What are capital credits?
As part of a cooperative you’re not only a member, you’re an owner. And as an owner you have financial stake in the co-op. When Cherryland has excess revenue – money collected above and beyond what it takes to run the company – it doesn’t go to investors or stockholders, it goes back to our members. This money, known as capital credits, is returned in the form of a billing credit.
In August, the Cherryland Board of Directors reviews the cooperative’s financials and votes to retire a portion of capital credits that were allocated in previous years. Such factors as the impact on members’ electric rates and the overall financial strength of the co-op help determine the amount retired.
The amount returned to each member depends on their electricity usage in previous years and how long they’ve been a member. These returns, shown as ‘Patronage Capital’, can be found on your October bill under ‘Activity Since Last Billing’.
Capital credits that are not returned to members go directly back into the cooperative. Cherryland uses this capital to build and maintain the distribution system that keeps your lights on. The money is used to reduce your co-op’s long-term debt so our costs stay low and your rates stay affordable in the future.
Over time all capital credits will be returned to members through the board-approved retirements. If you move, please update your address with us and we will continue to send your retirements to you. We have several members move and forget about their capital credits. If you think you might be one of them, check to see if you are on our unclaimed capital credits list.
Since 2009, Cherryland has returned over $16 million in capital credits with $2.5 million of that being returned this year.
If you still have questions about the Capital Credit process, please call 231-486-9200.