Currents-March 2021

MARCH 2021

Suwannee Valley

CURRENTS

A YEAR IN REVIEW 2020 Annual Report

INSIDE:

BY THE NUMBERS Check out the highlights from another successful year for SVEC 2020 MEETING MINUTES Read the minutes from the 2020 annual meeting FINANCIAL REPORT SVEC continues to have strong financial footing in 2021

CEO’S MESSAGE

Suwannee Valley

CURRENTS March 2021

Michael S. McWaters Executive V.P./CEO

Suwannee Valley Currents is a monthly newsletter published by Suwannee Valley Electric Cooperative, © 2021. It is distributed without charge to all consumermembers of the cooperative.

Looking out for you Electric cooperatives aren’t like other businesses. For one, we don’t operate for profit, so we can make decisions based solely on what is best for our consumer-members. Also, cooperatives are democratic organizations controlled by the people we serve, and we are dedicated to keeping you informed about the business of our cooperative so you can better understand the choices we make.

It’s also a matter of accountability. It is important for our consumer-members to know what occurs at their cooperative and that we are answerable to you.

That sense of accountability is one of the reasons we hold an annual meeting.

We also feel we have a responsibility to consider the safety and well-being of our members in everything we do. Therefore, in light of the continuing pandemic and in accordance with the CDC’s recommendation to avoid crowds, we will not hold our customary meeting at the Suwannee County Coliseum this year.

Instead, the Board of Trustees will gather as a small group at SVEC’s headquarters on April 24. While members will not be able to attend in person, the entire meeting will be streamed live on Facebook and our website. You can find more details about how members can participate in the meeting via Limited Proxy on the last page of this report and in a letter you will receive in early April.

I, for one, can say that I will deeply miss the opportunity to come together as a cooperative, and hope we will be able to do so once again soon.

As in every annual report, you can find SVEC’s financial statements for the past year, as well as the minutes of last year’s annual meeting. I think you’ll be pleased to see that our cooperative continues to operate on a strong financial footing, and it is well-positioned to offer safe, affordable and reliable power for years to come.

This year, I’m particularly proud of our employees for their dedication to building a safe workplace. In 2020, we had no injuries that required medical treatment. That was just the second time for this achievement in SVEC’s 84-year history. Our team accomplished this while responding to more than 20,000 calls from members, and we even pitched in to help some sister cooperatives repair their systems during an historically active hurricane season.

We also continued to provide support to local students through member-driven programs like Operation Round Up, while returning millions of dollars to members in the form of capital credits and wholesale power cost adjustments. And throughout all that, we managed to maintain and strengthen our electric system so that the average SVEC consumer had power 99.6% of the time.

2020 was undoubtedly a challenging one for every member of our community. But during that adversity, we also saw the strength of the cooperative model and of our electric system. I look forward to seeing all the ways we will be able to work together and achieve even more in the coming year.  2 | March 2021

WE BELONG TO THOSE WE SERVE Business Office: 800-447-4509 11340 100th St. Live Oak, FL 32060 Lobby Hours: 8 a.m.-4:30 p.m., Monday-Friday Drive-thru Kiosk Open 24 Hours 24/7 Power Outage Reporting 800-752-0025 svec-coop.com facebook.com/sveccoop @SVEC_COOP_FL Instagram.com/sveccoop SVEC is an equal opportunity provider and employer.

On the cover: SVEC employees faced many obstacles in 2020 but persevered to have another successful year. See highlights, Page 4.

Suwannee Valley Currents

2020 HIGHLIGHTS At your service SVEC employees earned an average customer service rating of 4.7 out of 5, while handling over 20,000 calls from members and completing 598 new service connections.

Safety is #1 Employees experienced no doctortreated injuries for only the second time in the cooperative’s 84-year history.

Continued reliability Hard work, best maintenance practices and investments in new infrastructure resulted in another year of highly-reliable service. The average SVEC consumer had power 99.6% of the time.

Operation Round Up® continues to benefit students In Round Up’s second year, participating members provided $97,520 in grants used by teachers to purchase equipment and materials for local classrooms.

Lending a helping hand

It’s the members’ money

Line and right-of-way crews helped five cooperatives in Alabama, Georgia and Louisiana restore power after hurricanes Sally, Delta and Zeta.

The co-op returned $1.3 million in retired capital credits and $5.1 million in wholesale power cost adjustments (WPCA) to members.

New generator program SVEC became a Generac® Energy Alliance Partner, enabling the co-op’s consumermembers to purchase whole-house automatic standby generators at special discounted prices. Extended warranties are also available for the most frequently purchased generator size. Visit svec-coop.com/member-services/standby-generators for more information.

Suwannee Valley Currents

March 2021 | 3

2020

SAFETY

365

BY THE NUMBERS

days with NO doctor-treated injuries

MEMBER EXPERIENCE

4.7 out of 5

$$

average customer service rating

8,633

bill payments using 24-hour drive-thru kiosk

OUTREACH TO COMMUNITY

$11,000

in scholarships awarded to high school seniors

$97,520

donated to schools through Operation Round Up

4 | March 2021

54 community organizations supported

$

236,180 electronic bill payments

$34,000 in in-kind donations

$14,683

raised for United Way

Suwannee Valley Currents

RELIABILITY

99.6%

average service availability

530

1,160

poles replaced

4,210

lightning arrestors repositioned for added reliability

equipment inspections

ECONOMIC VIABILITY

$4.52

$29.5M

average daily electric bill

returned via WPCA since 2014

$5.1M

(less than the $5.15 price of a Chick-fil-A grilled chicken sandwich)

returned to members via WPCA in 2020

$1.3M

capital credits retired/returned to members in 2020

$16M

capital credits returned lifetime

POWER SUPPLY

9%

renewable energy

Suwannee Valley Currents

(growing to

13% by 2024)

March 2021 | 5

Balance Sheets

BALANCE SHEETS DECEMBER 31, 2020 AND 2019 SUWANNEE VALLEY ELECTRIC COOPERATIVE, INC. - LIVE OAK, FLORIDA

ASSETS 2020 Utility Plant Electric Plant in Service Construction Work in Process

$

(Accumulated Provision for Depreciation) Total Utility Plant

2019

166,265,906 2,166,206 168,432,112 (54,103,570) 114,328,542

$

161,121,848 1,484,896 162,606,744 (50,899,938) 111,706,806

Other Property an d In vestmen ts at Cost or Stated Value Investments in Associated Organizations and Other funds Notes Receivable Total Other Property and Investments at Cost or Stated Value

15,984,382 0 15,984,382

15,267,297 0 15,267,297

Curren t Assets Cash - General Accounts Receivable Unbilled Revenues Materials and Supplies Other Current and Accrued Assets Total Curren t Assets

6,498,168 3,473,384 1,614,020 874,644 373,857 12,834,073

1,134,275 3,490,333 1,480,810 797,079 130,214 7,032,711

453,604

892,878

Deferred Charges Total Assets

$

143,600,600

$

134,899,692

EQUITIES AND LIABILITIES 2020 Equities Memberships Patronage Capital Other Comprehensive Income Total Equities

$

101,060 60,808,602 219,767 61,129,429

2019 $

98,280 58,780,406 296,827 59,175,513

Lon g-term Debt Notes payable, net of current maturities Capital Lease Obligations Post-retirement Benefit Obligation Total Lon g-term Debt

66,771,302 1,413,702 628,184 68,813,187

53,456,919 1,658,804 553,514 55,669,237

Current Portion of Long-term Debt Current Portion of Capital Lease Obligations Line of Credit Accounts Payable - Purchased Power Accounts Payable - Other Overbilled Wholesale Power Cost Adjustment Consumer Deposits Accrued Employee Compensated Absences Other Current Liabilities Total Current Liabilities

3,269,562 429,846 0 2,762,783 374,968 1,364,890 1,499,112 1,820,130 775,231 12,296,523

3,089,690 555,783 7,000,000 3,047,065 307,861 1,009,340 1,338,323 1,564,263 974,447 18,886,772

1,361,461

1,168,169

Deferred Credits Total Equities and Liabilities

$

143,600,600

$

134,899,691

FINANCIAL STATEMENTS ARE UNAUDITED. AUDITED FINANCIAL STATEMENTS WERE UNAVAILABLE AT TIME OF PRINT.

6 | March 2021

Suwannee Valley Currents

Statements of Revenue and Patronage Capital

STATEMENTS OF REVENUE AND PATRONAGE CAPITAL FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 SUWANNEE VALLEY ELECTRIC COOPERATIVE, INC. - LIVE OAK, FLORIDA

Amount

2020

December 31, %

Amount

2019

%

Increase (Decrease)

Operating Revenue

57,428,100

100.0

60,011,891

100.0

$ (2,583,791)

Operating Expenses Cost of Purchased Power Distribution - Operations Distribution - Maintenance Consumer Accounts Selling Expense Administrative and General Depreciation and Amortization (Total Operating Expenses)

34,809,717 2,444,894 5,518,007 1,592,867 36,624 3,791,527 5,518,426 53,712,062

60.6 4.3 9.6 2.8 0.1 6.6 9.6 93.5

37,028,501 2,489,809 6,170,927 1,766,990 31,722 3,946,900 5,319,224 56,754,073

61.7 4.1 10.3 2.9 0.1 6.6 8.9 94.6

(2,218,784) (44,915) (652,920) (174,123) 4,902 (155,373) 199,202 (3,042,011)

Operating Margins Before Fixed Charges

3,716,038

6.5

3,257,818

5.4

458,220

Fixed Charges (Interest on Long-term Debt)

2,293,335

4.0

2,421,996

4.0

(128,661)

Operating Margins After Fixed Charges

1,422,703

2.5

835,822

1.4

586,881

898,770

1.6

1,419,405

2.4

(520,635)

2,321,473

4.0

2,255,227

3.8

66,246

292,970 476,178 769,148

0.5 0.8 1.3

377,173 96,179 473,352

0.6 0.2 0.8

3,090,622

5.4

2,728,579

4.5

(84,203) 379,999 295,796 0 362,042

G & T and Other Capital Credits Net Operating Margins Nonoperating Income Interest Income

Other Nonoperating Income (Loss)

Total Nonoperating Margins Net Margins

FINANCIAL STATEMENTS ARE UNAUDITED. AUDITED FINANCIAL STATEMENTS WERE UNAVAILABLE AT TIME OF PRINT.

Suwannee Valley Currents

March 2021 | 7

APRIL 25, 2020

MINUTES OF ANNUAL MEETING OF MEMBERS Suwannee Valley Electric Cooperative, Inc’s annual membership meeting was held Saturday, April 25, 2020. Due to increased community preparedness and prevention measures to help contain COVID-19; and pursuant to Governor DeSantis’ Executive Orders declaring a state of emergency in Florida; and CDC guidelines to avoid gatherings of more than ten people; registration for 2020’s annual meeting was held via drive-thru lanes on SVEC’s campus, which was followed by a virtual business meeting live-streamed to consumer-members.

The business meeting was called to order at 11:00 a.m. by Executive V.P. and CEO, Michael McWaters.

Mr. McWaters welcomed members and thanked all veterans, healthcare workers, first responders, front-line employees, SVEC employees with employment milestones and all SVEC employees who are working during the current COVID-19 crisis to provide essential services. Special recognition was given to Mr. Andy Lawrence and Ms. Vicky Talmadge. After the welcome, Mr. McWaters led the pledge of allegiance and gave an invocation.

Mr. McWaters called on Tyler Putnal, President of the Board of Trustees, to deliver the President’s Address. After Mr. Putnal’s remarks, Mr. Joshua Crapps, legal counsel to the board of trustees, announced quorum status had been reached with 1,026 registered members, read the official notice of mailing, and read the minutes from 2019’s annual meeting.

After Mr. Crapps completed the reading of the minutes, Mr. Putnal asked if there were any objections to the minutes being approved as read. Hearing none, Mr. Putnal declared that the 2019 annual meeting minutes were approved by acclamation.

Ms. Christine Moor, Chief Financial Officer of SVEC, was called upon to give the financial report. Ms. Moor presented financial data from SVEC’s 2019 audited financial statements.

Mr. Crapps returned to the podium to report on district nominations. Mr. Crapps reported that meetings were held at district level for districts 1, 2 and 3. Mr. Crapps placed in nomination those Trustees nominated at district meetings: District 1 - Mr. Mike Adams; District 2 - Mr. Jerry Goff; and District 3 - Mr. Sam Roberson. No other persons submitted notice of their intent to be nominated from the floor.

Since there were no other nominations, Mr. Crapps announced that the Trustees nominated would be elected by acclamation. Mr. Adams, Mr. Goff and Mr. Roberson were duly elected to the Board.

Mr. Putnal called for any old business to be brought before the membership. Hearing none, Mr. Putnal called for any new business. Hearing none, Mr. Putnal adjourned the meeting. SVEC’s 83rd Annual Meeting concluded at 11:30 a.m.

Following the conclusion of the business meeting, Mr. Putnal asked Mr. McWaters to conduct a brief question and answer period with the members. 

2021 Annual Meeting With everyone’s health and safety in mind, the Annual Meeting will be held in a different format again this year. The Board of Trustees will gather at 10:00 a.m., April 24, on the Co-op’s campus to hold the meeting.

While members will not be able to attend the meeting in person, it will be streamed live on Facebook and SVEC’s website.

Additionally, a summary of the meeting including election results will be posted on our website the week of April 26.

In early April, members will receive a Limited Proxy/ballot form in the mail, enabling them to appoint Joshua D. Crapps, outside counsel to the board of trustees, or his designee as their official proxy. The Proxy can be used to direct Mr. Crapps on how to vote on the approval of the 2020 annual meeting minutes, proposed revisions to the Bylaws and the election of trustees for Districts 4, 5 and 6.

Members who return their Limited Proxy by April 19 to the firm tabulating the votes will be entered into a drawing for one of many gift cards.