2020 OREMC Annual Report

OREMC - Annual Report - Option 3.pdf

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ANN UA L R E PO RT 2020

P OWERING YOUR L I F E EVERY DAY OKEFENOKE RURAL ELECTRIC MEMBERSHIP CORPORATION

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POWE R I N G ON They say hindsight is 2020, and when we look back at this year it will definitely be through a different lens than we started with.

The year began like any other with work plans, system improvements, reliability and technological upgrades, right of way maintenance and new construction all budgeted for and scheduled.

Ongoing safety trainings and professional development meetings were planned. We selected our OREMC Youth Tour delegates who would travel to our nation’s capital for the week-long Washington Youth Tour Leadership Experience in June. We looked forward to honoring our 10 OREMC Scholarship winners during their senior awards ceremonies at their respective schools.

We were working on our golf swings in preparation for the 29th Annual OREMC Golf Tournament in May. C

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Then COVID-19 hit.

In a span of just days we went from “business as usual” to closing our lobbies, shutting down drive through operations, sending our administrative staff home to telecommute and asking our lineman to stay home on standby. Only a skeleton crew of employees reported to the main office in Nahunta each day. As essential workers responsible for maintaining critical infrastructure facing an invisible, unknown threat, we quickly realized drastic steps needed to be taken to protect the health and well-being of our employees in order to continue serving you, our consumer-members.

1 | Okefenoke Rural Electric Corporation • ANNUAL REPORT 2020

Next Georgia and Florida shut down. Businesses closed. Jobs were lost. Our OREMC communities were challenged. Within days of closing to the public we took the major step of suspending late fees and power disconnects. Our goal was to provide some degree of certainty during a period of rapidly developing uncertainty. The moratorium would stretch out over 13 weeks as our local economy worked to regain its footing once things started to reopen.

Six months later, and throughout the pandemic, OREMC has powered on. Our electrical distribution system has remained operational; our lineworkers have continued to respond to storm-related outages and restore power; and our customer service representatives have remained available on the phone and at our drive-up windows—once we reopened them in early April— to answer questions and assist with payment arrangements.

Behind the scenes, other employees have worked together to maintain business continuity while working apart.

COVID-19 has been a storm of a different kind and required a different kind of response, while reminding us how important electricity is to our everyday lives. We remain functional in a modified operational state as we continue to put health and safety first. When we return to “normal” is unknown, but OREMC’s vitality as a cooperative, and your energy provider, is a direct reflection of the wellbeing of our members and communities.

Together we will work to keep your cooperative powered on.

John Middleton

Robert W. Combs

G E N E R A L M A N AG E R

PR E S ID ENT

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A YE A R I N REVIEW In October OREMC employees participated in Pink Out Friday to elevate breast cancer awareness by wearing pink as a way to honor breast cancer warriors, survivors and help promote the importance of early detection.

Our annual FFA Wiring Competition Practice Session was held in November to help students prepare for the statewide competition. A career development event, it gives students real-life work experience demonstrating the value and importance of trade careers.

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Supporting student development in science, technology, engineering and mathematics (S.T.E.M.) and building the knowledge capital in our communities, was the motivation behind OREMC donations to Brantley County High School, Camden County High School and Baker County High School S.T.E.M. programs. These donations are made possible to qualifying organizations using funds from OREMC’s unclaimed capital credits.

Team OREMC—30 employees and family members —climbed and conquered the annual Bridge Run presented by the Southeast Georgia Health System Foundation in February raising money for cancer and cardiac care.

OREMC honored local healthcare heroes by cooking and delivering a complete summer cookout to the 83 employees at BayView Nursing Home in Nahunta. The lunch was presented in recognition of, and appreciation for, their dedication and care to their patients during these unprecedented times.

ANNUAL REPORT 2020 • Okefenoke Rural Electric Corporation | 2

OREMC - Annual Report - Option 3.pdf

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C E LE BRAT ING A SAFETY M ILESTONE A N D RE N EWING O UR CO MMITM ENT On July 1, 2020, Okefenoke REMC employees achieved a significant milestone—730 days (two years) without a lost time incident. It is an accomplishment OREMC is extremely proud of and a major milepost on our journey to targeting zero lost time incidents. But achieving the standard is only part of the story, maintaining it through a “continuous growth mindset”1 is the true measure of success.

By its very nature, working in the electric utility industry can be hazardous. To mitigate the potential hazards of the job, lineworkers use specific personal protective equipment and follow detailed, national safety practice standards. As OREMC Safety Manager David Smith says, “Our goal is for our guys to go home the same way they come to work every day—whole.”

Lost time incidents are defined as any work-related accident that results in a disability or injury that causes an employee to miss work, and is a key metric in measuring the effectiveness of OREMC’s safety program. Prevention is paramount and identifying and mitigating the potential for error—or preventable harm—before it happens reducing the impact of “incidents on our people, projects, cooperative and consumer-members.” 1 C

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Smith acknowledges that hitting the two-year mark is celebration-worthy, but admits there were some close calls along the way that reinforces the need for all employees to continually review their adherence to the safety standards that exist. “The safety standards are there for each individual employee’s safety and protections, but also for the safety and protection of their coworkers. It is about respect and remembering someone at home is counting on their return at the end of the day. We are all in this together.”

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“Respect is key when it comes to recognizing hazards,” notes Jesse Hardy, CSP, CIT, CUSP in the April-May issue of Incident Prevention. Hardy points out that while good catches and close calls are effective at helping workers self-correct, the bigger issue is ensuring employees have the right attitude and mindset about safety. This is what ultimately drives behaviors and commitment to targeting zero incidents.

That is why mindfulness and learning from “good catches” are part of OREMC’s ongoing safety program. “A near miss yesterday means we got lucky,” insists Smith. “What we do with the information to change our safety processes and procedures to make sure it doesn’t happen again today, tomorrow, or any other day, means we got it right.”

So, the journey to target zero lost time incidents continues as OREMC puts safety first: taking the time, every time, every job, every day.

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Hardy, Jesse, “The Hierarchy of Incidents and Learning: Part 1,” Incident Prevention, April-May

2020, https://incident-prevention.com/ip-articles/the-hierarchy-of-incidents-and-learning-part-i

3 | Okefenoke Rural Electric Corporation • ANNUAL REPORT 2020

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FI N A NCIA L RE PO RT Financial Statements for the fiscal year ending June 30,

balance sheet, statement of revenue, expenses, and

2020, reflect the sound status of Okefenoke Rural

remarks concerning each. Copies of the complete

Electric Membership Corporation.

audit are on file at the Cooperative’s Headquarters

Each year we retain the services of independent

Office in Nahunta, Georgia, for your review.

Certified Public Accountants, to perform an audit of the

The figures presented in this report represent our

corporation’s accounting records. This year’s audit,

summary of the year’s operation.

conducted by McNair, McLemore, Middlebrooks and Co,

Cristi B. Koncz

ASSESTS

LLP included an examination of the Cooperative’s

S EC R E TA RY/ TR E A S U R E R

Utility Plant Electric Plant in Service - At Cost Construction Work in Progress Accumulated Provision for Depreciation

2020

2019

$201,943,631 1,092,382 203,036,013 (68,344,168) 134,691,845

$192,307,691 2,337,036 194,644,727 (65,172,221) 129,472,506

23,139,036 286,910 341,667 1,112,803 24,880,416

22,079,133 167,858 489,286 1,034,796 23,771,073

1,931,343 71,424

1,424,193 42,857

5,528,543 2,059,236 559,741 10,150,287

5,791,442 1,876,501 864,331 9,999,324

1,823,912

2,027,260

$171,546,460

$165,270,163

Other Property and Investments Investments in Associated Organizations Note Receivable Restricted Funds Other Investments C

Current Assets Cash and Cash Equivalents Note Receivable - Current Portion Accounts Receivable (Net of Accumulated Provision for Uncollectible Accounts of $1,089,760 in 2020 and $1,076,178 in 2019) Materials and Supplies Other

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Deferred Debits

M EM BERS' EQUITY AND LIABILITIES

Total Assets Members' Equity Memberships Patronage Capital Other Equities Long-Term Liabilities Long-Term Debt Other Liabilities Current Liabilities Long-Term Debt - Current Portion Line-of-Credit Accounts Payable Notes Payable Consumer Deposits Accrued and Withheld Taxes Other Deferred Credits Total Members' Equity and Liabilities

$

209,407 55,305,742 3,963,322 59,478,471

$

162,703 55,125,140 3,684,741 58,972,584

82,755,156 1,112,803 83,867,959

85,897,636 1,034,796 86,932,432

5,454,000 5,967,416 6,592,678 1,950,405 1,775,806 1,277,121 2,569,181

5,135,000 1,604,858 4,682,934 1,967,521 1,263,498 2,317,681

25,586,607

16,971,492

2,613,423

2,393,655

$171,546,460

$165,270,163

ANNUAL REPORT 2020 • Okefenoke Rural Electric Corporation | 4

STATEMENTS OF OPERATIONS

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Operating Revenue and Patronage Capital

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STATEMENTS OF CASH FLOWS

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$ 71,686,656

44,835,595

44,998,551

4,774,872

3,987,154

Distribution Maintenance

5,481,026

4,023,368

Consumer Accounts

2,227,950

2,432,495

398,233

416,963

Administrative and General

3,753,868

3,687,243

Depreciation

5,715,983

5,428,872

13,539 67,201,066

7,782 64,982,428

6,250,338 5,761,362

6,704,228 3,553,884

Operating Margins After Interest Expense

488,976

3,150,344

Nonoperating Margins

107,193

371,377

953,684 368,261 $1,918,114

836,608 423,222 $4,781,551

$ 1,918,114

$ 4,781,551

6,555,619 (1,321,945)

5,866,526 (1,259,830)

262,899 304,590 (132,550) 1,909,744 (191,715) 13,623 251,500 78,007 219,768 9,867,654

(195,358) (257,092) 875,617 500,440 179,078 125,562 9,475 107,336 115,760 10,849,065

(11,439,060) 236,218 (182,735) (147,619) (78,007) (11,611,203)

(10,976,963) 177,258 (279,753) 46,429 (107,336) (11,140,365)

4,362,558 46,704 358,225 (5,040,527) (1,458,931) 25,824 1,950,405 1,858,822 2,103,080

(3,639,419) 4,755 10,000,000 (5,086,848) (1,424,549) 24,333 494,696 372,968

359,531 1,913,479 $2,273,010

81,668 1,831,811 $1,913,479

Consumer Assistance and Information

Other

Operating Margins Before Interest Expense Interest Expense

Net Margins

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$ 73,451,404

Distribution Operations

Cost of Power

Other Capital Credits and Patronage Capital Allocations

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2019

Operating Expenses

Generation and Transmission Cooperative Capital Credits

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2020

Cash Flows from Operating Activities Net Margins Adjustments to Reconcile Net Margins to Net Cash Provided by Operating Activities, Depreciation and Amortization Patronage Capital from Associated Organizations Change In Accounts Receivable Other Current Assets Deferred Debits Accounts Payable Consumer Deposits Accrued and Withheld Taxes Other Current Liabilities Other Long-Term Liabilities Deferred Credits Cash Flows from Investing Activities Extension and Replacement of Plant Return of Equity from Associated Organizations Materials and Supplies Note Receivable - Rural Development Other Investments Cash Flows from Financing Activities Line-of-Credit Memberships Advances on Long-Term Debt Principal Repayments of Long-Term Debt Retirement of Patronage Capital Capital Term CertiďŹ cates Notes Payable RUS Cushion-of-Credit

Net Increase (Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents - Beginning Cash and Cash Equivalents - Ending

5 | Okefenoke Rural Electric Corporation • ANNUAL REPORT 2020

OREMC - Annual Report - Option 3.pdf

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BY THE NUMBERS

29,347 TOTAL Consumer-Members

631 NEW

Consumer-Members

56,454

Consumer-Member Calls Answered C

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3,767,099 kWh Cooperative Solar Power Produced

3,581

Miles of Line

58,910 Poles

$50,000

Scholarships and Community Contributions Est. 1939

OREMC

YEARS of SERVICE

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O K E F E N O K E R URA L EL ECTRI C M EM B ERSHI P CO RPO RATI O N

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