If you receive power from an electric cooperative, you are a member and an owner of a not-for-profit business. As a not-for-profit electric cooperative, CFEMC is not only owned by the people it serves – its members – it also returns surplus to our member-owners. No other business form has this characteristic.
These surplus revenues are called margins and are assigned to each member’s “capital credit” account annually. This allocation is based on how much business they did with the cooperative that year or, in other words, how much electricity they used. Their capital credit account represents the member ownership or equity in the cooperative. The money is reinvested in the cooperative until it is returned to them in the form of CFEMC’s planned general retirement of capital credits.
Unlike investor-owned utilities that operate on a for-profit basis to make a return on investment to their shareholders, cooperatives charge just enough to cover expenses and a slight margin. Margins allow CFEMC to meet financial obligations to our lenders, and reinvest in the co-op by building lines, buying equipment and system maintenance, and they are used to reduce the need for borrowing 100 percent for those
system improvements.
In August, CFEMC’s Board approved this year’s Equity Management and Capital Credit Retirement Plan. Keeping with a 20-year cycle, we will be refunding operating margins and non-operating margins from 2004, operating margins from 2006, and 25 percent of operating margins from 2023 totaling $3 million in member capital credits.
Approximately 48,000 capital credit checks will be mailed in October to members receiving refunds of $10 or more. Additionally, 35,000 members with refunds of less than $10 were issued a bill credit on their August or September statement depending on their bill cycle. With this refund, CFEMC has returned over $54 million in member capital credits since 1994.
When capital credit refunds are issued, they are automatically sent to the name and last known address in our records. Many of the checks are returned to us because they cannot be delivered. We make every effort to locate the intended recipient or the executor of the estate if the
member is deceased; however, to ensure you check delivery, members should be sure to update their address if or when, they plan on moving residences.
For more information or to learn more about how capital credits work, contact the CFEMC Member Services Department
at 770-502-0226 or visit utility.org/capital-credits.