Title
Resolution - Proposal for Approval of Allocation of 2025 Net Margins to Capital Credits - J Smith
Other Info
Submitted By: Janelle Smith
Department: Chief Financial Officer
Financial Impact and Cost/Benefit Considerations: None.
Discussion
Under Pedernales Electric Cooperative Inc.’s (PEC or Cooperative) governing documents and the Capital Credits Policy, each Member purchasing electricity from the Cooperative will receive an allocation of the net margins as adjusted for non-operating margins and changes in accrued (unbilled) revenue, made by the Cooperative during the fiscal year. The PEC Board is responsible for approving the allocation of capital credits to members.
The net margins shown in the Cooperative's Audited Financial Statements for the year ended December 31, 2025, are in the amount of $80,481,064 (Gross Margin) adjusted for an unbilled revenue amount of ($8,085,304) and adjusted for non-realized non-operating margins not related to providing electric services of $75,361. The amount of $72,471,121 proposed to be allocated first to revenue class based on contribution to Gross Margin and then second based on total gross electric billings for the calendar year 2025 to those members having positive billing amounts during the year within each class. The allocation factors calculated for 2025 are Residential 0.0793420068, Small Power 0.0717531261, Large Power 0.0493592207, Industrial 0.0043987478, and Transmission Level Service 0.0072594423.
Body
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE that proposed allocation of 2025 PEC Capital Credits to its members is approved; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE that the Chief Executive Officer or designee is authorized to take such actions as needed to implement this resolution.