Everything listed under: Cooperative Principles

  • What are Capital Credits?

    Your Missouri Electric Cooperative’s first job is to provide you with reliable, safe, affordable electricity. As a nonprofit organization, though, we do more for you than just power your home, farm, or business affordably and reliably. When we’re able to do so, we put cash back into your pocket, too.

    Your local Cooperative is owned and governed by you, its Member-Owners, so when there’s margin at the end of the year after bills have been paid and investments have been made, you earn part of that margin. We call your earnings your capital credits.


    Source: National Rural Utilities Cooperative Finance Corporation

    Capital credits are just one way that your nonprofit Missouri Electric Cooperative is different from a traditional for-profit utility company. Keep reading to learn more about what capital credits are and how they’re distributed.

    What are Capital Credits?

    At the end of each year, your Cooperative will determine how much margin is left in its budget after operating expenses have been covered, loans have been paid, and appropriate emergency funds have been set aside.

    “A margin is any money left over after all operating costs have been paid,” explains Central Missouri Electric Cooperative. “As a cooperative member-owner, part of that margin belongs to you. The more electricity you’ve used, the greater your share of the margin (source).”

    It’s up to your Cooperative’s by-laws and board of directors to decide exactly how that margin will be spent, but in general, your capital credits come out of those margins. And the more power you’ve purchased from your Cooperative, the more capital credits you’ll earn. 

    Where Does the Money for Capital Credits Come From? 

    The money for your Cooperative’s capital credits program comes from the money you pay into the Cooperative as part of your monthly electric bill. Every Member-Owner of every Missouri Electric Cooperative earns capital credits, but not every Cooperative — and not every Member-Owner — will receive a check every year.

    When will I receive my capital credit?

    Your Cooperative’s board of directors will decide when to issue capital credit checks and when to hold onto that money for as capital for the Cooperative. Your Cooperative will allocate your credits every year, but it may only issue you a check (or “retire” your capital credits) every few years.

    It’s important to note that many Cooperatives will only retire your capital credits if those credits meet a minimum threshold. That threshold is typically between $5 and $15 per Member-Owner, and it’s designed to prevent your Cooperative from spending more money writing and issuing your check than your capital credits are worth. 

     Can I donate my capital credits back to the cooperative? 

    Most of Missouri’s Cooperative Member-Owners have a household income that’s under $75,000 per year, and according to the Associated Electric 2013 Triennial Survey, 20 percent of our Member-Owners’ annual household incomes are less than $20,000.

     


    Image Credit: Co-Mo Electric Cooperative

      

    Operation Round Up is a charitable program that many of Missouri’s Electric Cooperatives participate in. Through Operation Round Up, you can donate your capital credits back to your Cooperative. Your Cooperative uses your donation to provide financial assistance to community organizations, individuals in crisis, and to fund Cooperative scholarships. If you’re interested in donating your capital credits this year, contact your local Cooperative.  

    Your Missouri Electric Cooperatives: More than Just Electricity 

    Your Missouri Electric Cooperative’s first job is to provide you with safe, affordable, and reliable electricity, but we take our commitment to community even further through programs like capital credits and Operation Round Up.

    As a nonprofit organization, your Cooperative is required by law to use 85% or more of its annual income for the sole purpose of meeting losses and expenses. You can read more about your Cooperative’s nonprofit status on the National Rural Electric Cooperatives Association website, and you can learn more about Missouri’s Electric Cooperatives by following us on Facebook , Twitter, YouTube, and Instagram.

     

  • A cooperative career

    I’ve always believed that electric cooperatives are the best place in the world to work. Now, it would seem, is the best time ever to start a cooperative career.

    That’s because electric cooperatives nationwide are seeing an unprecedented turnover in their workforce. In the next five years, electric cooperatives could be hiring replacements for 14,400 retiring employees.

    That trend holds true in Missouri as well. Of the state’s 4,455 electric cooperative employees, 15 percent will be eligible for retirement by 2021. I don’t think I’ve ever seen so many job openings around the state.

    Recent listings included an electrical engineer for Sac-Osage Electric, a communicator at Boone Electric, a customer service rep at Three Rivers Electric and an IT manager at Farmers’ Electric.

    This comes at a time when the rural workforce is shrinking in many counties. So where will the next generation of cooperative employees be found? That’s a question concerned CEOs have been asking since this issue appeared on the horizon several years ago.

    And cooperative leaders at the Association of Missouri Electric Cooperatives and the National Rural Electric Cooperative Association have been working on some innovative solutions to find the best and brightest employees.

    For example, this year AMEC will launch its LED Academy, which stands for “Leadership, Excellence and personal Development.” This program is designed to create the next generation of leaders for Missouri’s electric cooperatives, preparing them to meet whatever challenges may face their systems in the future.

    Years ago, Missouri’s electric cooperatives worked to help build the lineman training program at the State Technical College of Missouri in Linn, ensuring there were enough of these essential personnel to keep the power flowing.

    Our national association also has identified another excellent source of talent to fill these jobs: veterans. Every year, thousands of highly skilled armed forces veterans transition out of the military in search of civilian jobs. These soldiers, sailors and air men and women are as diverse in their backgrounds as they are in their skills.

    Best of all, 44 percent of those in service to our country come from rural areas and want to come home if they can. Veterans also share many of the same values cooperatives do: love of country, service to others and work ethic.

    With this in mind, NRECA launched its “Serve our Co-ops, Serve our Country” program designed to create a coalition of electric cooperatives with the shared goal of helping military professionals — and their spouses — find jobs in rural communities. Where possible, these cooperatives will try to match transitioning veterans to employment opportunities as they have job openings.

    The program was launched in January, and the first veteran hired through it begins work in June.

    An electric cooperative career matches the desires of many members of the millennial generation, who rank businesses that serve others high on their list of desirable places to work. After all, electric cooperatives exist only to provide a service to members.

    So how does one connect with a cooperative career? The first place to start is online at www.TouchstoneEnergy.com. Here you can learn about the cooperative difference and decide if a cooperative career is right for you. If so, the site offers links to available jobs and tools that let you post a resume and set job alerts.

    A cooperative career is about more than a paycheck. It comes with the benefit of working in the country and the satisfaction of knowing your efforts directly benefit your community.

    - Barry Hart

  • How Are Missouri State Property Taxes Assessed?

    Property taxes provide critical funding for more than 250 local governments in Missouri. They provide revenue for local services like police, fire and rescue, street maintenance, senior citizen programs, schools, hospitals, parks and recreation, and emergency medical services. Today’s post explains how your Missouri Electric Cooperative’s property taxes are assessed.

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    Property Assessment and Local Tax Rate

    Your Cooperative’s property tax is determined based on its property tax assessment and its local government tax rates. Assessment, according to the Missouri State Assessors Association, is, “the process of placing value on a property for the purpose of property taxation.”

    County assessors conduct property tax assessments, but the assessment system falls under the oversight of the Missouri State Tax Commission. Property tax rates are set by your local government — usually by your county, but sometimes by your city.

    How Often are Cooperatives Assessed?

    Assessments occur every odd-numbered year. Once a property has an initial assessment, it is reassessed every odd-numbered year after that. Assessments and reassessments allow your Cooperative to know that they’re paying a fair tax rate, and they also give your Cooperative peace of mind that any changes in the value of the Cooperative’s property are accounted for.

    Nonprofit but not Exempt

    While some nonprofit and governmental organizations like churches and schools are exempt from property taxes, your nonprofit Electric Cooperative is not exempt from paying property taxes. In fact, it falls under its own special set of Missouri Assessor’s Manual guidelines.

    Chapter VII of the Missouri Assessor’s Manual explains exactly how Missouri’s Electric Cooperatives are assessed. The guidelines outlined in the Assessor’s Manual are developed by the State Tax Commission and “are furnished to each county assessor for the valuation of Rural Electric cooperatives (RECs).”

    The Cost Approach

    Each county assessor is responsible for determining your Cooperative’s assessed value. They do this using a method called the cost approach. Using the cost approach, the assessor subtracts your Cooperative’s “obsolescence” from the net value of its production, distribution, transmission, and transformer plant(s).

    In assessment terms, “obsolescence” is a way to account for the lost value of property or equipment that happens over time or that results from outside factors. One example of obsolescence is when a Cooperative’s equipment is outdated. Another is the lost value of a Cooperative’s property when neighboring property development prevents the Cooperative from being able to make necessary expansions.

    Paying Taxes to Support Your Community

    Each year, your Cooperative pays hundreds of thousands of dollars or more in local property taxes that support important social services like health care, education, and emergency management. The next time you pay your Cooperative electricity bill, you can rest easy knowing that your Cooperative invests part of your payment back into your local community by paying annual property taxes.

    Learn more about Missouri’s Electric Cooperatives, and how we work to provide safe, efficient energy to rural Missouri by following us on Facebook, Twitter, YouTube, and Instagram.

  • Cooperative Principle #7: Concern for Community

    Missouri’s Electric Cooperatives operate alongside Electric Cooperatives around the world according to a core set of Principles. These Principles, along with the cooperative purpose of improving quality of life for their members, make Electric Cooperatives different from other electric utilities. 
     

    The seventh Principle of Missouri’s Electric Cooperatives is Concern for Community. According to the National Rural Electric Cooperative Association, Concern for Community means that:  

    “While focusing on member needs, Cooperatives work for the sustainable development of their communities through policies accepted by their members (source).”  


    Barry Hart, the Executive Vice President and Chief Operating Officer of the Association of Missouri Electric Cooperatives says that Concern for Community equates to improving quality of life for Missourians.  

    “We know that when we brought electricity to rural Missouri quality of life improved, but there’s a lot of other issues that need to be addressed. Your Electric Cooperative is at the forefront of all those issues that are being addressed in the community.”  

    Improving quality of live can mean a number of things. It can mean offering programs for Missouri youth, helping to develop local economies through job creation, representing Member-Owner interests in the Missouri General Assembly, or encouraging employees to be active in local organizations like Kiwanis and Rotary.  

    According to Hart, “…any of those organizations or programs [in your community] that are making your community a better place to live, I guarantee you, your Electric Cooperative’s plugged in to what’s going on.”  

    Your Missouri Electric Cooperatives have your local community’s best interest at heart. Learn more about Missouri’s Electric Cooperatives by following Cooperative stories, photos, and videos on our Facebook , Twitter, YouTube, and Instagram accounts. 

    How to Join Your Missouri Electric Cooperative
    If you’d like to become #aMemberOwner of one of Missouri’s Electric Cooperatives, contact the Missouri Electric Cooperative in your community. You can find a list of Missouri’s more than 30 Electric Cooperatives, including links to their websites, here.

    Did you know? 
    Your Missouri Electric Cooperative is a 501(c)(12) nonprofit organization, which means that 85% or more of its annual income must be used for the sole purpose of meeting losses and expenses. You can read more about your Cooperative’s nonprofit status on the National Rural Electric Cooperatives Association website.


  • Cooperative Principle #4: Autonomy & Independence

    Missouri’s Electric Cooperatives operate alongside Electric Cooperatives around the world according to a core set of Principles. These Principles, along with the cooperative purpose of improving quality of life for their members, make Electric Cooperatives different from other electric utilities.

     

    The fourth Principle of Missouri’s Electric Cooperatives is Autonomy and Independence. According to the National Rural Electric Cooperative Association, Autonomy and Independence means that:

    “Cooperatives are autonomous, self-help organizations controlled by their Members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their Members and maintain their Cooperative autonomy.”

    As the Association of Missouri Electric Cooperatives’ Executive Vice President and Chief Operating Officer, Barry Hart, explains, this Principle doesn’t mean that your Cooperative can’t partner with other organizations, companies, or agencies. The fourth Principle simply calls your local Cooperative to remain autonomous.

    “It can work with organizations like companies that supply materials,” says Hart. ”It could be other organizations like agencies; state and federal agencies. But still, your Cooperative is independent, and it’s required to be so by the principles.”

    How to Join Your Missouri Electric Cooperative
    If you’d like to become #aMemberOwner of one of Missouri’s Electric Cooperatives, contact the Missouri Electric Cooperative in your community. You can find a list of Missouri’s more than 30 Electric Cooperatives, including links to their websites, here.

    Did you know? 
    Your Missouri Electric Cooperative is a 501(c)(12) nonprofit organization, which means that 85% or more of its annual income must be used for the sole purpose of meeting losses and expenses. You can read more about your Cooperative’s nonprofit status on the National Rural Electric Cooperatives Association website.

    Learn more about Missouri’s Electric Cooperatives, and how we work to provide safe, efficient energy to rural Missouri by following us on Facebook , Twitter, YouTube, and Instagram.

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