Central Electric Cooperative, Inc. is a member owned company. As such, it is non-profit, meaning the cooperative’s main goal is to provide reliable energy and service at a good value, not to make money. Anyone who uses, receives or purchases electric energy is a member.
Recent Retirement: Central Electric Returns $1.1 Million to Members in 2018
What are Capital Credits?
As a nonprofit cooperative, after Central Electric deducts costs and upkeep for yearly operations, the net profit is reinvested into the company to provide cash flow, collateral to show stability and to obtain loans. Any net profit over those costs is allocated back to our members in the form of capital credits.
Every member of Central Electric has shares in capital credits. The more electricity you buy and the longer you use the service, the more monetary equity (allocations) you accumulate. Allocations are the total sum of annual equity accrued by the member during their prior year of service.
Each spring, members receive notification of capital credits acquired the previous year. In a fall meeting, the Board of Directors determines if a percentage of capital credits will be paid out, and if so, what amount it will be. The board makes the decision based on the financial condition of the cooperative. If Central Electric incurred additional costs for repairs due to storms, putting in underground cable, upgrading equipment etc., the board may decide to forgo retiring capital credits that year. When the decision is made to do a refund, active members will receive a credit on their December bill. Inactive members will receive a check.
Am I eligible to receive capital credit refunds?
As either a current member or a former member of Central Electric Cooperative, you are entitled to receive a dividend. Refunds will be issued to the member whose name the account is in.
Why aren’t the allocations paid out all at one time?
Central Electric needs to maintain adequate cash flow and collateral to show stability to obtain loans. If the business showed no margin/profit, Central Electric would be unstable and unable to build, improve or maintain its electric system.
Is there any reason that I would not receive a capital credit refund?
The only time a member would not receive the capital credits allocated to them would be if they had a bad debt at Central Electric, including any reasonable interest and late fees resulting from that debt. In this case, Central Electric would deduct what is owed to the coop and the rest of the capital credits, if any, would be refunded at the current refund schedule.
What do I need to do if I move to keep receiving capital credit refunds?
To receive your capital credit check once you leave our service, it is important to keep us informed of your current address. Many checks go unclaimed each year because we are unable to locate previous members.
What do I need to do to see if I have any unclaimed capital credit checks?
Every year in Central Electric’s newsletter, there is a list of all unclaimed capital credits checks. If you think that you may have any unclaimed capital credits checks, please call our office at 800.477.2892 or contact us. Please include your name, current address and phone number in your correspondence.
What happens if a member passes away?
If a member passes away, his/her spouse or representative may do one of two things:
1) They may have the capital credits put into an estate account which will continue to refund capital credits at the same rate as before the member's death, or
2) Central Electric will provide forms to be filled out for an early retirement. However, with an early refund, which can only be done in the event of death of a member, the full amount will not be received. Capital credit allocations come from three levels: Central Electric, East River Electric, and Basin Electric. If an early retirement is selected, only the Central Electric portion would be paid. East River and Basin allocations would be forfeited.
In the case of a joint partnership, if one partner passes away, the capital credits revert to the surviving partner. If a partnership is dissolved and Central Electric is not instructed otherwise, one-half of the capital credits previously allocated to the joint membership, are re-allocated and re-credited to each joint member.
What do I need to settle the capital credits estate on behalf of a deceased person?
If you are the surviving spouse, you will need to complete and sign a form as provided by Central Electric as well as obtain two witness signatures.
If you are NOT the surviving spouse, we require ONE of the following:
1. In the case of a Probate: certified copies of the Letters of Personal Representative
2. If the value of the estate is less than required to Probate: an Affidavit of Small Estate
3. If the member was a trust: a Certificate of Trust
4. A form from the Tribal Court: Appointment fo Special Representative
A copy of a will is not sufficient. Additionally, any paperwork designating that person as the power of attorney will not work, as a power of attorney becomes null after death.
Do I have to report the allocations or capital credit refunds as income?
The best advice we can give you is to contact your tax preparer. He or she is the expert.