Pedernales Electric Cooperative – Board of Directors Meetings

File #: 2024-134    Version: 1 Name:
Type: Action Item/Other Items Status: Passed
File created: 4/9/2024 In control: Board of Directors
On agenda: 5/17/2024 Final action:
Title: Resolution - Approval of Capital Credits Special Distribution during Calendar Year 2024 - J Smith
Attachments: 1. PPT - 2024 Capital Credits Special Distribution - 2024-134_Final
Related files: 2024-096
Resolution - Approval of Capital Credits Special Distribution during Calendar Year 2024 - J Smith

Other Info
Submitted By: Janelle Smith
Department: Chief Financial Officer
Financial Impact and Cost/Benefit Considerations: Expenditure of Cooperative funds estimated in the approximate amount of $5,000,000. Expenditures of staff time limited to ordinary processing requirements.

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 additional 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 Board may consider a Special Capital Credits Retirements (distribution and payments) to former members under the Policy in an amount not to exceed $5,000,000.

The Retirements (distribution and payment) of capital credits in an aggregate amount not to exceed $5,000,000 would consist of approximately 7% to the oldest outstanding year(s) with discounting and approximately 93% to the most recent year(s) with discounting as Special Capital Credit Retirements. The Retirements would consist of checks to any former members and deceased members' estates who are entitled to at least $10.00 by check in 2024.

The Board previously approved a Capital Credits Distribution for the calendar year 2024 in December 2023 (2023-366) for regular retirements and special retirements for deceased estates.

NOW T...

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