Tri-County EMC Board Elects to Refund $1 Million in Capital Credits

In December 2018, Tri-County EMC’s board of directors elected to retire $1 million in capital credits to the cooperative’s existing and former members who received electric service from 1976 to 1993. These capital credit refunds will appear as credits on the bills of current members. The line item on the bill will be labeled, “Capital Credits - 1976 to 1993“. Former members, no longer receiving service from Tri-County EMC, will be mailed a check if their refund is at least $10. The amount of each refund is determined by the amount of the bill during the years retired.

As a not-for-profit “cooperative” organization, our member-owners take part in the cooperative’s business. Our members elect a board of directors and vote on important issues such as bylaw changes. And they also participate financially. While most businesses seek to make “profits”, cooperatives are different, required by lenders to maintain only a small “margin” above the cost to provide service. Tri-County EMC members, existing or former, have an account that tracks their margins.

Co-ops are capital intensive businesses requiring large amounts of materials and equipment to grow and maintain reliable service. As an alternative to borrowing from banks or other lenders, that small margin is reinvested in the utility for a period of time, a practice that has been followed since the formation of electric cooperatives in the 1930s. Periodically, the board of directors elects to retire these margins, called “capital credits”, back to the member’s accounts where it originated.

“Returning capital credits to the member-owners is the cooperative way of doing business. It’s one of the things that makes us unique.” said Brenda P. Green, chairman of the EMC’s board of directors. “Tri-County is in a strong, healthy financial position, therefore the board of directors is pleased to be able to approve the single largest refund in co-op history to our members.”

At the end of each year, the board of directors carefully assesses the financial condition of the cooperative and decides what amount, if any, of capital credits to retire. Since 1980, Tri-County EMC has retired $9.2 million in capital credits. The $1 million dollar refund for 2018 is the highest in the history of the cooperative.

It is often difficult to locate former members who have moved away from the Tri-County’s service area. Should you move, we highly recommend that you provide a forwarding address and keep us updated of further address changes. Unclaimed credits are held by the cooperative for five years as we attempt to locate former members. A list of unclaimed capital credits is provided on the cooperative’s website each year.

 

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