Thinking of transitioning POH heating oil to tenants responsibility looking for opinions

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I own a mobile home park in Maine where all homes are park-owned (POH), and currently heating oil is included in the lease. With spiking oil prices, I’m considering transitioning to a tenant-paid heating model instead of continually raising rents to absorb fuel costs.

My concerns are mainly operational and liability-related:

  1. Tenants not monitoring/filling tanks responsibly, leading to no-heat situations, frozen pipes, or property damage.

  2. Tenants putting the wrong fuel in the tanks (kerosene, diesel blends, etc.) or using unreliable vendors.

  3. Finding a way to transition without scaring off good tenants or making the change feel overly burdensome.

I’m trying to think of a system that keeps tenants responsible for usage while still protecting the property and keeping things manageable operationally.

For those who have made this transition:

  • How did you structure it?

  • Did you require automatic delivery/service contracts?

  • Did you keep tanks/accounts in the park’s name or tenant’s name?

  • Did you use an escrow or monthly heating fee system?

  • Any lessons learned or things you would do differently?

Appreciate any insight from owners/managers who have dealt with this.

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I know this is a bit late, but no one’s answered yet and I’ve been researching a lot about this recently (looking to build software to help out park owners).

I think the core is protecting the property and keeping things manageable. If the tank runs dry then it becomes your problem no matter what the agreements are. So I’d lean toward you keeping control of delivery and just change who pays for it.

The safest of your options is probably keeping the accounts in the park’s name and re-billing tenants for what gets delivered. That’s simplest for auto-delivery, everything is always on time, it’s the right fuel, etc. It might go over best if you introduce a flat monthly fee with some kind of true-up or rebate every year. That amortizes the cost of the fill, doesn’t scare off tenants, and keeps the charges consistent for them while feeling like they get money back.

Curious if you already made a call here and what you ended up going with?