June Message from the Manager
You get the credit
Burke-Divide Electric Cooperative (BDEC) isn’t like other utilities. You, as a consumer and a member, own the business.
BDEC operates at cost, collecting enough revenue to operate and expand the business with no need to raise rates to generate profits for distant shareholders. Any money left over from revenues after all operating expenses are deducted are called margins by cooperatives.
Each year, these margins are allocated, or credited, to members receiving electrical service. Money allocated back to you and other members is called capital credits. When the co-op’s financial position permits, the co-op retires, or pays, the capital credits to members.
The retirement of capital credits – so-called because members provide capital to the cooperative for it to operate and expand – depends on the co-op’s financial status. Strong and consistent equity levels are one key aspect of financial strength. So it’s essential for a co-op to maintain the right balance between retiring capital credits to members and retaining sufficient equity on its balance sheet.
Burke-Divide Electric Cooperative holds onto allocated capital credits to cover emergencies, such as a natural disaster, and other unexpected events, and to expand its electric system, all of which may require large-scale construction of poles and wires.This action decreases the need to raise rates or borrow money to pay for the infrastructure. After a number of years, if financial conditions permit, the cooperative may decide to retire a set amount of capital credits.
At this year’s annual meeting, Burke-Divide Electric Cooperative will be retiring capital credits for the remaining balance of 2000 and all of 2001 totaling $840,981.65. We hope to see you at the annual meeting on June 14 to personally present you with your capital credit check!
As of 2016 year-end, Burke-Divide Electric Cooperative has retired $8,851,276 in capital credits to our member-owners since the cooperative was formed in 1945.
Until next time,