Had this situation with my problem tenants and I was assured all fund would be collected. It was forced to VCAT and the PM (at the time), settled for $250 for $1300 of water bills, before it actually went to hearing. Then of course she never came back to work there again, so we were screwed. Tried to get it readdressed but because that property manager had signed it on our behalf, we were stuffed.
I also tried everthing with the water company to get them to send it to the tenants, but until they called and signed it up in their name, the bills kept coming to me (too honest to think to call up on their behalf).
I'd be getting onto your PM asap to get action taken to recoup the usage funds and have the tenants part of the bill sent to them.
NOTE....if your in the western suburbs, just check your bill, as our part is huge, without the usage added, compared to other properties I've owned in the eastern suburbs.