Contact Public Utilities and let them know what happened. They'll see the excessive bill, and will require you to furnish documentation of the repair. The water usage will be monitored for the next two months ... and after it drops to normal levels, the account holder will be issued a refund or credit. Whoever usually pays the bill has to fork over the excessive amount ... but if it's the result of a burst pipe or other non-negligent incident, all will work out over the following months. I hoe this helps.
I would suggest the tenant pay the bill as it is likely in their name and this does not effect their credit down the road. Document everything and then speak to an attorney or take the landlord to small claims court. Maybe they could speak to the water company as well.
Bernstein Realty, Inc.