HOUSTON – All the maintenance and amenities of living in a nice neighborhood cost a pretty penny, and all of those bills usually fall squarely on you through your homeowner's association dues. But Local 2 Investigates discovered many of you are paying thousands of dollars you don't even owe.
"Electricity, water, gas, management company … all those have gone up in the last couple of years," Cypresswood resident Brad Rendl said.
Rendl sits on the board of his neighborhood's HOA, so he understands there's little he can do about inflation.
"It's just a basic fact of life that your basic necessities just keep increasing in cost," he said.
What he can't reconcile is the hundreds of dollars the power company overcharged his homeowner's association for the neighborhood's street lights last year.
The charge is printed right on Cypresswood's monthly electric bill. It's called a "gross receipts reimbursement." The name of it's not important. What is important: They don't owe it -- and neither do dozens of subdivisions located outside the city limits.
"It's thousands of dollars a year for every homeowner's association that has street lights," said electricity broker Mike Harrington of American Enerpower.
Harrington helps businesses and neighborhoods save money on electricity, often times by finding billing errors and mistakes.
But the error causing you to be taxed on street lights inaccurately is no mistake.
"CenterPoint knows there's a problem and they're working on it," Harrington explained. "But this problem has been for years that people have been paying this."
Here's the problem: CenterPoint has assigned a 77002 ZIP code to all 395,000 street lights in the utility's coverage area, making it appear all of the lights are in downtown Houston. Thirty-nine percent, or 156,000, of them are not inside the city limits of Houston or any city, but the 77002 ZIP code means they are billed taxes as if they were.
"If you're in Cinco Ranch or 1960 or Sienna Plantation, you're going to get charged a tax as if your street lights are downtown, which is higher than if you were not," explained Harrington.
The River Park West subdivision in Fort Bend County overpaid $35,000 over four years because of the inaccurate ZIP code assigned to street lights there.
"It's not right," said Harrington.
No one from CenterPoint Energy would talk with Local 2 Investigates on camera about the issue, but by phone, a representative said it would be "administratively burdensome" to match each street light with the ZIP code of where it's actually standing. That representative also said it's your electric provider's responsibility to charge the appropriate taxes.
Electric providers said they trust that the information CenterPoint provides it is accurate.
"We rely almost solely on the information we receive from CenterPoint," Champion Energy's Michael Sullivan said.
Sullivan said Champion Energy, like most retail electric providers, use billing software. When the ZIP code CenterPoint provides for street lights is entered, the software automatically applies city taxes.
"Systems work as good as the information going in them. If the information that goes in is not good or accurate, we're probably going to have an inaccurate piece of data come out the other side," said Sullivan.
Rendl has spent the last two months trying to get more than $1,400 refunded to his neighborhood. That's the amount of tax they overpaid just in 2011. While he thinks he almost has the matter settled, he said CenterPoint should fix the ZIP codes so that the billing errors don't occur in the first place.
"I think it would be the right thing for a home town company like CenterPoint to go back and correct this mistake," he said.
Local 2 Investigates found several neighborhoods that have been successful in getting their money refunded, but it can take months and a lot of runaround. You have to start with your electric company. Since it collected the taxes from you and paid them to the state, the electric company must get the refund from the controller's office and then return it to you.
Since Local 2 Investigates brought the issue to Champion Energy's attention, it has created a spot on its website where customers who think they've been overcharged can start the process of getting a refund.
Harrington said when he makes the first call to most electric companies, the call taker will tell you that the tax is not a mistake and that you have to pay it. He said you have to be persistent and don't take no for an answer. According to Harrington, your neighborhood is entitled to the last four years of taxes it may have overpaid.
CenterPoint Energy said that every new street light installed since February 2010 will be linked with the ZIP code of where it is physically located, but the utility company has no plans to retroactively correct the ZIP codes for the street lights that existed before that date.
Local 2 Investigates contacted the Public Utility Commission. A representative said it is the retail electric provider's responsibility to bill the customer the appropriate taxes.
Full Statement from CenterPoint Energy:
"When the Texas electricity market was restructured in 2002, all market participants agreed that for administrative ease, streetlights would not be individually billed but instead would be bundled into a handful of 'ESIDs' or account numbers.
"CenterPoint Energy provides information to REPs as to how many and what type of streetlights an Homeowners Association (HOA) has for billing purposes; CenterPoint Energy does not tell Retail Electric Providers (REPs) what taxing authorities are applicable to a particular customer.
"REPs are responsible for calculating and remitting appropriate City and State Gross Receipts taxes due from their customers.
"If an REP or HOA contacts CenterPoint Energy, we will provide the REP with a zip code from the nearest substation which while not perfect, will get the majority of streetlights coded to the proper taxing authority. Again, the REP is the entity responsible for calculating and collecting appropriate taxes from their customers. If an HOA discovers that their REP has been over collecting on taxes, they can apply with the city and the state comptroller's office for a refund."