Capital credits 101
Cass County Electric Cooperative is a member-owned, not-for-profit organization, meaning we operate at cost for the benefit of our members. At the beginning of every year, any excess revenues, or margins, from the previous year are allocated to our members and later paid out in the form of capital credits. This means you, as a member/owner, benefit from any margins produced by the cooperative.
Any excess revenue (margins) remaining and approved of by the board of directors at the end of the year are allocated or assigned to your account as capital credits at the beginning of the following year based on the amount of energy you purchased during the previous year (patronage). Your account will accumulate capital credits each year you are an active member with us.
When are capital credits paid out?
Every year, after reviewing the financial position of the cooperative, the Board of Directors may approve a retirement or payment of capital credits. If approved, the general retirement is processed around the beginning of the year. Active members will receive a credit on their bill. Whereas inactive members will be issued a check if a current address is on file with the cooperative, and the amount of the retirement is greater than five dollars ($5.00).
Capital credits are retired using the FIFO (first-in, first-out) method which means allocations for the oldest years are paid out first. We are currently on a 22-year payout schedule.
Capital credits may be early retired if an active member leaves our service territory with an allocation value of $1,000 or less on their account. The capital credits will be paid out at present value, and a credit will be applied to the final bill with any excess mailed to the address on file.
Family members (heirs) of a deceased member may be eligible to obtain a payout at the present value of the amount of capital credits on the deceased member’s account. Please contact our office for further information.
Tax information
Generally, the receipt of capital credits is tax free if the property served by Cass County Electric Cooperative was used strictly as a residence and not for business purposes. If the residence was used for business purposes and the payments for the electric bill served as a tax deduction, members should consult with their tax advisor about potential tax liability.
Things to remember
Capital credits remain with the primary account holder. They will only be transferred or split between parties as listed in the divorce decree.
Please notify Cass County Electric Cooperative of your forwarding address to ensure you will receive any future checks mailed to you for any eligible capital credit retirements.
For inactive electric accounts, please contact our office in order that we may mail you an application for retirement of the deceased’s capital credits. The application will need to be completed and returned with a copy of the death certificate and other legal documentation depending on the status of the estate.
For active electric accounts, please contact our office for the account to be closed and/or transferred into another person/entity’s name. We will provide you with an application for retirement of the deceased member’s capital credits. The application will need to be completed and returned with a copy of the death certificate and other legal documentation depending on the status of the estate.
A list of individuals whose capital credit checks were returned or uncashed after the most recent payout was published in the October Highline Notes.
Use the unclaimed capital credit search below to see if you have patronage waiting for you. If your name is on the list, call Cass County Electric at 701-356-4400 to claim your credits.