Beginning July 1, 2014, several changes will occur to customer utility bills. Please see the descriptions
below for rate and tax modifications. There are no water or sewer rate increases planned for 2014.
Electric Sales Tax
The NC General Assembly, as part of their Tax Simplification and Reduction Act that was passed last
year, implemented HB 998 to modify how retail electricity is taxed, moving the entire tax charge to the
retail billed amount. It should be noted that this change affects all electric customers in North Carolina
regardless of power provider. Previously, electric customers paid tax on both wholesale and retail
electricity. The wholesale tax (3.22%) was built into the cost of the electricity, and the retail sales tax
(3%) was listed as a separate line item on customer bills.
Accordingly, residential and commercial customers across the State will see an increase of 4% in North
Carolina state sales tax (for a total of 7% retail sales tax) on their electric bills. Please note that this
change does not affect industrial customers who are not charged North Carolina state sales tax on
electric use.
Electric Wholesale Pass-through (Residential & Commercial)
Wholesale power charges have also increased for the City of Gastonia. Wholesale electric rates for
residential and commercial customers will increase 5.3% from our power supplier. However, due to the
tax law changes passed by the North Carolina General Assembly, the wholesale pass-through rate for
residential and commercial customers will average only 2.1% in order to mitigate costs for our
customers.
When combined with the additional 4% increase in retail sales tax, the average residential and/or
commercial customer will see a net increase of 5% to 6% in their electric bill.
Electric Wholesale Pass-through (Industrial)
Wholesale power costs have increased 5.3% from our power supplier. As a reminder, industrial
customers are not charged North Carolina state sales tax on electric and therefore not affected by the
tax increase. Therefore, industrial rates will see an average increase of 4.5% to 5%.
Stormwater Fee
The City of Gastonia will increase the stormwater utility fee from $2.75 to $3.25 per ERU. This increase
of 50-cents per ERU is the first increase to this fee in 12 years and the additional funds will be used to
expedite projects on the Off Right-of-Way Assistance Program list. This program assists property owners
with stormwater related problems on their property.