My Co-op » About Us: Capital Credits
As a member-owner of Northwestern REC, you provide equity for the Cooperative. When you pay your electric bill, any amount paid in excess of the cost and expense of furnishing power creates patronage sourced margins. These margin amounts are not profits like a regular corporation. For a member-owned cooperative, these margin amounts represent each member’s capital contributions (i.e. capital credits) which are used by the Cooperative to build utility plant, make improvements and fund capital spending projects.
Member equity (in the form of capital credits) is used to leverage long term loans that finance line construction costs. You can compare it to the down payment required when buying a home. The Cooperative’s members must provide the equity or “down payment” for these loans.
Annually, the board of directors determines if the finances of the Cooperative permit a retirement, of previously allocated capital credits and then determines the method and priority of payment if any.
The needs of long term members, new members and past members as well as the Cooperative’s financial condition are taken into consideration when determing the method of retirement.
Due to the expenses involved, you will not receive a check for less than $5.00. Amounts of less than $5.00 will be accumulated until the amount does exceed $5.00. Also, members having unpaid charges will have their refund applied against those amounts.
If you move from Northwestern REC’s lines, it is important to advise the office of your new address in order to continue receiving your capital credit checks. Call Northwestern REC at 1-800-472-7910.
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