Several hours after Elizabeth City announced Tuesday it would defy Gov. Roy Cooper’s executive order banning residential utility disconnections, the state announced the city would be granted a waiver from the order.

Attorney General Josh Stein’s decision to grant the waiver means delinquent city residential utility customers will have to pay their July bill or face disconnection by the end of the month.

City Manager Rich Olson announced Tuesday morning, and a day before the first of July’s bills were set to be mailed, that the city would defy Cooper’s executive order halting disconnection of utility services during the COVID-19 pandemic.

That order was set to expire July 29 but because of more than 2,200 delinquent utility accounts, the city was set to run out of money in its electric fund by August.

“I think we were going down a very similar path together, and, unfortunately, the city had walked ahead of the Attorney General’s Office because of the needs of our utility system,” Olson said. “Unfortunately, the Attorney General’s Office had to catch up to us.”

The city applied for a waiver from Cooper’s executive order from Stein on June 15 but never received a decision, which Olson on Tuesday morning called “unfortunate.”

“We were hoping that something was going to come late Friday afternoon (of last week),” Olson said before the waiver was granted. “Nothing came, and nothing came Monday.’’

After being informed of Elizabeth City’s intentions to defy Cooper’s executive order, Attorney General’s Office spokesman Ahmed Nazneen said, “Our office has been in frequent communication with representatives of Elizabeth City and we expect to be responding again soon.”

Shortly after, Deputy General Counsel Blake Thomas of Stein’s office sent a letter to the city stating the waiver had been granted.

After hearing the city would defy Cooper, and before the state granted the conditional waiver, State Treasurer Dale Folwell voiced his support for Elizabeth City’s decision.

“I’m disappointed that the unintended economic consequences of Executive Order 142 are not being considered,” Folwell said in a press release. “I believe that elected city councils and county commissions know their customers better than people in Raleigh and for decades they have come up with fair and equitable solutions that will not bankrupt the utilities, cities or its citizens. All hearts pump blood, but theirs also pump compassion.”

With the first of July’s bills set to go out Wednesday, Olson said Tuesday morning the city couldn’t wait any longer for Stein’s office to decide on the waiver.

“We thought 15 days was adequate for the governor and the attorney general to grant us a waiver,” Olson said Tuesday, explaining the decision to defy the governor’s executive order. “The city is in a cash position where we need to take immediate action. We submitted everything they requested in a timely fashion, and we still had not heard anything back from them. We were forced to take the action that we have taken.”

The city is expecting to generate more than $2.5 million in revenue from its July billings. Olson said July’s billings could allow the city’s electric fund to have enough money to pay its bills.

“We hope so,” Olson said. “What we need is to get the cash infusion in by people paying their July bills. That should stop the bleeding.’’

The first set of four cycles of bills will go out today with a due date of July 15. If a customer with a July 15 bill-due date does not pay by then they could be charged late fees before facing disconnection on July 25. Other customers will receive their bills over the course of July with different due dates.

All billings for July are due on their normal due dates, city officials said. The city will establish catch-up agreements with customers for any billings that were due between March 23 and June 30 once the July payment is satisfied.

Under those catchup agreements, payments will be set at a maximum of $100, even if it results in the agreement extending beyond the six months as currently required by Cooper’s executive order.

A customer, however, may receive an exemption from paying their July bill on the due date and still set up a COVID agreement. Eligible customers would have to show, under penalty of perjury, that they are unemployed and not receiving unemployment compensation or that they or an immediate family member has contracted coronavirus.

The city had around 220 hardship agreements in place on March 31 when Cooper’s first executive order banning utility disconnections went into effect. Those agreements will resume as normal beginning today. Those customers can also receive a COVID agreement and the total catchup amount will still be $100 or less.

Olson said when delinquent customers start making catchup payments in addition to paying their monthly utility bill, the city will have a path forward for stabilizing its utility funds.

“What we need to do is get the new cash infusion by people paying their July bills and then get them on a COVID-19 hardship agreement with us,” Olson said.

The city’s Griffin Street satellite location, which had been closed because of the COVID-19 pandemic, will open on an appointment-only basis to assist customers in setting up hardship agreements. Customers call also call the city’s customer service Office to set up an appointment to make a hardship agreement.

“We are going to be increasing our staffing in the customer service area to allow individuals to come in and meet with us to discuss executing a hardship agreement,” Olson said.

City residents can get help paying their delinquent bills through the N.C. Department of Social Services crisis fund. Pasquotank County is expected to receive around $170,000 from the state.