As a member of the Cooperative, you own part of your electric company. The Cooperative operates as a non-profit entity, yet we must still maintain a revenue margin to assure financial stability. The National Rural Utilities Cooperative Finance Corporation (CFC), which loans us money for construction and system improvements, requires us to maintain a set level of margin to cover our interest expense on long-term debts.
A portion of this margin represents the members' or former members' equity in Boone Electric Cooperative. IRS regulations and our bylaws require us to notify each member of their portion of this profit or margin, called capital credits, each year. These capital credits are paid back to members when the Cooperative is in the financial position to do so. The amount of capital credits each member receives is based on the amount of kilowatt hours used during the previous year.
Boone Electric mails capital credit allocation notices each spring. This is to help our commercial members who must consider their capital credits when filing tax returns. Capital credits are typically refunded to our members each year in December.
When capital credits are retired, a portion is paid on a first-in, first-out basis. The other portion goes to current members who received service the previous year. Since capital credits are paid out over many years, it is important that we have a correct address on file for all current and past members. Please notify us if you move out of our service area. Call Membership Records at 573-449-4181 if you have questions about capital credits or to notify us of a new address.