Your Share of $2 Million in Capital Credits Coming in May Thanks to a $2 million capital credits retirement approved by the board of directors, 52,000 active members and 16,000 past members will receive capital credits refunds in May. Members qualifying for a capital credits refund of $25 or more will receive a check mailed separately from their electric bill. Those qualifying for a refund of less than $25 will receive a credit on their electric bill received in May. Capital credits are a unique benefit for members of cooperative businesses and represent your ownership in Blue Ridge Electric.
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As a cooperative, Blue Ridge Electric doesn’t earn profits. Instead, any revenues remaining after all expenses have been paid each year are considered “margins” that are eventually returned to the members after first being used for a period of time for the electric system. Each member’s share of annual margins (which is based on the amount of electricity they used and purchased) is assigned to a special account in their name. The funds then become known as “capital credits.” Capital credits are used over the years as capital to help finance major long-term reliability projects. This helps offset the need to borrow funds, thereby helping keep your electricity rates lower. It also helps maintain a healthy balance between debt and equity to ensure your cooperative’s financial health and stability as well as to ensure you receive reliable electricity delivered with outstanding member service. Each year, your board evaluates the return of a percentage of capital credits to members based on the cooperative’s financial condition. Over the history of Blue Ridge Electric, more than $33 million (including this year’s refund) in capital credits has been refunded. Look for your capital credits check or bill credit this May. We’re pleased to be sending these funds and providing value directly to those who use our services: the local members of Blue Ridge Electric!
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We want members to be well informed about capital credits because it represents your ownership in Blue Ridge Electric. We also want you to be aware of the money coming back to you in this year’s $2 million capital credits retirement approved by your board of directors (see page 1 for details). Capital credits may be an unusual term but they’re a key member benefit. Until capital credits are returned to the members, they are invested in power lines, transformers, substations, and other assets that provide you with reliable electric service. Capital credits are the margins — the revenues minus expenses of the cooperative — allocated to each member based on your usage and purchase of electricity. About 75 percent of each year’s margins are retained for a period of time for use as capital to maintain the electric system. The remaining 25 percent is used to return capital credits to members. There’s a larger story behind capital credits, however. To assure your return of capital credits and the fiscal health of your cooperative, your board of directors has approved an equity management plan. The plan sets a goal for a member equity level of 35 to 40 percent of assets. It includes a schedule for the regular return of member equity in the form of capital credits. A cooperative’s equity level is one of the best indicators of its financial health because it reflects the maintenance of an appropriate level of equity or
One of the unique benefits of cooperative membership is having an electric service provider that works to provide you with the best value. The capital credits program used by cooperatives is one of the best examples.
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Members Benefit from Capital Credits
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member investment in the cooperative. Our members currently have just over 36 percent equity invested in the cooperative, which is $123.7 million out of $341.5 million in total assets.
The equity plan also guides your board in making decisions about key financial issues. It allows the cooperative to generate adequate capital to fund growth and operations without retaining member funds any longer than necessary. Money to operate a cooperative comes from two sources: the amount members pay for electric service and long-term loans. Our goal is to maintain a balance of member equity and debt in order to give members the lowest possible cost for service over the long term. The equity plan determines how much of the cooperative’s investment in electric system assets will be covered through member rates and how much will be covered by loans. It also helps us meet financial requirements of our lenders. Since the inception of Blue Ridge Electric, $33,457,334 (including this year’s refund) in capital credits has been returned to members through annual capital credits retirements. We’re pleased to be sending money back to you this May. We think that’s something to celebrate as one of the ways Blue Ridge Electric provides value to our members, now and in the future!
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The Benefit of Capital Credits A key business principle of a cooperative is providing “at cost” service to its consumers, which means cooperatives don’t exist to earn a profit. In a cooperative, there is no stock to be purchased or sold; the members are the owners of the business. Capital credits represent your ownership in Blue Ridge Electric and they’re one of the benefits of belonging to a cooperative. What happens to my capital credits if I move or am no longer a member?
Your capital credits remain on our records in your name and member number until they are retired. To ensure you receive your capital credits refund, you should always alert Blue Ridge Electric of any address changes. What happens to the Capital Credits of a member who dies?
The executor of a deceased member’s estate should contact the cooperative to request the capital credits. There are two choices: remain in the normal capital credits retirement schedule and receive a percentage each year or they may be paid immediately at net present value. The executor must submit a Certification of Entitlement form and a copy of the death certificate.
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More News Look for it in your mailbox mid-May!
Director Elections Include Vote-by-Mail Option One advantage of being served by a cooperative is your right to elect peers (other members) to serve on the board of directors to lead and guide your cooperative. Starting with this year’s election, a new option is being offered to members ― the ability to vote-by-mail for board candidates. While members may still attend and vote for directors at the Annual Membership Meeting held each year on the second Saturday in June, the new vote-by-mail option is designed to provide the opportunity for more members to be involved in their cooperative. With a service area stretching from the foothills into the mountains and across seven counties combined with busy family schedules, voting by mail gives members who can’t attend the annual meeting a convenient way to vote for their board of directors. Look for director election materials to arrive in your mailbox in mid-May. Biographical information on all candidates and a proxy for members to make their selection will be inside. In order to be valid, the form must be signed by the member, with selections clearly marked, and the form returned in the enclosed postage-paid envelope by the date specified in the packet. The proxy must be mailed; it cannot be given to an employee or accepted at any Blue Ridge office due to proper election management procedures. To ensure the integrity of the new vote-by-mail process, a third-party election management firm was selected by the Credentials and Election Committee in December 2010. Made up of members from across the cooperative’s service area, this committee is responsible for ensuring elections are properly conducted and for certifying the results. Included in your director election mailing will also be your cooperative’s annual report and Annual Membership Meeting notice.
An Appalachian Summer Festival
Fireworks Concert with Dierks Bentley Saturday, July 23, at 7:30 p.m.
Kidd-Brewer Stadium, Appalachian State University Gates open at 6:30 p.m. Adult tickets with Blue Ridge Electric member discount - $27 (regularly $32) Children’s tickets - $5 *All tickets must be purchased through ASU
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Members Only NEWS
~For Members of Blue Ridge Electric
CORPORATE OFFICE PO Box 112 • Lenoir, NC 28645
CHIEF EXECUTIVE OFFICER Doug Johnson EDITOR Renée R. Whitener PRODUCTION SUPERVISOR Susan Simmons DISTRICT OFFICES Caldwell (828) 754-9071 Watauga (828) 264-8894 Ashe (336) 246-7138 Alleghany (336) 372-4646 Toll Free (800) 451-5474 (800) 448-2383 PowerLine® (PowerLine® is an automated account information and outage reporting system.) To report an outage at any time, call one of the numbers listed above. OFFICE HOURS 8:30 am - 5:00 pm, Monday - Friday Night deposit available.
May is National Electrical Safety Month On Mother’s Day, children sometimes sneak into the kitchen to whip up a surprise breakfast for mom. It’s always a treat to wake up to the smell of breakfast cooking — eggs, bacon, and, of course, toast. And mom’s smile more than makes up for the disaster zone normally left in the wake. But did you know that a third of all home fires start in the kitchen? May isn’t only a time to honor mothers — it’s also National Electrical Safety Month. Please take the time this month to check your home for electrical hazards. Spending a few minutes to check for problems can make all the difference when you’re faced with a potentially unsafe situation. To learn more, take a home safety tour at www.virtualhome.esfi.org. There’s also a wealth of safety knowledge available at www.SafetyatHome.com, and www.SafeElectricity.org. On Mother’s Day and every day, we want to help you keep your family safe. Sharing electrical safety tips is just another way we’re looking out for you.
Air Conditioning Tips Keep the thermostat clear of heat. Don’t position heatproducing devices such as lamps and TVs close to your thermostat. Heat from these devices could cause the thermostat to read a temperature higher than the true room temperature. This may lead to excessive cooling and wasted energy.
Visit us on the Web: www.BlueRidgeEMC.com
You should also keep vents clear. Keep furniture and drapes away from air vents. This allows the cool air to move out into the rooms and keeps your air conditioner from running more than necessary.
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