Capital Credits

Big Bend Electric Cooperative, Inc. (BBEC) is a non-profit, member-owned corporation. Electric service is provided to BBEC members on a cost basis. The difference between what members paid for electric service and what the service actually cost to provide is what electric cooperatives call "margins". Each year, BBEC allocates any margins back to members based on how much business each member did with BBEC in accordance with BBEC bylaws.

This allocation of margins is referred to as "capital credits" or "patronage capital". BBEC is on a calendar year accounting basis and allocation takes place after the audit of financial statements are complete. Each year, statements are sent to members showing the amount of allocation. Members that have more than one account receive only one statement showing the combined allocation for all accounts held by the member. Capital credits are not necessarily distributed to members immediately following allocation. Margins are used by BBEC to improve electric lines, build new services, and purchase trucks and equipment needed to operate the business. As finances in future years allows, BBEC pays back capital credits to members. It is important for former members with unpaid capital credits keep their address current with BBEC. Heirs of deceased members with unpaid capital credits should contact BBEC to find out how to transfer the unpaid capital credits.

The amount of capital credits to be refunded depends upon prior years' margins and future capital needs. The board of directors decides the amount to be refunded. Capital credits have been refunded to members for 32 consecutive years with payments during those years of $22.5 million. BBEC has refunded all capital credits through 1993.

Cumulative Capital Credits
Returned to Members