Colorado quietly resolved one of the most contested questions in multifamily utility billing this spring. Colorado HB26-1013, signed into law on March 26, 2026, settles the legal status of Ratio Utility Billing Systems (RUBS) in Colorado and sets a future deadline for direct metering on new construction. Both provisions matter for owners, operators, and developers with Colorado exposure – and the second one has real implications for how you design your next project.
Here’s what changed, what to plan for, and how we can help.
Colorado HB26-1013: RUBS Is Lawful (With Guardrails)
HB26-1013 was passed in direct response to ambiguity created by HB25-1090, Colorado’s price transparency law, which left the industry uncertain whether RUBS was still permitted. The new law amends Section 6-1-737 of the Colorado Revised Statutes to make clear that allocating utility costs among tenants via RUBS is allowed – provided four conditions are met:
- No overbilling. The aggregate amount billed to all tenants cannot exceed the total amount the utility provider charged for service to the premises.
- No markup. Landlords cannot add a margin on top of the actual utility charges. RUBS is a pass-through mechanism, not a revenue line.
- Common-area costs excluded. Utility consumption attributable to common areas must be excluded from the resident allocation pool.
- Clear and conspicuous disclosure. The allocation method has to be disclosed in the lease or a lease addendum, in language a resident can actually understand.
Existing properties using RUBS today should treat this as a compliance checkpoint rather than a green light. Most established operators already meet the no-overbilling and no-markup standards, but common-area exclusion and lease disclosure language are the two areas where we most often see gaps when we onboard new portfolios. If you’re not 100% sure your Colorado RUBS program is dialed in to all four guardrails, this is the moment to find out, and we can run that audit for you.
For the full legal picture, including the price transparency law, the lease fee cap, and master meter rules for gas and electric, see our guide to Colorado utility billing regulations.
New Construction: Direct Metering Required Starting July 2027
The second provision is forward-looking. For residential premises with building permits applied for on or after July 1, 2027, gas, electric, and water service must be either:
- Direct-metered by the utility provider, or
- Submetered at the unit level.
RUBS is not a permitted billing method for these properties. Importantly, the trigger date is keyed to the permit application, not to certificate of occupancy or first move-in. A project that pulls permits in June 2027 and delivers in 2029 can still be billed via RUBS. One that pulls permits a month later cannot.
For developers with active Colorado pipelines, that distinction is worth a calendar entry on the entitlements team and a conversation with your submetering partner well before design development locks. (For a broader look at the planning sequence, see our post on planning tenant utility billing for new construction or conversion.)
Designing for the Submetering Mandate: Where Most Projects Fall Short
For most Colorado new construction, electric submetering is already standard practice. Water submetering is typically the gap. Many developers have historically master-metered water and recovered cost via RUBS, which the 2027 trigger forecloses. Adding water submetering to a project after design development is significantly more expensive than designing it in from the start.
This is exactly the kind of project where the cost of getting submetering right is set in the first few weeks of design and locked in for the life of the building. Our team designs and supplies water, electric, and gas submetering systems specifically for multifamily and we work with developers and MEP engineers during schematic design to make sure the meter layouts, sizing, and read infrastructure work for both code compliance and long-term operational cost.
A few of the design decisions we help clients work through:
- Gas submetering is the trickiest of the three from an installation and code-compliance standpoint. The choice between diaphragm and rotary meters, regulator placement, and venting requirements all need to be settled early. We’ve designed gas systems across a range of building configurations and can help you avoid the rework that comes from getting any of those wrong.
- Water submetering design depends heavily on whether you’re running a manifold layout or in-wall stub-outs, and on the cold/hot configuration. Both have real cost and accuracy tradeoffs.
- Electric submetering is the most standardized of the three, but choice of meter (revenue-grade vs. sub-billing-grade), communication protocol, and integration with your billing and resident-portal systems still matter for the long-term operational picture.
In every case, the goal is the same: a system that’s accurate, code-compliant, integrates cleanly with the billing platform, and doesn’t surprise you with maintenance costs five years in.
Staying Ahead and Getting It Right the First Time
We track legislative and regulatory developments across the states where our clients operate, including emerging price transparency, submetering mandates, and disclosure rules. Colorado is the most recent example, but similar conversations are active in several other jurisdictions and the design and procurement decisions you make today will determine whether you’re ready when those rules land.
Whether you need a RUBS compliance audit on your existing Colorado properties, or a submetering system designed and installed for a project breaking ground in 2027 or beyond, we’d like to be in that conversation early. Reach out and we’ll set up a call.