called RUBS income.

What RUBS can't do

It can't reflect use. A resident away for a month pays about the same as one who was home every day. That's the source of most resident complaints about RUBS.

It can't see waste. This is the bigger issue for owners. When a toilet runs for three months, the building bill goes up and RUBS spreads the extra cost across everyone. Nobody knows which fixture caused it, so nobody fixes it.

And someone is always paying for that waste. Where RUBS is capped, the overage lands on the owner. Where it's passed through, it's money residents could have spent on rent and building services.

Where RUBS is restricted

RUBS is banned in New York City, Delaware and North Carolina, and Los Angeles and Colorado are moving in the same direction. Where it's still allowed, rules often set the formula and cap how much of the bill can be passed to residents.

California took a different route. Under SB 7, new multifamily buildings permitted after January 1, 2018 must install water submeters, so residents are billed on measured use.

RUBS also doesn't apply where residents aren't billed for utilities at all — most student housing, senior living and hotels. There, every gallon of waste is the owner's.

If your buildings are in a restricted market, or one heading that way, the recovery you count on today may not be there tomorrow — and water becomes the owner's expense again.

Keeping RUBS, or moving on

DrizzleX works with or without RUBS.

If you're keeping RUBS, fixture-level water intelligence finds the waste RUBS was never built to see. The bill you're dividing gets smaller, and residents stop paying for a neighbor's running toilet.

If you're moving off RUBS, fixture-level metering gives you what the plumbing never could: a measured total for every unit, without a separate pipe to each one. From there you can bill on actual gallons instead of a formula. See RUBS vs. submetering: how to decide and switch.

Quick answers

What does RUBS stand for?

Ratio Utility Billing System — a way to divide a building's utility bill among units by formula rather than metered use.

What is RUBS in real estate?

A method multifamily owners use to recover water, sewer and other utility costs in buildings without individual meters. Charges usually appear as a separate line on the rent statement.

What is RUBS income?

The utility cost recovered from residents through RUBS charges, usually tracked as other income because it offsets the utility expense.

Is RUBS legal?

It depends on location. It's banned in New York City, Delaware and North Carolina, and restricted or capped in many other places. Check local rules before starting or changing a program.

What's the alternative to RUBS?

Submetering — billing each unit for the water it actually used. Read what water submetering is.

Planning your next step on RUBS?

Whether you're keeping it or moving to actual-use billing, we'll walk you through the options for your buildings. Talk to Sales