At their Sept. 8 meeting the St. Croix Electric Cooperative Board of Directors approved an updated SCEC BD POL 501: Capital Credits General Retirement which included the following amendments:
- Requirement to provide a check for capital credit refunds to active members exceeding $100 eliminated.
- Amount threshold for payout for non-active accounts increased from $30 to $50.
Policy 501 “establishes a sustainable program of general capital credit retirements of both Dairyland Power Cooperative (DPC) and St. Croix Electric Cooperative (SCEC) margin allocations.”
Under the old policy, active members with refunds of $100 or more received their refund in the form of a check, unless the member made a one-time election to receive all future refunds as bill credits.
The Board discussed the pros and cons of continuing to issue checks versus making a policy change to issuing only credits and decided it was in the best interest of the cooperative and its members to make the switch. The change (and the increased threshold for non-active accounts from $30 to $50) was based on a variety of reasons:
- Reduced costs for mailing – check itself, envelopes, postage, insert fees, etc.
- Reduced number of checks printed
- Reduced per check bank fees
- Less confusion – our new software has more processes, resulting in some members potentially receiving two checks or one check and one bill credit
- Reduced labor to manually apply uncashed capital credit checks to active member accounts
- Reduced number of checks circulating to reduce fraud exposure
SCEC was the victim of bank fraud on our checking account just last month. Fortunately, our internal bank reconciliation process caught the fraud and our account was credited. Two checks were cashed out East containing our bank account and routing information on phony checks for services never rendered. Once reported, the bank reimbursed SCEC for the check amounts, but this recent fraud on SCEC weighed on the Board’s decision to not mail over 4,000 paper checks to active members and instead credit your electric bill.