LCEC retires $12 million in member equity to help its customers
Lee County’s electric cooperative is doing its part to help customers during the COVID-19 outbreak.
LCEC’s board of trustees decided to retire up to $12 million in member equity and return it to past and current customers.
This is done every year by LCEC, but this year it comes at an ideal time when the country is in the midst of a pandemic and the economic strain for Americans is a pressing one.
Equity is the ownership interest of LCEC members’ in the total assets of the electric cooperative. As a not-for-profit electric cooperative, assets are funded by margins and debt. Net margins are allocated to members annually in the form of a credit to their equity account.
“Net margins are not profit and do not benefit anyone other than members — they do not benefit LCEC management, employees, or Trustees in their management and oversight of the cooperative,” said LCEC Chief Executive Officer Denise Vidal in a release. “When possible, a portion of equity can be converted to cash, retired, and returned to members.”
According to LCEC, this retirement will provide some relief for customers who are unable to pay their electric bill. In April and May, inactive customers will receive a check for their portion of the equity return and active customers will receive a credit on their May bill, or a check if the amount is more than $250. The amounts will vary based on the members’ contribution to revenues.
Those who are up to date on payments will also benefit, as they will get a credit on their bill, based on equity amount, for the next month, helping reduce that price.
For inactive members who still have a debt, this retirement could cover their existing balance.
“For those who may have left with a bad debt, if they had equity in their account, their equity retirement could cover that debt for them,” said Karen Ryan, spokesperson for LCEC.
As a not-for-profit cooperative, LCEC relies on revenue to maintain the grid, purchase power, repay lenders, pay taxes and hire skilled workers. According to LCEC, revenue is earned strictly by billing and collecting for the electricity already used by customers.
“When somebody doesn’t pay a bill, it hurts all customers,” Ryan said.
LCEC is also encouraging customers who are having difficulty making payments to call for assistance. If already past due, customers are able to request an extension through the LCEC SmartHub app or online.
“I would tell customers, if there is a way to pay any portion of their bill, if they can find it in their means, to do it now,” Ryan said. “Because the bill doesn’t go away. We’re going to work with our customers as much as we can and set up payment plans for them, waiving late fees.”
LCEC also contributes funds to a short-term energy assistance fund, the LCEC Power to Share program, in partnership with the United Way. Employees and customers help fund the program that provides bill payment for customers experiencing hardship. Donations to the fund can be made at www.unitedwaylee.org/donate/.
For more information, visit www.LCEC.net or call 800-599-2356.
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