North Arkansas Electric Cooperative has announced it has returned $5,739,127 in capital credits to members in December.
According to a release from the cooperative, this has been the largest retirement in co-op history and marked the 36th consecutive year NAEC has refunded margins. NAEC states it has returned more than $49.5 million since the co-op’s founding in 1939.
NAEC explains it operates as a not-for-profit cooperative and is owned by the members it serves. At the end of each year, the cooperative subtracts, on a taxable basis, operating expenses from the amount of money earned through rates. The remaining balance is called taxable margins.
Taxable margins left over at the end of the year are allocated, or assigned, to each member’s account based on the amount of electricity for which each was billed.
Each member receives a capital credit certificate annually detailing how much of the previous year’s margins was allocated to his or her account. The capital is then retained by NAEC to use as operating capital for a period of time. This decreases the need to raise rates or borrow money to build, maintain and expand a reliable electric distribution system.
Every fall, the NAEC Board of Directors evaluates the overall financial condition of the co-op and decides the amount of capital, if any, to refund.
The retirement represented the remaining approximately 36% of the margins assigned for 1998, 100% of the margins assigned for 1999 and approximately 7% of the margins assigned for 2022. Only members who were billed for electricity during the years above received a refund in 2023.
Refunds were distributed after Dec. 1. Members with a refund of less than $50 received a credit on their December statement. Members with a refund of $50 or more received a check through the mail.
Non-active members with a refund of more than $2 received a check in the mail as well. That is why it’s important to maintain a current mailing address on file with NAEC if you ever move off of co-op lines.
Call (870) 895-3221 or email info@naeci.com with any questions about capital credits allocated to personal accounts.
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Read More: NAEC returns record $5.7M in capital credits