City is widening road in front of clients house and temporarily cut off access to irrigation.  City told client to have a temporary line installed and to send City the receipts for amounts she paid and City would reimburse her.  She did and they did. 

End of year City sends client 1099-NEC for the amount reimbursed ($700).  Now, as I see it, she has to report it as income from business or hobby  or?  I question it.  She contacts City that she is neither a contractor nor a hobbyist, simply did what they told her to do.  City reissues a CORRECTED 1099-NEC with boxes 1-5 and 7 blank (which is correct according to I. Now, as I determined, she does not need to report the 'income', but retains the 1099-NEC and receipts if taxing agencies have any questions. So far so good. 

My questions are: In the event a City or any other entity required to file 1099-NEC/Misc did not want to revise or correct the 1099 would it be 'reasonable' to file a Sched C with $700 income and $700 expenses for a net zero.  Is there a different way this could have been handled other than Corrected -NEC/MISC or filing a Sched C.  thanks