What are capital credits?
As a member-owned cooperative, Holmes-Wayne Electric strives to safely provide reliable, competitively priced electric service for our member-owners. We sell and deliver electricity to our members at a cost plus a small margin. It is necessary to maintain an operating margin to provide working capital, which is used to maintain the electric distribution system, to build and upgrade lines and substations, and to help provide service to new members. However, because we are a not-for-profit cooperative, we return these margins to the member in a form called patronage capital credits.
Capital credits are returned to each member based on patronage. Capital credits are assigned, or "allocated,"to each member-owner for the prior year. They are divided among members according to the amount of revenues the Cooperative receives from member. In essence the more power you buy, the higher your share of capital credits.
You also receive an allocation of capital credits from our electricity supplier, Buckeye Power, which is also a cooperative. Holmes-Wayne Electric is a member-owner of Buckeye Power, similar to the way you are a member-owner of HWEC. Buckeye Power allocates capital credits to Holmes-Wayne Electric based on the same principles. We, in turn, allocate these capital credits to you. You are notified annually of your allocation of the capital credits assigned to your account for the prior year.
Your member-elected board of trustees oversees the financial well being of the Cooperative. As the financial status of the Cooperative permits, the board will "retire" a portion of the capital credits. Capital credits are currently being retired on the industry recommended 20-year cycle. When these capital credits are retired they are returned to the current and former members via check. This is one reason why you always should keep your cooperative apprised of your address. If you move off of Holmes-Wayne Electric's lines, you may have money coming to you in the future, so keep in touch!
Money Returned in June 2020
Holmes-Wayne Electric Cooperative's most recent retirement of capital credits was for the years 1999 and 2000. $786,723.03 in capital credits is being returned to the members of Holmes-Wayne Electric. If you are a current member of Holmes-Wayne and were a member during 1999 and 2000 you should have receive a check in June 2020 for the amount of your capital credits for 1999 and 2000.
If you were a member of the Cooperative during 1999 and 2000, have moved off our lines and did not receive a check (the minimum amount returned is $10.00) please contact the Cooperative office toll-free at 866-674-1055.
2019 Allocation on May 2020 bill
You are notified annually of your "Allocation" of capital credits assigned to your account for the prior year. Please note on your May 2020 bill, the information regarding the "2019 Allocation" for Holmes-Wayne Electric Cooperative. You will only have "2019 Allocation" if you were a member of the Cooperative in 2019.
Capital credits are retired to the estates of deceased member on a "present day value" based on the current 30-year U.S. Treasury Note yield, which is similar to the rate at which the Cooperative borrows money. If you are the executor of the estate for a deceased member of the Cooperative, please contact the Cooperative office to arrange for the return of the member's capital credits. If the estate is "open" you will need a copy of the death certificate and a copy of the appointment of executor. If the estate has been closed, you need only the death certificate.
For more information, you can contact us at 866-674-1055.