MAY 2013
Capital credits refunds coming in May! Money is coming back to members this May thanks to a capital credits retirement approved by your board of directors! The $4.2 million capital credits retirement represents the largest retirement in a single year in the cooperative’s history. Members will typically see a refund of about double the amount they received last year. Those qualifying for a $35 refund or more will receive a check in the mail, while those qualifying for less will see it as a credit on their electric bill received in May. As a cooperative business, Blue Ridge Electric doesn’t earn profits. Instead, any revenues remaining after all expenses have been paid each year are considered “margins” that are returned to the members after being used for a period of years as capital to help finance major long-term reliability projects. This helps offset the need to borrow funds, thereby helping keep your electricity rates lower. It also helps maintain a healthy balance between debt and equity to ensure your cooperative’s financial health and stability. Your capital credits refund is based on the amount of electricity you purchase. The more electric service you buy, the greater your capital credits account — although the percentage will remain the same. Before they’re retired, capital credits are recorded as allocations on the permanent financial records of the cooperative and reflect your equity or ownership in the cooperative. Each year, your board evaluates the return of a percentage of capital credits to members based on the cooperative’s financial condition. Over the history of Blue Ridge Electric, more than $40 million has been returned to members.
Members qualifying for a capital credits refund of $35 or more will receive a check delivered separately from their electric bill. Those qualifying for a refund of less than $35 will receive a credit on their electric bill that they receive in May. BlueRidge-0513.indd 21
Look for your capital credits check or bill credit this May. We’re pleased to be sending these funds and providing value to those who use our services: the members of Blue Ridge Electric!
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It pays to be a member
Wouldn’t it be nice to get a refund close to a month’s worth of electricity? That’s the value of what many long-term Blue Ridge Electric members are receiving this May when they open their capital credits check. Many others are seeing their refund come as a credit on their bill (full details about the capital credits refunds are on page 21 of this newsletter). Your board of directors approved returning $4.2 million in capital credits to members ― the largest retirement to date in our history. As a result, most members are receiving twice the amount of money as they received from last year’s capital credits refund.
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n fficer Doug Johnso
The benefit of capital credits
Capital credits is an unusual term, but it’s a simple concept. Until capital credits are returned to the members, they are used as operating capital to invest in power lines, transformers, substations, and other assets that provide you with reliable electric service. Capital credits are the accumulation of annual margins — the revenues minus expenses of the cooperative — allocated to each member based on your usage and purchase of electricity. After using the money for a period of years to finance investment in electric facilities, it is returned to members over time.
A key business principle of cooperatives is providing “at cost” service to consumers, which means cooperatives don’t exist to earn a profit. In a cooperative, there is no stock to be purchased or sold; the members are the owners of the business. After being used for a period of years to finance electric facilities investment, a percentage of capital credits are returned annually to members of a cooperative.
To assure your return of capital credits and the fiscal health of your cooperative, your board of directors has approved an equity management plan. The plan sets a goal for member equity at 40 percent of assets, and it includes a schedule for the regular return of member equity in the form of capital credits. Our members currently have just over 41 percent equity invested in the cooperative, which is $139.8 million out of $337.4 million in total assets. This year’s return of capital is three percent of member equity.
What happens to my capital credits if I move or am no longer a member? Your capital credits remain on our records in your name and member number until they are retired. To ensure you receive your capital credits refunds, you should always alert Blue Ridge Electric of any address changes.
The equity plan also determines how much of the cooperative’s investment in electric system assets will be covered through member capital and how much will be covered by loans ― the two sources of funds for a cooperative. Our goal is to balance member capital (equity) and debt in order to give members the lowest possible rates over the long term. Since our founding, and including this refund, Blue Ridge Electric has returned $40.8 million in capital credits retirement funds to our members. We’re pleased to be sending money back to you this May. It pays to be a member of a cooperative and capital credits are helping us provide good value to our members!
What happens to the capital credits of a member who dies? The executor of a deceased member’s estate should contact the cooperative to request the capital credits. There are two choices: remain in the normal capital credits retirement schedule and receive a percentage each year or they may be paid immediately at net present value. The executor must submit a Certification of Entitlement form and a copy of the death certificate.
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Votin or by coopera helps u memb you t v
More News Look for director election kit mid-May!
Director elections include Internet and mail options One advantage of being served by a cooperative is the right to elect peers (fellow co-op members) to serve on the board of directors that guide your cooperative. Over the past two years, a record number of members voted using new, convenient options to vote online or by mail.
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While members may still attend and vote for directors during the annual meeting, the new options to vote online or by mail provide the opportunity for more members to be involved in their cooperative.
Voting via the Internet or by mail saves your cooperative money, which helps us control costs for members. We encourage you to try one of these voting options!
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With a service area stretching from the foothills into the mountains and across seven counties combined with busy family schedules, voting online or by mail gives members who can’t attend the annual meeting a more convenient way to vote for their board of directors. Look for your director election kit to arrive in mid-May. Biographical information for all candidates and a proxy for members to make selections will be included, as well as infor-
mation about voting options. In order to be valid when voting by mail, the form must be signed by the member with selections clearly marked and the form returned in the enclosed postage-paid envelope by the date specified in the packet. The form must be mailed; it cannot be given to an employee or accepted at any Blue Ridge office in order to comply with proper election management procedures. To ensure the integrity of director elections, a thirdparty election management firm was approved by the 2013 Credentials and Election Committee (committee names available on our website). Made up of members from across the cooperative’s service area, this committee is responsible for ensuring elections are properly conducted and for certifying results. Look for more information on the cover wrap of this issue and in your director election kit coming midMay and on our website at BlueRidgeEMC.com.
An Appalachian Summer Festival
Outdoor Fireworks Concert featuring The Band Perry Saturday, July 6 at 7:30 p.m. Kidd Brewer Stadium, Appalachian State University Gates open at 6:30 p.m. Adult tickets with Blue Ridge Electric member discount - $32 (regularly $37) Children’s tickets - $5 *All tickets must be purchased through ASU
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Members Only NEWS
~For Members of Blue Ridge Electric
Make it easy with Bank Draft! CORPORATE OFFICE PO Box 112 • Lenoir, NC 28645
CHIEF EXECUTIVE OFFICER Doug Johnson EDITOR Renée R. Whitener PRODUCTION SUPERVISOR Susan Simmons DISTRICT OFFICES Caldwell (828) 754-9071 Watauga (828) 264-8894 Ashe (336) 246-7138 Alleghany (336) 372-4646 Wilkes (800) 451-5474 (800) 448-2383 PowerLine® (PowerLine® is an automated account information and outage reporting system.) Toll Free (800) 451-5474 (for members outside the service area) To report an outage at any time, call one of the numbers listed above. OFFICE HOURS 8:30 am - 5:00 pm, Monday - Friday Night deposit available. Visit us on the Web: BlueRidgeEMC.com
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One of the most popular bill payment choices available to members is Bank Draft. This program gives you the peace of mind in knowing your bill is paid on time without the hassle of stamps, writing a check or worrying about the due date. Our Bank Draft program is fully secure to protect your banking and personal information. Your monthly bill notifies you of your date for the account to be drafted from your bank account. Bank Draft is the most economical payment choice and helps your cooperative control costs, which ultimately benefits members. To further reduce paper and postage costs, members are also encouraged to receive and view their electric bill by e-mail by signing up for “Paperless Billing” on the cooperative’s website. Visit BlueRidgeEMC.com and click on “My Account” to get started!
Benefits of your Co-op Connections Card The Co-op Connections® Card program continues to expand member benefits to help Blue Ridge Electric members save even more money on items and services they use every day. It’s simple! Go to BlueRidgeEMC.com and click on the blue “Residential” tab. Look for “Member Benefits” to the right of the page where you’ll see a link for the “Co-op Connections Card.” Click on Coupons.com or My VIP Savings and browse through thousands of great offers. You can also join the more than 72,000 members who have used their Co-op Connections Card and saved over $1.28 million on their prescription costs. Start saving money today with your Co-op Connections Card.
Membership Matters at Blue Ridge Electric!
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