SB 1076 — Rocky Mount/Louisburg Utility Rev./Advisory.

GENERAL ASSEMBLY OF NORTH CAROLINA SESSION 2025 S 21 SENATE BILL 1076 State and Local Government Committee Substitute Adopted 5/12/26 Short Title:

LimitRocky Electric/NaturalMount/Limit GasElectric Power Revenue Uses.

Senators Barnes, B.

Newton, and Moffitt (Primary Sponsors).

Rules and Operations of the Senate May 6, 2026 A BILL TO BE ENTITLED AN ACT TO PROHIBIT THE CITY OF ROCKY MOUNT FROM TRANSFERRING THE REVENUES OF ITS ELECTRIC ANDSYSTEM NATURAL GAS SYSTEMS TO OTHER MUNICIPAL FUNDS;FUNDS.

TO PROHIBIT THE TOWN OF LOUISBURG FROM TRANSFERRING THE REVENUES OF ITS ELECTRIC SYSTEM TO OTHER MUNICIPAL FUNDS;

AND TO DISALLOW THE TOWN OF LOUISBURG FROM USING REVENUE DERIVED FROM RATES FOR ELECTRIC SERVICE FOR ECONOMIC DEVELOPMENT PROJECTS.

SECTION 1.(a)1. G.S.

G.S.

*S1076-v-2* General Assembly Of North Carolina Session 2025 (7) Making payments in lieu of taxes to other governmental units to reflect property taxes that would have been collected by the other governmental unit if the municipality were not the owner of the electric system.

*S1076-v-1* General Assembly Of North Carolina Session 2025 (c) The total amount transferred to other funds of the municipality authorized as a rate of return on the investment of the municipality in the electric system shall be calculated using amounts reported in the municipality's audited financial statements for the preceding fiscal year.

Apex, Ayden, Belhaven, Benson, Clayton, Edenton, Elizabeth City, Farmville, Fremont, Greenville, Hamilton, Hertford, Hobgood, Hookerton, Kinston, LaGrange, Laurinburg, Louisburg, Lumberton, New Bern, Pikeville, Red Springs, Robersonville, Rocky Mount, Scotland Neck, Selma, Smithfield, Southport, Tarboro, Wake Forest, Washington, and Wilson." SECTION 1.(b)2. This section applies onlyto the City of RockyMount and the Town of Louisburg.

SECTIONThis 2.act applies only to the City of Rocky Mount.

S.L.

2021-103 is repealed.

ArticleThis 16act ofbecomes Chaptereffective 160AJuly of1, the2026. General Statutes is amended by adding a new section to read:

"§Page 160A-314.2.2 Senate Bill 1076-First Edition

Permitted uses of revenue from natural gas rates.

(a) A municipality that operates a natural gas utility shall use revenue derived from rates for natural gas service to pay the direct and indirect costs of operating the natural gas system.

Any remaining revenue shall be used to produce lower rates on natural gas service within the area served by the municipal natural gas system and to make additional debt service payments on bonds or other indebtedness incurred by the municipality to finance improvements to the natural gas system.

A municipality shall not otherwise transfer revenue from a natural gas utility fund to anyother fund of the municipalityfor any other purpose not explicitly authorized bylaw.

(b) The direct and indirect costs of operating the natural gas system include all of the following:

(1) Debt service payments on indebtedness incurred for the natural gas system or secured by revenues of the natural gas system.

(2) Capital improvements or equipment for the natural gas system.

(3) Debt service, maintenance, renewal, and replacement or other reserves required by legal documents entered into by the municipality in connection with the issuance of bonds or other indebtedness for the natural gas system.

(4) Reserves deemed necessary by the governing body of the municipality to assure that funds are available to maintain the financial and operational integrity of the natural gas system.

(5) Maintaining a rate stabilization fund to minimize the impact of periodic rate changes that would otherwise be required to reflect changes in costs of operations and demand for natural gas service.

Page 2 Senate Bill 1076-Second Edition General Assembly Of North Carolina Session 2025 (6) Making payments in lieu of taxes to other governmental units to reflect property taxes that would have been collected by the other governmental unit if the municipality were not the owner of the natural gas system.

(7) Making transfers to the general fund or other funds of the municipality to reimburse the general fund or other funds for costs paid from the fund that are reasonably allocable to the natural gas system.

(c) The restrictions in this section shall not apply to any action required to be taken for a municipality by the Local Government Commission in accordance with G.S.

159-181(c).

(d) This section applies only to the City of Rocky Mount." SECTION 4.

This act is effective when it becomes law.

Senate Bill 1076-Second Edition Page 3