Elizabeth City is a Democrat stronghold. It also supplies electricity to its people. But fellow Democrat Roy Cooper has issued an executive order OKing consumer non-payment of electric bills. And THAT is causing quite a fiscal (and literal) headache for small communities all over North Carolina:
Unless collections of utility payments are allowed to resume soon, a number of utility providers in the state could be facing bankruptcy due to one of Gov. Roy Cooper’s COVID-19 related executive orders.
Cooper initially addressed utility services in Executive Order 124 on March 31, which banned utility companies from charging late fees, interest, or terminating accounts due to non-payment. It also allowed residential customers at least six months to arrange to pay any of their outstanding bills. The first order was to last 60 days and also suspended evictions. The order also applied statewide regardless of income loss due to COVID-19.
Cooper later issued EO 142 which extended the prohibitions in EO 124 on disconnecting customers and continued to bar utilities from collecting and fees, penalties, or interest for late payments. The result of these orders has been an increasing number of customers not paying their bills at all, which is causing a financial meltdown for many utility operations.
EO 142 is set to expire on July 29, 2020, which may be too late for some citizen-owned utilities, as was the case with Elizabeth City, located in Pasquotank County. The city was one of the first reported to have reached a breaking point. Facing over 2,200 delinquent utility accounts and the electric fund was set to be depleted by August, the city was also reportedly looking at electric rate increases of up to 46% to compensate.
Elizabeth City officials voted on June 8 to request that Cooper and Attorney General Josh Stein grant the city a waiver from the order. Weeks later, with no response, the city manager issued a warning in a press release.
“The Attorney General has still not granted our justifiable waiver. The Elizabeth City Council can no longer wait on Governor Cooper or AG Stein to grant the waiver,” said City Manager Rich Olson on June 30. Olson warned that the city “will start sending out bills and expect our residential customers to begin paying them under the following terms and conditions.”[…]
Yes, folks. THAT is a group of Democrats rebelling against their party’s governor. Now, let’s look at what’s happening in Cleveland County, home of House Speaker Tim Moore(R):
[…] City and town leaders continue to watch utility bills mount for residents suffering financial hardships during the pandemic.
Because of an executive order, those customers are safe from having their power or water cut off due to delayed payment, but that’s a measure that could end later this month.
A hold in cut-offs
When the pandemic hit in March, North Carolina Governor Roy Cooper ordered municipalities to stop cut-offs for non-payment and made it so that no late fees could be accrued over however long the order is in place.
On May 30, Cooper extended that order.
Last week, State Treasurer Dale R. Folwell, called on Cooper and Attorney General Josh Stein to grant waivers from Executive Order 142 for cities that operate citizen-owned utilities like ElectriCities of North Carolina. Without the waivers, some of the citizen-owned utilities could face potential bankruptcy, according to a statement from Folwell’s office.
“City councils, especially across eastern North Carolina, either have to comply with the governor’s order or violate the original debt covenants that were used to finance these utilities,” Folwell said. “The best path to avoid insolvency for these cities, is for the governor and attorney general to grant the waivers. This is in the best long-term interest of the city and its citizens.”
He added that nobody wants to turn off utilities for people who are suffering from economic distress associated with the shutdown. But Folwell believes elected city councils know their customers better than people in Raleigh and for decades have come up with fair and equitable solutions that will not bankrupt the utilities and cities.[…]
Out of the 1,700 customers the town serves, 145 of them have past due accounts. That equals to just about $18,000 in revenue. Of that amount, a little over $14,000 is for water and sewer only.
“The town has probably lost $9,000-$10,000 in late fees in the last three months since the Executive Order prohibits us from charging them,” said Rhonda Allen, finance director for Boiling Springs.
That is money the town will never recoup, and it puts a strain on things.
“When someone refuses to pay, the town is left with a deficit. In turn, this burdens our residents in several ways, primarily with a loss in revenue used to provide the highest in quality of services to everyone. We understand that times are hard but encourage residents to keep their bills current and avoid accruing a large amount that will inevitably create a financial hardship for everyone,” said Boiling Springs Town Manager Lucas Shires.
As per Cooper’s executive order, people have six months to pay back past payments via a re-payment program once the order is lifted. Right now Boiling Springs is seeing interest in the program.
“We have had a few customers tell us that they are interested, but since the Executive Order has not expired, we have not signed anyone up for a payment plan yet. Once we know what everyone’s final outstanding balance is, we plan to set our customers up on payment plans,” Allen said.[….]
Kings Mountain will not recoup more than $144,000 in late fees and administration fees, according to city manager Marilyn Sellers.
“The greatest impact are the closing and cutbacks of our industrial/commercial customers which have a great impact on our utility revenues. That is also revenue that will never be recovered,” she said.
Not including the industrial and commercial customers, 269 households are behind on their bills and only 24 have already set-up payment plans to start once the executive order is expected to end on July 29.[…]