Yes to reporting, but not unusual. I take it that they have sold the collection to a collection agency or junk debt buyer for pennies on the dollar. They will soft pull you ever so often, and when they notice an increase of your scores, that indicates to them you are more financially well off to pay the bill, or be a thorn in your side knowing you are rebuilding your credit. Your best plan of action is to get a pay for delete, as this "now" reporting will hurt your scores, and more damaging to mortgage scores.
If you can go back over bank statements the month and the next two months after to see if you did in fact paid the remaining balance. If so, dispute as paid with documentation.
If not, contact who ever holds the debt, and tell them you were never sent a bill for remaining balance, was 2 years ago, no dunning notice in mail, just being reporting on bureau. If a small amount, tell them you will paid in full under condition that they will remove debt as such on all bureaus. (Not mark as paid collection), fully removed. Seems oversight on both parties, you didn't get a bill from Utility company, and they didn't sent any correspondence that you had a bill in collections.
To get an idea if a collection agency who can google collection agency and pay for delete, it will probably direct you back here, but you can get an idea if they are easy to work with on PFD, or not.
