Advancing Water & Sewer Rate Equity for Multifamily Housing

How we reduced utility overbilling for a multifamily community in the Gulf Coast to align with industry standards.

Client

A major multifamily housing owner in Louisiana, operating a large portfolio of apartment communities across several parishes, sought to understand why their utility costs were significantly higher than comparable residential users. Despite consistent consumption patterns, their communities were experiencing overbilling both of water and sewer services.

Challenge

Under the existing master-meter billing approach, each multifamily property was billed through a singular 3,000-gallon minimum water and sewer allocation—regardless of how many residential units were on-site. This approach led to properties with hundreds of units being billed as if they were a single household, instead of individuals.

The structure created multiple problems that were identified:

Apartment residents were paying more than 50% above what single-family households paid for water.
Sewer charges were more than double, disproportionately burdening lower-usage tenants.
The rate design was regressive and consumption-blind, with no consideration for unit count or use patterns.
Cost inequity distorted budgeting for the complex owner and created long-standing affordability challenges for residents.

The property owner engaged EisnerAmper to evaluate the billing methodology, quantify inequities, and determine whether a more equitable and practical rate structure could be implemented.

Approach

EisnerAmper conducted a Water and Sewer Rate Equity Analysis grounded in the American Water Works Association (AWWA) rate design principles. The team used a combination of invoice data, consumption records, and local rate schedules to model a per-unit billing structure that preserved the utility’s revenue requirements while fairly distributing the minimum allocations across each residential unit.

Key elements of the analysis included:

Developed a usage-based per-unit model applying a 3,000-gallon minimum for each dwelling.
Calculated comparative water and sewer costs under current and proposed structures.
Benchmarked the results against AWWA’s guidance on fairness, transparency, and revenue sufficiency.
Demonstrated how the revised structure could be implemented without negatively affecting total system revenue or financial stability.

Key Findings

The team’s analysis revealed clear, measurable inequities under the current structure:

Water charges were 55% higher for multifamily customers under the prior meter model

Sewer charges were 115% higher, representing the largest imbalance

Average tenant costs were $56.86 per unit per month under the existing approach

Under the modeled per-unit method, this dropped to $30.12 per unit

The difference amounted to $26.74 in average monthly savings per unit

Portfolio-wide, the revised approach represented approximately $2.5 million annually in more equitable billing

These results clearly demonstrated that the shared-meter method systematically overbilled multifamily customers while underrepresenting true usage patterns.

By modeling water and sewer charges on a per-unit basis, we demonstrated how small methodological changes can translate into meaningful financial relief. For multifamily tenants, the impact isn’t theoretical—it translates into hundreds of dollars per year in avoided overcharges.

Robbi Dickens

Risk and Compliance Senior Manager at EisnerAmper

Outcome

EisnerAmper’s analysis supported the development and adoption of a new multifamily per-unit minimum billing structure, aligning local practice with national water rate standards. The updated structure applies the same base allocation and volumetric charges used for single-family homes—now distributed equitably across each residential unit.

This transition provided the utility with:

A defensible, transparent rate design
A structure that preserved revenue stability
A replicable policy framework consistent with industry best practices

For the client, this structure maintains revenue integrity for the utility while correcting long-standing inequities for multifamily residents and aligning charges with actual consumption patterns across their portfolio.

Impact

The engagement achieved:

55%–115% reduction in overbilling for multifamily communities
An estimated $2.5 million annual improvement in rate equity
A clear path for future collaboration between utilities, regulators, and housing providers
A replicable policy model now positioned for adoption by stakeholders across the Gulf Coast region
A demonstration of how the AWWA-based methodologies can deliver both financial fairness and regulatory alignment

Ultimately, EisnerAmper’s approach demonstrates how data-driven analysis and industry best practices can resolve complex billing inequities—creating a fairer, more transparent foundation for both utilities and the communities they serve.