Line Extension Credits
While it is the practice of most utilities to charge the customer upfront for the build-out of infrastructure, cooperatives like Columbia REA have a different philosophy. We apply an upfront credit which varies by rate class to the total cost of construction, In addition, if all the costs of service installation are not covered by the line credit, Columbia REA provides the customer the option to finance any balance less the credit and amortize it up to a 10- year time period.
In many cases, this credit allows development to actually take place. With the rising cost of construction, this policy facilitates the project to move forward. The idea is to aggregate the benefit of expansion for the membership while minimizing risk for the individual member.
Each month when you pay your electric bill, Columbia REA uses that revenue to pay the operating expenses for providing electrical service. All excess revenues provide operating capital for the Cooperative and equity for you, the member. Your equity is called patron’s equity, or patronage capital. We retain this equity to retire debt, fund system improvements and for operating capital. As this equity accumulates we retain the amount needed and then distribute the balance to members of the Cooperative.
In April of each year all Columbia REA members receive an "allocation statement" in the mail that shows their "Patron’s Capital" for the previous year. The Patronage Capital statement you receive in the spring is a record of the amount allocated to your account for the subject year. Save this statement for your records. This is the amount that you will receive when that equity is refunded in the future. If you have questions or would like more information about patron’s equity please contact us at: firstname.lastname@example.org.
Annually our Board of Directors review the prospective years and equity percentage eligible for distribution back to members. In December of each year we distribute excess patronage capital collected. Individuals or businesses who were members in that year or individuals assigned by the member according to the bylaws of Columbia REA receive a check or credit to their account.