Give Residents Maintenance Charge List to Discourage Unit Damage

To discourage residents from damaging their units and to make it easier to get current residents to reimburse you for the cost of repairing damage they’ve caused, you should have available a list of repairs your maintenance staff perform most often and how much those repairs cost. The list should be given to residents to let them know that they’ll be responsible for reimbursing you if you incur these costs because of damage they caused. If a resident knows how much a repair will cost her, she might think twice before damaging her unit. The list has the added benefit of keeping the resident from claiming that you charged her more than you charged someone else for the same work.

We’ll tell you how to prepare and distribute your own maintenance charge list. We’ve provided an example of such a list. You can use it as a starting point for creating your own list.

Charging Residents for Damage Repairs

You may charge a resident for damage that she (or her visitors) cause to a unit by carelessness, misuse, or neglect [Handbook 4350.3, par. 6-25(C)(1)]. The resident is obligated to reimburse the owner for the damages within 30 days after the resident receives a bill from the owner [Handbook 4350.3, par. 6-25(C)(1)]. However, you can’t charge a resident for damage that’s caused by normal wear and tear.

What to charge. You may charge a resident only “actual and reasonable costs” for repairs [Handbook 4350.3, par. 6-25(C)(3)]. So, a maintenance charge list should include only what a repair actually costs the site. To determine how much a repair costs your site, take the following steps:

Step #1: Ask your maintenance staff how long they normally need to perform the repair;

Step #2: Multiply the time needed to perform the repair by the pay rate for maintenance staff members who typically perform that repair; and

Step #3: To the figure in Step #2, add the cost of materials needed for the repair. You can get this information from your maintenance staff or look at receipts.

For example, you determine that it normally takes a maintenance staff member 40 minutes to replace a bathroom light fixture (getting the materials, going to the unit, and doing the work). The staff member’s pay rate is $15 an hour ($10 for 40 minutes) and he uses $19 in materials. On your list, you would write that a resident has to reimburse you $29 for replacement of a bathroom light fixture.

Remember to keep documentation to back up your cost calculations in case a contract administrator or local HUD office wants to check that your charges are reasonable. It’s also wise to exclude repairs involving big ticket items on your maintenance charge list. For these repairs, you may have to prorate how much you charge a resident based on the item’s remaining useful life. So the amount you’ll charge for repairs on these types of items can vary. You can ask your contract administrator or local HUD office which items it wants you to treat like this.

Include Key Information in List

Your list, like ours, should include the following key information:

Identify site. List your site’s name at the top of the maintenance charge list.

Identify period in effect. State the year or time frame for which the charges on the list are in effect.

State resident’s damage responsibility. Tell the resident that she must reimburse you for damage that she causes to her unit by carelessness, misuse, or neglect. Explain that if the resident’s damage necessitates one of the repairs on the list, the resident will have to pay the listed charge.

List repairs and charges. List the repairs that your maintenance staff performs frequently and give the charge for each. Our list includes replacements because that’s sometimes the best way to repair an item.

Make your list specific so that both you and the resident know exactly what is charged. For example, don’t just write “bathroom repairs,” specify “refinish porcelain bathtub.” Being specific also will help you deal with repairs that may vary somewhat in cost.

For example, rather than list the repair of “a hole in the wall,” specify a cost for fixing a maximum size hole. Otherwise, don’t include repairs on the list that will vary much in cost. You’re agreeing to charge the amount set out on the list for a repair, and where there’s a lot of variation, that amount could be wrong.

Explain charges for repairs not on list. Explain that if the damage the resident causes isn’t on the list, the resident will have to reimburse your site for the repair costs. These may be what it cost to have your site’s maintenance staff perform the repair or the amount a contractor charged you for it.

Distribute List to Residents

It’s important that all current and future residents get a copy of the list. Here are some ways to distribute the list:

• Add the list to your site’s house rules;
• Refer to the list in your site’s house rules and give residents a copy;
• Create a separate list that you mail or hand-deliver to all residents;
• Incorporate the list into your site’s move-in inspection report and move-out inspection report; or
• Post the list in a public place at your site.

Ask your contract administrator or local HUD office if it has a distribution method it wants you to use. And whichever method or methods you use, make sure that all current and future residents get a copy of the list.

You’ll need to redistribute the list anytime you change it. This may happen if for some reason you must change some items on it or if you revise the list each year. If you’ve added the list to your house rules, give your residents 30 days’ notice before you start using the new list [Handbook 4350.3, par. 6-9(B)(5)] .

Use List with Former Residents, Too

HUD allows you to deduct amounts from a former resident’s security deposit to cover damage that the resident caused to her unit by her carelessness, misuse, or neglect [HUD Handbook 4350.3, par. 6-25(C)(2)]. If you perform a repair on your maintenance charge list to fix damage caused by a former resident, you can use the list to determine the amount to deduct from the security deposit.

If the former resident’s security deposit doesn’t cover the amount you spent on the repair, you can ask the resident to reimburse you for the balance. You can also use your maintenance charge list to determine the amount to charge the former resident. And if the resident doesn’t reimburse you, you can use your maintenance charge list to help prove your repair costs if you submit a damage claim for them to your contract administrator or local HUD office. To make the most persuasive case for repair costs, it’s best to submit a copy of your maintenance charge list, as well as documentation to back up your calculations.