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2019–2020 Annual Report

1945–2020 Celebrating 75 Years


Membership in a cooperative is open to all persons who can reasonably use its services and stand willing to accept the responsibilities of membership, regardless of race, religion, gender or economic circumstances.

Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. Elected representatives (directors/trustees) are elected from among the membership and are accountable to the membership. In primary cooperatives, members have equal voting rights (one member, one vote); cooperatives at other levels are organized in a democratic manner.

Members contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital remains the common property of the cooperative. Members allocate surpluses for any or all of the following purposes: developing the cooperative; setting up reserves; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.

Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control as well as their unique identity.

Education and training for members, elected representatives (directors/trustees), CEOs and employees help them effectively contribute to the development of their cooperatives. Communications about the nature and benefits of cooperatives, particularly with the general public and opinion leaders, helps boost cooperative understanding.

By working together through local, national, regional, and international structures, cooperatives improve services, bolster local economies and deal more effectively with social and community needs.

Cooperatives work for the sustainable development of their communities through policies supported by the membership.


YOUR CO-OP NEWS

White River Electric Association, Inc. ANNUAL REPORT 2019–2020 BY RICHARD R . WELLE , PRESIDENT WREA BOARD OF DIRECTORS

RICHARD R. WELLE

H

appy 75th Anniversar y to White River Electric and to our membership. We are proud to celebrate 75 years of dedication and service to our membership and our community. Many things have changed in 75 years; our total membership has increased from a few hundred to 2,000, our annual electric demand has risen from under 500 kilowatts to over 100,000 kW and we have grown from seven to 29 employees. In 1945, a dozen eggs were 55 cents and you could buy a 1939 Ford Deluxe Sedan for $959. Gratefully, while some things have changed, the most important things have not. White River Electric is still focused on providing our membership with safe and reliable electricity and personalized customer service. Your calls are not only answered in person, but you probably know the voice on the other end of the line. Never in a million years did we contemplate our 75th annual celebration would be virtual. While this may not be ideal, the board determined to err on the side of caution as we kept the health and safety of our membership at the forefront of our decision. My guess is that in 1945 the founding WREA Board of Directors could not have conceived of a virtual annual meeting, let alone online bill pay! Adaptability may not be a part of our written mission statement, but it is what electric cooperatives have done throughout our history. We will adapt and focus on

the positives; remembering that it is a privilege to celebrate with you all no matter the venue. In that spirit, we are pleased to invite you to join us on Wednesday, September 9, 2020, at 1 p.m. to attend our first ever virtual annual meeting. A link to the annual meeting presentation will be available on that date by visiting our website at www.wrea.org. The annual meeting video will be 10-15 minutes in length and will remain on our website so you can also watch as your schedule allows. The WREA Annual Meeting is an essential function and important tradition for us. Our bylaws state that our annual meeting shall take place in September and shall include the election of directors. This year’s online meeting will be a condensed version of our normal agenda including a financial report and the election of two directors from the Town of Meeker District. As allowed by our bylaws and Colorado cooperative law, the election will consist solely of mail-in or hand delivered ballots. The appointed election clerks and judges will oversee the election and the ballots will be counted on September 9, 2020. Results will be posted in the normal fashion; on the front door of the WREA office, at www. wrea.org and on the WREA Facebook page after the ballots are counted. In January, our wholesale power supplier, Tri-State Generation and Transmission announced that it would close Colowyo Coal Mine and the Craig Station power

plant by 2030. These difficult decisions were driven by state regulation and a shift in the cost of regional generation. As a member of Tri-State, White River Electric struggled with these announcements as we recognized the personal nature of these impacts. White River Electric is committed to remain a voice for our region as we work with Tri-State and other community leaders to support our economy and our membership during this transition. When I adjourned last year’s annual meeting, I couldn’t imagine the changes that would come to our valley over the subsequent 12 months. I want to thank WREA’s management team and staff for their hard work and perseverance in the last year. Regional wildfires, the COVID-19 pandemic, decline in electric loads and the board’s directive to cut costs in order to keep rates stable but maintain reliability and customer service were met with the “can do” spirit that defines this organization. Thank you to our membership for your continued support and your patience as we navigate the complicated changes facing our industry, including a shift in generation resources. White River Electric’s success reflects the support we receive from our membership and our outstanding staff. On behalf of the WREA Board of Directors, we wish you health and good fortune in the year to come.

COLOR ADO COUNTRY LIFE SEPTEMBER 2020

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YOUR CO-OP NEWS

Celebrating 75 YEARS Together BY ALAN MICHALEWICZ,

GENER AL MANAGER

C

ongratulations to White River Electric and our membership on your 75th anniversary. Things rarely go according to plan, but it goes without saying that no one could have planned for the events of 2020. We hope this finds you healthy and weathering these complicated times. As a nation and a community, we are slowly finding our new normal. As a company we continue to focus on our priorities which include serving our membership safe and reliable electricity with the highest degree of customer service. During the onset of the pandemic, our front office was temporarily closed to the public but thanks to technology we remained fully staffed and operational. We appreciate our members support and patience as we adapted to more online and phone services. To help support our members, we accelerated the scheduled capital credit payments from August to April so that members could receive WREA capital credit dollars as soon as possible. In August, payments representing Tri-State G&T‘s capital credits were issued as well. With the health, safety and wellbeing of our membership in mind, the WREA Board of Directors decided to pivot from an in-person annual meeting to our first ever virtual annual meeting. The good news is that it will be the shortest annual meeting in history, but the bad news is we will all miss the Lion’s Club lunch. Tradition, comradery with members and the youth presentations will be also be missed but don’t worry, we won’t forgo member gifts. Following the virtual annual meeting, WREA will draw names for boxes of meat purchased from the RBC livestock sale and all members can claim their membership gift — a camp chair with the WREA 75th anniversary logo — at designated pick-up times. Pick up details were sent in the annual meeting notice

8

COLOR ADO COUNTRY LIFE SEPTEMBER 2020

and are available on the WREA website. Our members participation in the annual meeting is critical to our success and we hope that you participate by mailing in your ballot for the election of two Town of Meeker directors and join us for the online presentation on September 9. The 75th anniversary has us walking down memory lane with a look back into the WREA archives. WREA’s Articles of Incorporation were signed on November 5, 1945, just two months after the official end of World War II. Our 11 founding board members were ready to move beyond the war years to a more prosperous chapter which included electrifying the White River Valley. Over the next 10 years WREA expanded service into Powell Park, Strawberry and up the valley along County Road 8. President Franklin D. Roosevelt signed Executive Order 7037 in 1935 establishing the Rural Electrification Administration (REA). That order led the way for the newly formed WREA to buy existing generation and distribution facilities from the Town of Meeker, which were previously owned by Meeker Power & Light. WREA’s first loan in the amount of $410,000 (equal to about $5.6 million dollars today) was used to buy existing assets and fund the expansion of services within town and into the rural areas. White River Electric originally included the town of Rangely but less than a year after incorporation, WREA sold the Rangely assets to Rangely Power & Light for $27,000. Our founding members’ pioneering and western spirit lives on at White River Electric today. Beyond COVID-19, 2020 is proving itself to be a challenging year. Regional fires have recently impacted our system with the loss of several miles of transmission and distribution lines. We want to thank our members for

ALAN MICHALEWICZ

their patience and our neighbors at Yampa Valley Electric Association who, without hesitation, joined our rebuilding efforts. As you know, in January Tri-State Generation & Transmission made announcements regarding the future of regional electric generation. Regulatory pressures drove the decisions to close Colowyo Coal Mine and the Craig Station Power Plant over the next 10 years and we recognize the difficult impact this will have on our communities, friends and family. White River Electric will continue to work with Rio Blanco County, the Town of Meeker and Tri-State to support our members and community during this transition. WREA FINANCES, AUDIT & RATES: Our 2020 finances look different from those in 1945 but our board of directors’ conservative approach remains the same. WREA has worked hard to control costs through efficiencies and is pleased to announce there will not be a rate increase in 2020. Rate stability remains a key priority. The independent auditing firm of Jackson Thornton & Co. PC completed last year’s financial audit. The audit, which is reviewed and approved by the board, confirmed no irregularities or material weaknesses in the internal control structure or operations of the company. WREA continues to meet its financial targets and retains a strong equity position at 72% of total assets. WREA’s 2019 operating margins equaled $1,043,426; WREA’s operating revenue equaled $62,747,528; and the total utility plant equaled $44,364,833. WREA SAFETY & RELIABILITY: Safety is our priority and more than a motto.


YOUR CO-OP NEWS WREA has gone two years without a losttime accident and WREA’s safety program now includes reasonable COVID-19 protocols for employees and members while continuing to focus on electric and cyber safety. Reliability remains at 99%, which reflects the hard work and dedication of our operational team and line crews. Thank you to our crews for all that they do to keep the lights on. MEMBER SERVICES & OUR COMMUNITY: WREA conducts a member survey every two years and over 300 members participated this year. The survey results show member satisfaction at 90% and that rate stability is a priority. Member surveys are a great way for WREA to hear directly from the members but please don’t wait for the next survey to share your opinions. We welcome comments, good and bad, and use that information to continually improve our organization. Through this year’s challenges we have grown stronger as a community and a company. Our small-town values, support for one another in times of challenge and the ability to “socially distance” in our scenic valley reminds us how fortunate we are to call Meeker home. THANK YOU TO OUR MEMBERS, OUR BOARD OF DIRECTORS & OUR EMPLOYEES: We won’t even dare “plan” for next year’s annual meeting, but we hope it will be back in person at the Fairfield Center. There is no company that I would rather represent and no community I would rather be in during times of challenge than White River Electric and Meeker. Our board of directors has been steadfast in its commitment to our members and has gone the extra mile to ensure we get the job done and keep the lights on. Thank you to our board and our employees; this team is what makes White River Electric an exceptional organization. We wish you all the very best, including good health, in the coming year.

WHITE RIVER ELECTRIC ASSOCIATION, INC. Virtual Annual Meeting of the Membership and Director Election

September 9, 2020 12:00 pm

Director election voting closes. All mail-in or hand delivered ballots must be received by noon.

1:00 p.m.

Virtual annual meeting begins at www.wrea.org/annual-meeting

OFFICIAL BALLOT SEPTEMBER 9, 2020

ANNUAL MEETING OF THE MEMBERS WHITE RIVER ELECTRIC ASSOCIATION, INC. VOTE "X" FOR TWO

TOWN DISTRICT – THREE YEAR TERM HAL W. PEARCE (INCUMBENT) BRETT W. DEARMAN BRYCE R. DUCEY

SERVICE AWARDS

5 Years of Service

Congratulations to the following individuals for achieving milestones in their years of service to our cooperative.

Kimberly Dungan Employee – 5 years

Richard R. Welle Director – 5 years

COLOR ADO COUNTRY LIFE SEPTEMBER 2020

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YOUR CO-OP NEWS

BOARD OF DIRECTORS

Hal W. Pearce

Mark A. Rogers

Richard R. Welle

Richard L. Parr

Ronald K. Hilkey

Stan Wyatt

William H. Jordan

Thank you for your service to the community! FINANCIALS: ASSETS & OPERATING REVENUES TWO YEAR COMPARISON Assets

CO-OP FACTS/ BUSINESS INFORMATION

2018

2019

Year Incorporated

Total utility plant

$43,078,465

$44,364,833

Power supplier

Accumulated depreciation

-$13,320,254

-$13,681,582

$29,758,211

$30,683,251

Total revenue sales

$62,747,528 $53,480,244 810,036,600

Net utility plant

1945 Tri-State Generation & Transmission

Other property and investments

$48,905,180

$48,531,645

Total cost of wholesale power

Currents assets

$11,282,770

$11,567,616

Total kWh sold

Deferred debits

$1,981,905

$1,446,410

Maximum kW demand

113,563

$91,928,066

$92,228,922

Average cost/500 kWh

71.50

TOTAL ASSETS

Average cost per kWh

0.11300

2018

2019

Property tax paid

Margins and equities

$69,261,811

$66,617,616

Number of employees

Long-term debt

$8,761,725

$10,458,227

Total payroll

Current liabilities

$12,426,946

$13,637,156

Total utility plant

$44,364,833

$1,477,584

$1,515,923

Total assets as of December 31, 2019

$92,228,922

$91,928,066

$92,228,922

Miles of line

Equities & Liabilities

Other credits TOTAL EQUITY & LIABILITIES

$262,854 29 $6,111,183

1,030

Meters Served 3,391 Operating Report

2018

2019

OPERATING REVENUES

$68,171,883

$62,747,528

Cost of Power

$59,395,683

$53,480,244

Operating Expenses

$6,711,534

$6,814,371

Depreciation

$1,076,117

$1,100,582

Interest

$349,859

$389,493

Other Expenses

$30,600

-$80,588

$67,563,793

$61,704,102

$608,091

$1,043,426

Interest Income

$61,038

$82,554

Non-operating margins

$17,617

-$121,867

$2,249,797

$931,752

$0

$0

$2,936,541

$1,935,866

TOTAL EXPENSES Operating Margins

Patronage Capital Credits Extraordinary item TOTAL MARGINS

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COLOR ADO COUNTRY LIFE SEPTEMBER 2020

WHERE THE MONEY GOES

Purchased Power 86.67%

Operations & Maintenance 5.07% Administration & General 4.97% Consumer Accounting 0.90% Depreciation 1.78% Long Term Interest 0.61%


CAPITAL CREDITS PAID BY WHITE RIVER ELECTRIC ASSOCIATION TO DATE Year

Credits for

Amount paid

1981

1955

$11,703.54

1983

1956-1957

$19,177.79

1984

1958-1959

$67,258.43

1985

1960-1961

$46,297.32

1986

50% of 1962

$30,206.27

1987

50% of 1962

$3,020.84

1989

1963

$51,266.23

1990

1967-1969

$78,904.96

1992

1970

$92,595.97

1993

1971

$76,787.65

1994

1972

$81,348.68

1995

1973/1974/1977

$128,969.65

1996

1978-1979

$79,833.03

1997

1980

$102,325.38

1998

1981 & 335 of 1982

$130,564.85

1999

67% of 1982

$192,564.85

2000

33% of 1983

$106,490.95

2001

33% of 1983

$109,037.83

2002

33% of 1983

$108,099.82

2003

1984-1985

$257,922.17

2004

1987

$142,366.92

2005

1988

$139,930.22

2006

1989-1990

$146,699.88

2007

25% of 1991

$105,012.13

2008

25% of 1991

$105,012.13

2009

50% of 1991

$210,170.48

2010

1992

$285,455.76

2011

1993-1994

$1,092,720.65

2012

1995 & 25% of 1996

$562,610.82

2013

75% of 1996

$543,251.63

2014

1999-2000

$1,104,010.68

2015

2001

$1,266,154.10

2016

2002

$1,133,347.09

2017

1997-1998

$1,248,238.34

2018

25% of 2003

$1,058,585.24

2019

75% of 2003

$792,174.72

2020

2004, 2005, 2006

$1,047,590.15

YEARS NOT LISTED ARE YEARS WITH NO MARGINS


MISSION STATEMENT White River Electric Association, Inc., strives to provide its member-consumers with safe, reliable and responsible electric energy and other services at the most reasonable costs possible while remaining committed to customer and community service.

WHITE RIVER ELECTRIC ASSOCIATION, INC. Mailing Address: P.O. Box 958, Meeker, CO 81641-0958 Street Address: 233 6th Street, Meeker, CO 81641 ph: 970-878-5041 • tf: 800-734-9809 • fx: 970-878-5766 email: wrea@wrea.org • web: www.wrea.org

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