Unclaimed Capital Credits

Why Is The Unclaimed Capital Credits List So Long?

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If you’ve been a member with us for some time, you may have noticed that the list of unclaimed capital credits published in Rural Missouri each October looks a little longer this year. And if you’re newer to the cooperative, this is a great time for a quick refresher on what capital credits are before we explain why the 2025 list has grown.

 

At Co-Mo Connect, capital credit retirements refer to how we distribute or retire the capital credits to our member-owners. Electric cooperatives are not-for-profit organizations that provide electricity to their members at cost. Unlike for-profit utilities, electric cooperatives are owned and controlled by the members they serve. When members purchase electricity from the cooperative, they become members and, in a sense, investors in the cooperative.

 

When Co-Mo generates margins or profits from electric operations exceeding operating expenses, those profits are allocated to our members in the form of capital credits.

 

Co-Mo Connect uses member equity to repay long-term debt and maintain a reserve for financing plant replacements, storm damage, and other contingencies. The use of these funds allows the cooperative to reduce expenses and helps maintain lower electric rates for members.

 

Each year, once Co-Mo completes all necessary financial matters of the organization, the cooperative determines how much of the margin is allocated to each member based on the member’s electricity usage during that year. The cooperative keeps records of these allocated capital credits for each member, which essentially showcase the member’s ownership stake or equity in the cooperative.

 

When the co-op’s financial condition permits, Co-Mo’s board of directors makes the decision to retire, or pay, capital credits. When capital credits are retired, a refund is issued to members, and their equity in the cooperative is reduced.

 

When capital credits are retired, there are some members who have moved away without leaving a forwarding address, passed away and their heirs hadn’t notified the cooperative, or their contact information may simply be outdated. When this happens, their capital credits become “unclaimed capital credits.” 

 

This year, the unclaimed capital credit list is longer due to a change the Board of Directors made in 2023 in how capital credits are retired. 

 

As the cooperative has paid allocations back to the members, there are smaller amounts of funds remaining in allocations for years further back than 15-20 years. This updated process allows the cooperative to pay out those older capital credits at 100% retirement.  

 

Here is how capital credits were retired to members at the end of 2023, which is where this list comes from:

• 100% of unretired capital credits allocated from 1983-1995 were retired.

• 50% of unretired capital credits allocated in 1996 were retired.

• 20% of unretired capital credits allocated from 2021-2022 were retired.

 

As a result of this change, the list has grown longer this year due to the number of members for whom we lack updated contact information. This highlights the importance of ensuring your contact details are current with us. 

 

If you have any questions about how capital credits work or unclaimed capital credits, please give us a call at 800-781-0157. ​​