Capital credits are necessary in order to fulfill the third Cooperative Principle, Members' Economic Participation, in which each member contributes to the capital of the cooperative and allocates surpluses democratically.
As a cooperative, BEC is operated partially on cash received from members’ monthly payments and on the retention of capital credits. Operating on a portion of our net margins (distributed as capital credits), allows BEC to continue operations without the need to increase revenue, either by increasing our debt or increasing our rates. Both options would be more expensive for our member-owners than the present system. Effective management and balancing of these funds have made Bandera Electric a successful cooperative.
You don’t have to do anything with BEC to begin accumulating capital credits; your membership with us automatically activates your capital credits account.
Inactive members have the option to request early retirement of your outstanding capital credits, at a discount. If you would like to request early retirement, please contact our offices at 866-226-3372. Otherwise, your capital credits remain in your name and account number until they are retired. It is important that you ensure that BEC has your current mailing address on file, even after you leave, so we can mail you your check when your capital credits are retired.
Capital credits are simply a record of your ownership in the co-op. Since they are reinvested in the cooperative to support operations, the balance cannot be given to you until the board of directors’ call for their retirement, or you become an inactive member. As an inactive member, you can request early retirement of any outstanding capital credits, at a discount.
When capital credits are retired and remain unclaimed for 3 years, they are escheated to the state of Texas. The state can then decide to allocate some of these funds back to BEC. When this occurs, these funds are used to pay for energy-efficiency programs, invested in economic development programs, and used to fund scholarships. All of these benefit our members and the communities that we serve.
