Automating Utility Cost Allocations To Tenants

Ways for property managers to automate utility cost allocations to tenants using RUBS, square footage, custom formulas, and smart billing systems to save time and reduce errors.

By BillGauge
June 23, 2025
7 min read

Allocation costs by hand is time-intensive

Utility cost allocation infographic showing automated billing process

Many property managers still use spreadsheets - particularly Excel and Google Sheets - to allocate utility costs to tenants. With multiple units, let alone hundreds or thousands, this can take up a lot of time and is also prone to errors. The process typically involves:

  • Collecting the utility bills from multiple providers
  • Calculating each tenant's share based on allocation rules (e.g. RUBS)
  • Creating individual tenant invoices
  • Tracking payments and sending reminders
  • Reconciling discrepancies and handling disputes

Larger property management companies often have dedicated staff dedicated to doing this. Even with just 10 properties, and say 100 units, it can still take take up to 20+ hours per month just to get the utility cost allocations right.

Manual Allocation Pain Points
Time Intensive:
Hours spent on calculations and invoice generation
Error Prone:
Manual calculations lead to disputes and corrections
Inconsistent:
Different staff may apply rules differently
Poor Transparency:
Tenants can't easily understand their charges

Smart Automation

BillGauge has several allocation rules built-in that work out-of-the-box. Those can be applied to any property type, whether residential or commercial. This requires no spreadsheets or manual calculations - just upload (or email) your utility bills and the system auto-extracts all the data from every bill and then handles the rest. This automated approach works particularly well for HOAs seeking to eliminate manual spreadsheet work.

Prebuilt RUBS Allocation Rules

  • Square footage-based: Calculated automatically based on unit size
  • Bedroom count: Ready-to-use rules for bedroom-based splits
  • Occupancy-based: Allocate costs by number of residents
  • Flat rate: Equal distribution across all units
  • Custom formulas: Mix and match the above or set custom amounts / percentages

Instant Setup Features

  • Import utility bills: Automated data extraction
  • Auto-matched to properties: No manual work
  • Bulk-importer properties: Easily ingest all properties at once
  • Professional invoices: Generated instantly with cost breakdowns
  • Export Export to Excel, AppFolio and more
  • Payment collection: Integrated tenant billing with Stripe

Start in minutes: BillGauge's prebuilt rules handle the most common allocation scenarios immediately. No need to spend weeks configuring complex formulas—the system includes RUBS-compliant allocation methods that work for 90% of properties right out of the box.

Common Utility Allocation Methods

The most common methods for property managers to allocate utility costs are the following:

RUBS (Ratio Utility Billing System)

RUBS allocates utility costs based on factors like square footage, number of bedrooms, or occupancy. It's the most widely used method for properties without individual meters.

Example RUBS Calculation:
Unit A (800 sq ft) pays: ($1,200 total bill × 800 sq ft) ÷ 10,000 total sq ft = $96

Flat Rate Allocation

Each unit pays the same amount (or a fixed amount) regardless of size or usage. Simple but may not reflect actual consumption patterns.

Custom Allocation Formulas

Combining multiple factors (square footage + occupancy + appliances) for more accurate allocation. May lead to a fairer distribution but also higher levels of complexity.

Automation Steps

The first step in automating the process is to process utility bills efficiently - particularly extracting the total amounts for a specific billing period and linking every utility bill to the right property.

1. Automated Bill Processing & Data Extraction

BillGauge can ingest utility bills in multiple ways:

  • Bulk upload: Process thousands of bills at once
  • Email forwarding: Automatically receive bills from utility providers or corporate utility email account
  • API integration: Direct connection to your existing systems

The system automatically extracts the key data needed for tenant cost allocation, but also all other data on every bill (from usage metrics for a specific utility to tax discounts and so on).

Utility bills are also automatically matched to the corresponding property based on the account number, address, or other identifiers.

Automated Data Extraction:

BillGauge automatically extracts all data from utility bills, including core information like:

  • • Total bill amounts
  • • Service dates and periods
  • • Usage data (kWh, gallons, etc.)
  • • Account and property identification
  • • Fee breakdowns

2. Prebuilt & Customizable Allocation Rules

Choose from ready-to-use allocation rules or customize them for each property. BillGauge includes prebuilt RUBS-compliant allocation methods:

  • Bedroom-based allocation: Prebuilt rules for units with any amount of bedrooms
  • Square footage RUBS: Automatic allocation by unit size
  • Occupancy-based: Ready-to-use rules based on number of residents
  • Flat rate distribution: Equal splits (or fixed amounts) across all units
  • Custom amounts:For instance, for commercial vs. residential, which may require different rates for unit types

No configuration needed: Most properties work perfectly with BillGauge's default bedroom and square footage allocation rules.

Split rules editor showing custom allocation formulas
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BillGauge's custom allocation rules editor. Configure allocation rules for each property or unit type, including RUBS percentages, flat rates, or custom formulas.

3. Cost Allocation per Property

Property inspector showing unit details and allocation settings
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BillGauge's property management interface. The property overview gives a detailed cost breakdown across units and tenants with automated invoice generation.

The property overview gives a detailed cost breakdown across units and tenants. Each utility can be toggled on and off there to be included in calculations.

  • Invoices are automatically generated
  • Payment emails - including payment links - are auto-generated and ready to be previewed (if necessary) and sent
  • Vacancy periods and proration settings

Bulk import capabilities make it easy to set up hundreds of properties and units at once.

4. Bulk Actions

The financial overview provides ways for property managers to download all invoices at once or send out all payment emails at once. It also includes a comprehensive overview of the payment status of all tenants and units.

  • Bills spanning multiple months are automatically handled
  • Bills with multiple utilities on them are automatically handled

All calculations are transparent and auditable, with detailed breakdowns available for tenant inquiries. These can be optionally included on invoices and payment emails as well.

Bulk financial operations showing automated calculations
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BillGauge's bulk financial operations interface. The financial overview provides ways for property managers to download all invoices at once or send out all payment emails at once.

5. PMS Integration & Exports

Export interface showing integration with property management systems
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BillGauge's export and integration options. Export allocated costs, tenant invoices and payments easily to CSV/Excel, AppFolio, Buildium, Yardi, or via API endpoints.

Allocated costs, tenant invoices and payments are easily extracted from Billgauge's platform:

  • CSV/Excel export: Compatible with any system
  • AppFolio integration: Direct data transfer
  • Buildium integration: Seamless synchronization
  • Yardi integration: Automated posting
  • API endpoints: Custom integrations

Automated scheduling through the API, for instance, ensures your property management system is always up-to-date with the latest allocations. For organizations managing extensive portfolios, our comprehensive guide on processing thousands of utility bills at scale provides additional insights into advanced automation workflows.

Benefits of Smart Automation

Time Savings

Reduce allocation time from hours to minutes. Process 1,000+ units in the time it used to take for 50.

Accuracy

Eliminate calculation errors and ensure consistent application of allocation rules across all properties.

Transparency

Provide tenants with detailed breakdowns of their utility charges, reducing disputes and inquiries.

Scalability

Handle growing portfolios without proportional increases in staff or processing time.

Real-World Cost Savings

Example: 300-Unit Portfolio

Manual Process:

  • • 40 hours/month staff time
  • • $20/hour × 40 hours = $800/month
  • • $9,600 annual labor cost
  • • Plus error correction time
  • • Plus tenant dispute resolution

Automated Process:

  • • 2 hours/month monitoring
  • • $20/hour × 2 hours = $40/month
  • • $480 annual labor cost
  • • Minimal errors or disputes
  • $9,120 annual savings

Getting Started with Automated Allocation

1

Property Setup

On Billgauge, import your property and unit data, including square footage, tenant information, and current allocation rules. This can be done manually in tthe interface or through the bulk importer. We also gladly handle any onboarding - please contact us.

2

Configure Rules

Set up allocation rules for each property or unit type, including RUBS percentages, flat rates, or custom formulas.

3

Process Bills

Upload utility bills or set up automatic forwarding from your utility providers.

4

Review & Export

Review automated calculations and export tenant invoices to your property management system.

Transform Your Utility Allocation Process

Automating utility cost allocations isn't just about saving time—it's about creating a more accurate, transparent, and scalable process that benefits both property managers and tenants. With BillGauge, you can eliminate a lot of manual work, reduce errors, and focus on growing your property management business.

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