“Happy New Year!” I hope you had a great Christmas and you were able to spend the holidays with your family and friends. Almost everyone that is currently a consumer of Midwest or was a consumer in 1991, 1992 or 1993 received a check from Midwest Electric a couple of weeks before Christmas to help you with that last minute shopping. Midwest returned patronage to our members by check worth $1,061,387 and credited members December bills who had allocations under $20 an additional $6,434. The Board of Directors approved estate retirements of $182,284. Total retirements paid in 2018 were $1,250,206. This number represents 4.2% of our entire revenue for 2017.
Patronage capital, also called margins, for any given year, is the difference between that year’s operating income and operating expenses. Margins are allocated on an annual basis to the cooperative membership based upon their individual usage during that year. Each member has a patronage capital account, which represent that member’s ownership in the cooperative. Coops operate differently than other businesses in two ways; they are NOT designed to create a profit for a small number of shareholders, as many businesses are. They are owned by those we serve, therefore, allocated margins at some point in time, are returned to the membership.
Midwest currently retires 4% of our allocated margins each year to keep us in a 25 year rotation. We also offer a current layer retirement for our current members whom wish to take part of the cash now (present value) and not wait for 25 years to receive this money. This is why many of you received two checks in the mail.
I also would like to thank all of you for your patience on our storm repairs in 2018. This was a year of many storms in the Spring and several in the Fall that created some dangerous situations for our workers. It’s through your cooperation that we’re able to restore the power quickly and safely. Thank you and may you have a safe and prosperous year!
*Midwest Electric is an equal opportunity provider and employer.*