What are Capital Credits?
Nishnabotna Valley REC is a non-profit organization. Unlike a for-profit business or organization where profits are paid to shareholders, as a Cooperative, any profit or margins related to the sale of electric service remaining after all expenses have been paid are returned to the members in proportion to their electrical usage. These are called capital credits or patronage dividends.
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Nishnabotna Valley REC patronage dividends are returned to members on a 20-year roll. Each year after reviewing the financial health of the cooperative, the board of directors may declare a retirement. At this time all or part of each member's allocated amount can be paid.
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Iowa law also allows a percentage of the current year’s dividends to be returned.
How are Capital Credits returned to you, the member?
An allocation determines each member's share of the cooperative's margin for a given year. Margins are "allocated" or assigned to members who purchased electricity from the cooperative during the year in which the margin was generated. This allocation is based on the proportion of electrical sales for that year. Each member's portion is recorded in a capital credit account where it remains until it is "retired" (paid).
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For 2024, the board of trustees approved retirement of $1,562,784.82 in Capital Credits. This money will be paid out 20-years from the date of retirement. Patronage dividend notices are mailed to members each May to indicate how much money was allocated to them for the previous calendar year. If you were a member during 2024, and you did not receive a letter or a notice on your June usage billing statement, please contact the Nishnabotna Valley REC office at 712-755-2166.
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What does Nishnabotna Valley REC do with Capital Credits not yet retired?
Capital credits are a significant source of equity for most electric cooperatives. Equity is used to help meet the operating expenses of the co-op, such as paying for new equipment to serve members and repaying debt.
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What does Nishnabotna Valley REC do with unclaimed Capital Credits?
Sometimes, Nishnabotna Valley REC does not have a current address for a member and therefore does not mail a check or gets a check returned to the cooperative’s office. Other times, a check will be mailed, but never is cashed by the recipient. This money is considered "unclaimed". Nishnabotna Valley REC will publish the names associated to unclaimed capital credits in our newsletter.
Members on that list complete an address verification process and a check will be written.
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Can I receive my Capital Credits early if I move away?
If you move from the Nishnabotna Valley REC area, the capital credits accumulated in your name will remain in your name. It will not affect when capital credits are paid. Whenever capital credits are paid for a given year, they are paid to everyone who paid an electric bill that year regardless of whether they remained a member or moved.
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What happens to my family member's Capital Credits if they have passed away?
If you are the rightful heir, you can complete a form and provide the appropriate documentation to transfer the capital credits into your name. Please contact the Nishnabotna Valley REC office for further information at 712-755-2166.