Claim Your Capital Credits
Giving money back to our cooperative members is a vital cooperative principle, and we hope you also see it as a great benefit of being part of a cooperative. At the end of February, we sent our members a “green” letter regarding the Board of Directors approving a capital credits refund. This letter contains a place for you to sign and a return envelope to send it back to our office; it’s vital you do this so we can issue your Capital Credits.
The name “capital credits” may sound complex, but it’s a simple concept. Capital credits are the annual margins—revenues minus expenses of the cooperative—allocated to each member based on their individual purchase and use of electricity. Until they’re returned to members, capital credits are funds used as operating capital to invest in power lines, substations, and other electric system assets that provide all JOEMC members with reliable electricity. After using the money for a period of years to finance investments in electric facilities, it is returned to our members.
To assure your return of capital credits and the fiscal health of your cooperative, your Board of Directors has approved and put into place an equity management plan. The plan uses an industry-best standard that looks at the percentage of member equity to total assets. It includes a schedule for the regular return of member equity in the form of capital credits.
The equity plan also determines how much of the cooperative’s investment in electric system assets will be covered through member capital and how much will be covered by long-term debt. Our goal is to balance member capital (equity) and debt to give members the lowest possible rates.
This year, the capital credit refund authorization (almost $2.4 million) will be for members who received electric service from JOEMC during 2000 and 2022. These refunds will consist of 100% of the remaining allocated capital credits from 2000 and 25% from 2022. All active members who received service during the years mentioned above will receive their refund in the form of a “capital credit refund” on their electric bill.
All inactive members who received service from the cooperative during those years will receive a capital credit check in the mail.
Since 1998, JOEMC has returned $39.3 million in capital credits to our members, including the one this year. Being a part of a cooperative definitely has its rewards, and we are pleased to provide our members with great value in addition to the excellent service we strive to provide.
Jeffery T. Clark, CEO