Nearly 5,000 LCEC equity checks are in the mail.
Last month, the LCEC Board of Trustees approved $6.1 million in retired equity distribution to memberships that have been closed since 2003. In addition, the trustees also approved an $8.2 million general distribution to current and inactive customers which will be distributed next month, said LCEC spokeswoman Karen Ryan.
LCEC is a not-for-profit cooperative utility. When annual excess revenues, or margins, are generated, the Board of Trustees considers an equity distribution. In 2010, LCEC was able to maintain a sufficient financial position and for the third year in a row did not raise base rates, Ryan said.
Although not all cooperatives are able to return equity, LCEC has returned more than $164 million in equity over the years, she said.
LCEC equity represents members’ investment in the LCEC electrical system in the form of substations, poles, wires, transformers and other facilities. Not-for-profit cooperative members invest in the infrastructure needed to provide electric service to customers and help keep rates competitive.
Without member investment, LCEC would need to secure additional funding from interest-bearing loans which would be recovered in the form of higher base rates, Ryan said.
“LCEC is proud of the financial strength that has allowed equity to be returned to customers in 2011,” Ryan said. “It’s one of the benefits of belonging to a financially stable electric cooperative.”
Established in 1940, Lee County Electric Cooperative Inc. is a not-for-profit electric distribution cooperative serving parts of Lehigh Acres, Cape Coral, North Fort Myers, Marco Island, Sanibel and Captiva Islands, Pine Island, Everglades City, Immokalee, and Ave Maria.