Title
Resolution - Approval of Capital Credits Distribution and Payments during Calendar Year 2023 - J Smith
Other Info
Submitted By: Janelle Smith
Department: Financial Services
Financial Impact and Cost/Benefit Considerations: Expenditure of Cooperative funds estimated in the approximate amount of $6,200,000. Expenditures of staff time limited to ordinary processing requirements.
Discussion
The Cooperative's Capital Credits Policy outlines the process for both General Capital Credits Retirements and Special Capital Credits Retirements including the payment of capital credits to members, former members and deceased members' estates, and permits the discounting of capital credits.
This is an annual review and discussion of the Capital Credits distribution and payment by the Board of Directors. Pursuant to its Policy, the Cooperative will retire capital credits in a manner that permits the Cooperative to comply with all applicable laws, all restrictions imposed by its debt financing covenants, the Cooperative Articles of Incorporation and Bylaws, is fair to the Cooperative's members and former members, and is reasonable to maintain a healthy financial state.
The Policy also requires the Cooperative to implement its retirement strategy with certain principles considering retirements to deceased estates, special retirements, and distributions and payments to the oldest outstanding year(s) for which allocations have been made and distributions and payments to the most recent year(s) with discounting for which allocations have been made.
The Board may consider General Capital Credits Retirements (distribution and payments) and Special Capital Credits Retirements under the Policy in an amount not to exceed $6,200,000.
The Retirements (distribution and payment) of capital credits in an aggregate amount not to exceed $6,200,000 would consist of approximately 18% to the oldest outstanding year(s) with discounting and approximately 79% to the most recent year(s) w...
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