Returning $2.4 Million in Capital Credits
Season’s greetings from your friends at Nolin RECC!
As an early holiday surprise for many of you, I am pleased to announce that Nolin is retiring nearly $2.4 million of previously allocated capital credits for years 1990 and 2018. This means that any of you who were members of Nolin RECC during 1990 or 2018, and received a capital credit allocation for those years, can expect to receive a bill credit or a check in the mail by sometime later this month or in January. Because it has been a few years since Nolin’s last capital credit retirement,
and because we have many new members who will be receiving a retirement for the first time, I’d like to take this opportunity to explain to each of you the value of your membership
and how capital credits work.
How capital credits work
We take our mission of providing safe, affordable and reliable service to our members very seriously. We regularly analyze our organization and processes to ensure that we are good stewards of the trust and financial investment of our members. Nolin RECC is considered a not-for-profit organization. Like any business, we have many expenses through our normal course of activity. This includes things like the purchasing of wholesale electricity from our power provider, paying debt service on loans, buying materials for constructing and maintaining poles and lines, and payroll for our employees. It also includes all operating expenses ranging from office supplies to the fuel and parts needed to keep our fleet vehicles running.
To cover the cost of the expenses, each of you who receive electric service from us pay a monthly bill. The regulated electric rates that are in place are designed to allow for
enough revenue to offset our expenses and satisfy the covenants associated with our loan agreements. When we have remaining amounts of revenue after all expenses are paid, these are not considered profits; they are known as margins. The amount of these margins in any given year equal the amount of capital credits that are allocated to you. For many reasons, these margins may be needed as capital to address immediate reliability or maintenance concerns, repairs from a major outage event, or to cover the cost of an uptick in new construction projects. Therefore, at some point after an allocation, when the financial position of the cooperative is such that we can return the margins to you, a general retirement of capital credits will be made and you will receive those funds.
Generally speaking, the amount of the capital credit retirement you receive is determined by the amount of your electric bills. This entitles you to your fair share of the margin distribution. Ultimately, however, your allocation is wholly dependent on what remains after expenses have been paid.
Capital credits for estates
As has been the case historically, a discounted retirement of any accumulated capital credits is payable to the estate of deceased members. Application for discounted retirement can be made by an authorized representative of the estate. Call us or stop by our Elizabethtown or Radcliff office for more information.
Unless you need to contact us about a deceased member’s estate, you do not have to do anything to receive your allocation. We simply wanted to do our part to educate all of our members on the value of your membership. If you have any questions about how capital credits work, call our office at (270) 765-6153.
From all of us at Nolin RECC, we wish you and your family all the best this Christmas season.