Capital Credits

When you register for electric service at Big Flat Electric Cooperative, you automatically become a member-owner of our non-profit electric utility. The term “capital credits” may be new to you, but as a member-owner, capital credits reflect your ownership in the Cooperative.
 

Capital credits are unique to cooperatives. They represent the margins (capital remaining after expenses are paid) allocated to a cooperative member each year, pending Board approval.
 

Each new year, the Board reviews the finances of the Cooperative and determines what money needs to be reinvested to ensure that we can continue serving reliable energy. The Board then determines if capital credits from past years can be retired and returned to members.
 

If they determine that the financial condition of the Cooperative is satisfactory, they will “retire” (pay out) capital credits from select years. When this happens, Big Flat Electric will send members a check, based on a percentage of their electric payments during those years.
 

FREQUENTLY ASKED QUESTIONS
How Are Capital Credits Allocated?

Capital credits represent the margins allocated to a cooperative member each spring, pending board approval. The annual margins are the annual payments of cooperative members, less the cooperative’s expenses.
 

Capital credit allocation is the process in which members are “allocated” their share of the margins for the prior year. Their share is based on their patronage, which is the amount they paid for electric service that year. Members will receive their retirements (payouts) in future years as determined by the Board of Directors.
 

When Are Capital Credits Paid Out?

Each August, if the financial conditions of the Cooperative are satisfactory, the Board of Directors determines which years’ capital credits shall be retired and returned to members. Shortly thereafter, generally in October at our Annual Meeting, eligible members will receive a capital credit check from the Cooperative.  Checks not picked up at the Annual Meeting are mailed out.

Will I Automatically Receive a Capital Credit Check Each Year?

No. Members might not receive a capital credit payout if:
•    they weren’t a member during the years chosen for retirement;
•    their capital credit payout is under three dollars;
•    they took the discounted capital credit offer in the years 2012 and/or 2020;
•    they moved away and neglected to provide the Cooperative with a forwarding address.

I moved and I’m No Longer a Member. Will I Still Receive a Capital Credit Check?

When members move and discontinue service, the Cooperative may no longer be able to reach them about the status of their capital credits. If you move, be sure to update your address with our office, so you don’t miss a future payment.

Who is Entitled to the Capital Credits on My Account?

Capital credits may only be earned by, and paid out to, the person(s) who have signed the membership application and are listed on the membership account.
 

Does the Cooperative Pay Capital Credits to an Estate or Next of Kin?

Capital credits may be paid to the estate or next of kin of deceased member if the proper paperwork is completed and returned to the Cooperative.  With proper paperwork, estate capital credits are then paid as follows: Half of the total amount of allocated capital credits will be paid in full, the other half will be discounted to the present worth by applying a 12% discount rate (discount rate is subject to change).  Below is a list of required documentation:

•    Estate Capital Credit Retirement Application (application hyperlink below)
•    Estate Capital Credit Acceptance (acceptance hyperlink below)
•    Will or Personal Representative Document
•    Copy of the Death Certificate