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:
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Tenants not monitoring/filling tanks responsibly, leading to no-heat situations, frozen pipes, or property damage.
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Tenants putting the wrong fuel in the tanks (kerosene, diesel blends, etc.) or using unreliable vendors.
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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:
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How did you structure it?
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Did you require automatic delivery/service contracts?
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Did you keep tanks/accounts in the park’s name or tenant’s name?
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Did you use an escrow or monthly heating fee system?
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Any lessons learned or things you would do differently?
Appreciate any insight from owners/managers who have dealt with this.