Capital Credits

EMEPA to return capital credits

East Mississippi Electric Power Association’s Board of Directors is pleased to announce the return of capital credits for the years 1975 and 1987.

Members of EMEPA during those years helped provide the funding to build and maintain the electric system. As a not-for-profit cooperative, all funds not used to pay the wholesale power bill and operating expenses are invested in the facilities, as opposed to borrowing all the money needed for upgrades and growth.

These capital credit returns reflect the members’ portion of the margins made and invested during that time period.

Unlike investor-owned utilities that pay dividends to their stockholders who are often far removed from the service provided, cooperatives return their margins to the members – those who used the service and provided an important investment.

This is just one way we are making a cooperative difference in service to you and our community.

Capital Credits Frequently Asked Questions:

What are capital credits and capital credit retirements?

Because EMEPA is a not-for-profit cooperative, any revenues that exceed expenses each year are referred to as margins. Each year, margins from the prior year are assigned to our members based on the amount they were billed for electricity during that year. When approved by the Board of Directors, some of the capital credits are retired and returned to members and former members who contributed those margins. The remainder is invested in the facilities, as opposed to borrowing all the money needed for upgrades and growth used to serve the members.

How are capital credits calculated?

The amount of capital credits you earn in a given year is based upon the amount of capital you contribute to the co-op through payment of your monthly electric bills. The capital credits are a dollar amount assigned to members based on power billings during a particular year. This means that members who used more electricity over a year will receive more capital credit allocations than members who used less electricity.

What is EMEPA’s history on retiring capital credits?

Our Board of Directors is charged with acting in the best interest of the Association and its member, and in doing so, requires Management to present an annual financial analysis to determine if capital credits could be retired. In recent years, capital credits were considered in 2004, 2005 and again in 2009; however, due to natural disasters and other unforeseen financial challenges, a capital credit return was not in the best interest of the Association or our members during prior years.

Why is EMEPA retiring capital credits for 1975 and 1987?

EMEPA returns capital credits on a 30-year rotation cycle, provided the co-op margins are sufficient to do so. Prior to 1977, record keeping was done by hand and is not as easily accessible. EMEPA is working to return capital credits for years prior to 1977 on a year-by-year basis as the time-consuming task of sorting all of these hand-written records is completed.

What happens to my capital credits when I leave the EMEPA service area?

They remain on the books in your name until they are retired. We encourage you to ensure that EMEPA has your current mailing address.

I received a check for a former member who is no longer at this address. What should I do with the check?

The check should be returned to EMEPA. If you know the former member, please ask them to contact their local EMEPA office with their current address in order to receive their check.

The former member to whom the check was addressed is deceased. I am an heir. Can I cash the check?

Legal heirs should contact his or her local EMEPA office. A valid driver’s license and birth certificate must be presented. EMEPA will provide the heir with an affidavit that must be signed and notarized. If there are multiple heirs, the affidavit must be signed by each heir.

What happens to unclaimed credits?

They remain on the books in the member’s name until claimed.

Will I receive a capital credit return every year?

Possibly, but not necessarily. The Board of Directors must authorize a retirement before capital credits are returned. When considering a retirement, the Board analyzes the financial health of the Association and will not authorize a retirement if it’s not within the best financial interest of the Association and its members.