December 2009

Capital Credts

Dear Member:

Every year, your Board of Directors reviews Midstate Electric's financial condition relative to the retirement of past years' capital credits. This year the board is pleased to announce the retirement of the remaining 20% of the 1991 and 100% of the 1992 capital credits. If you were a member in 1991 and 1992, you will probably be receiving a capital credit check in the mail mid-December.

Midstate Electric will retire a total of $857,000 in capital credits. The capital credit checks are refunds of margins (profits). These margins are the difference between what members paid for electric service and what electric service actually cost to provide.

Midstate Electric is a non-profit business and we exist only to provide service to our members. Every year, any margins are allocated back to the members based on each member’s energy billings. These allocated margins are retained by Midstate Electric and used for several years—thus lowering the cost of providing electricity. The alternative would be to borrow more money to run the business, which would raise the cost of providing service.

By authorization of the Board of Directors, capital credits are repaid on a rotation basis; first earned—first to be retired. The amount of the capital credit refund is based on how much electricity was billed during the periods being paid and the financial condition of the Cooperative at the time of the refund. Midstate Electric paid the last capital credit refund in December of 2008.

For many Midstate Electric members, it will be nice to receive a little extra holiday cash this month when we pay capital credit refunds. But it’s more than that; it’s just one more benefit of doing business the cooperative way.

Happy Holidays from Our Family to Yours

We want to thank you for your support and kindness this past year. Because of you, the cooperative spirit that created this business and keeps it going continues into another year.

We are committed to providing clean, safe and reliable power with excellent customer service at affordable electric rates. I believe we have delivered on that goal. We will continue evaluating the way we work to ensure that everything we do, whether in the field building power lines or in the office serving customers, is done as efficiently as possible.

Our office will be closed Christmas Day and New Year’s Day. In case of an outage or electrical emergency, our after-hours outages/emergencies lines (541-536-2165 or 800-752-5935) will be open 24 hours a day to assist you.

Have a safe and happy holiday season!

Bill A. Kopacz
General Manager

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