The Flint Energies’ Board of Directors has authorized the distribution of retired capital credits for the years 1988-89 in the amount of $3.423 million.

“For those who were members in 1988-89 and still members of the cooperative, credits will appear on their monthly bills in September,” said Sr. Vice President Jimmy Autry. “Those who are no longer members of Flint will receive their checks just after Sept. 15. If the check would be written for less than $5, the credit will carry over to the next refund.”

Since financial conditions supported the resumption of capital credit retirements in 2009, Flint has refunded or retired $19.11 million to members. ($1.996 million in 2009, $2.128 million in 2010, $2.373 million in 2011, $2.347 million in 2012, $2.150 million in 2013, $3.379 million in 2014, and $3.536 million in 2015).

“As directed by the Board in prior years, a long-term capital credit retirement plan has focused on maintaining – & ideally, reducing – the current 27-year retirement cycle,” said Autry. “This capital credits refund tradition continues our effort to share in the benefits of membership in a not-for-profit cooperative,” Autry added.

“Flint Energies has refunded all retained capital credits from our beginning in 1937 through 1988,” Autry said. “That’s more than $42 million which has been refunded to our members.”

Flint Energies uses the “first-in, first-out” method of retiring capital credits, refunding to members whose capital has been invested for the longest time in the cooperative. There will be 14,600 credits on the September bills and 12,900 checks delivered to former members. Roughly 21 percent of the current membership will see capital credit refunds in September.
 
What are capital credits and how are they paid?

Member-owned, not-for-profit electric utilities like Flint set rates to bring in enough money to pay operating costs, make payments on any loans and provide an emergency reserve. At the end of each calendar year, the cooperative subtracts operating expenses from the total amount of money collected during the year and this balance is the called “margin.” This margin is allocated back to each member that year in proportion to their purchases, according to Autry.

“Then on an annual basis, the Flint Energies Board of Directors makes an independent decision on the financial condition of the cooperative,” Autry said. “When the cooperative is strong enough financially and the member equity level is high enough, the Board directs the staff to refund some portion of past year’s capital credits.”
Prior to refunding capital credits, Flint uses member equity in place of commercial loans to help construct the Cooperative's physical plant (poles, wires, transformers, etc.).

Capital credits are somewhat similar to the dividends paid to shareholders of investor-owned utilities except the cooperative’s “shareholders” are also the members that it serves and the “dividends” (capital credits) are distributed Flint’s member-owners.

“The process of member capital credits fulfills the third cooperative principle of ‘Member Economic Participation’,” said Autry. “That principle states: Members allocate surpluses for any or all of the following purposes: developing the cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.”
Persons who have deceased spouses, parents or grandparents served by Flint Energies in 1988-89 may be eligible to claim “Deceased Member Capital Credits” by contacting any Flint office.
 
Capital Credits Tips from Flint Energies

(1) Capital credits are reserved for each member even if they move out of the Flint service area. Flint will make a diligent effort to send a check by mail. Members are asked to keep Flint informed of forwarding addresses.

(2) If a check is not cashed or is returned by mail, Flint will publish names and attempt to find member addresses. To claim a check, members must provide proper identification. Check here for claims: https://www.flintenergies.com/unclaimed-capital-credits. If you know of someone who might be due a refund, please have them contact Flint to update their contact information.

(3) Keep Flint Energies informed of address changes, as members may receive checks over several years.

(4) When members call for a new electric service, they are asked if they have been a member before to help keep capital credit distribution records current.