Capital Credits

Need to submit an address change or have a specific question? Visit the Capital Credits Requests page.

What are Capital Credits?

To answer this question, we first need to discuss what a rural electric cooperative is. President Franklin D. Roosevelt signed Executive Order 7037, creating the Rural Electric Administration, on May 11, 1935. One of the foremost duties of the order was "to initiate, formulate, administer and supervise a program of approved projects with respect to the generation, transmission, and distribution of electric energy in rural areas." In spite of the enormity and the complexity of it all, the coop idea, in partnership with REA, became the dynamic force which carried rural America out of darkness.

Rural electric cooperatives are member owned, not-for-profit businesses. The primary source of the annual operating capital for cooperatives comes from the members of the cooperative by way of monthly charges, your "light bill". Any leftover operating capital received from members is allocated back to the members that contributed to the coop that year. This is what is meant by a capital credit. Each allocation depends on the amount that each member paid for utility services that year. The capital credits are returned to you through a refund payment. Talquin's refund of capital credits to its members over the years now exceeds 48 million dollars, with over 3 million dollars refunded this past year.

The amount of patronage to be refunded each year is determined by Talquin's Board of Trustees. Talquin's nine Trustees are elected from our membership and by our membership. Their election takes place at our Annual Meeting, which is held in September of each year. We use the "first- in/first-out" method to refund capital credits to our membership. Currently, as of December 2006, we have refunded capital credits allocated through the year 1990. This is a typical lag schedule used by co-ops throughout the country. The reason for the lag is that it took many years initially for Talquin and the other co-ops to acquire enough reserve to refund members their capital credits without having an adverse effect on future years' operations. Additionally, it is not good business practice to pay back large capital credits quickly and then borrow money from a lender to replenish working capital. The costs associated with doing this would be passed on to you, the members, in the form of higher utility rates. It is better to return capital credits methodically and over time. This ensures that all members will enjoy lower utility rates and have the opportunity to receive their appropriate refund amounts when eligible.

Capital credits will be paid upon the death of a member or former member, to the estate or heirs, in compliance with the Florida Inheritance Law. Upon notification of a family member's death, Talquin will provide the proper forms to initiate the capital credit refund process. A surviving spouse may request that the name of the account be transferred into their name, thus ensuring uninterrupted continuation of utility service.

All former and current members of Talquin have capital credits which have been or will be allocated to them. When a member discontinues service, they remain eligible for a future refund. Our biggest challenge in this huge process is maintaining your current address. It is crucial that you notify us of any address changes. Your cooperation in keeping us informed of your most recent address, whether you are a present or past member, will ensure that you receive the credits you have earned.