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Panel backs bill allowing municipalities to file liens for unpaid master‑metered apartment utility bills, banks’ priority protected
Summary
Senate bill 63, as amended to preserve mortgage priority, would create a municipal lien for unpaid water and sewer charges at multifamily properties that use master meters; supporters said the measure aims to prevent tenants from being displaced when property managers fail to remit collected utility funds.
The Senate Committee on Local and Municipal Affairs voted to report favorably on SB63 after adopting an amendment preserving the priority of recorded mortgages, a change that addressed concerns raised by the Louisiana Bankers Association.
Sen. Jenkins, sponsor of the bill, told the committee the measure creates a limited municipal lien that allows a city or parish to record a claim against real property owned by a multifamily housing complex that uses a master meter when the owner or manager fails to remit tenant‑collected water and sewer payments. Jenkins said municipalities sometimes face large unpaid utility balances when management companies collect tenants’ rent but do not forward utility payments.
William Daniel, former water and sewer director for the city of Shreveport, described tactics he saw in practice: property owners would transfer ownership to a related entity following notices and bills, “effectively wiping out the debt,” and older apartment buildings with leaks could quickly accumulate large unpaid balances. He said shutting off water to complexes forced municipalities to help relocate tenants who had paid rent and were directly harmed.
Sen. Morris offered amendment set 14‑42 after banks raised concerns that a municipal lien might outrank an existing mortgage. The amendment clarifies that the municipal utility lien will not impair the priority of previously recorded mortgages, addressing the bankers’ priority concern.
Supporters said the lien is narrowly targeted to multifamily properties with master meters and would provide municipalities a recovery mechanism short of mass service disconnections and tenant displacement. The committee adopted the amendment and reported SB63 favorably as amended.
The bill will now move to the Senate floor for further consideration.
