You have probably heard about capital credits, maybe even cashed a check last year from us. But have you ever wondered just what does this check from your electric cooperative really mean? Under the unique cooperative business model, earnings are calculated at the end of the year. Anything left over after operating costs and other expenses is called a margin. Over a period of time, these margins are retired, or paid back, to every consumer of the electric cooperative. This is known as a patronage capital credit.
Because you are a member in Wayne-White Counties Electric Cooperative, you own a share of your cooperative's assets. That means you own a piece of the business. Upon approval from the directors, Wayne-White returns retired margins in the form of capital credit checks. In recent years, this has occurred annually. That means every consumer receives a capital credit check based upon when you begin receiving electric service from the cooperative. Our commitment to returning profits back to our member-owners is a key element of the cooperative difference, and this unique business model.
The amount allocated back to consumers is based on the amount of electricity that each consumer paid during the year(s) that are being paid out. Most co-ops, including Wayne-White Electric, hold onto allocated capital credits for a while to invest in the co-op's electric system and to cover emergencies, such as natural disasters and other unexpected events, all of which may require new construction of power lines including poles and wire. This action helps Wayne-White provide reliable service at a stable, affordable cost.
This year, Wayne-White's board of directors has approved returning over $2 million in capital credits to our members. These capital credits will be paid out based upon member/owners who received electricity from the cooperative during the second half of 2001 to the first half of 2004. If you came on to Wayne-White Electric lines after 2004, you will not receive a capital credit check until we begin paying back the margins for the year in which your service began.
The amount allocated for capital credits for 2022 will appear on the top right of your bill on your July statement. This is not an amount you will receive this year, but once we begin paying out for the year 2022.
