As a non-profit organization, East-Central Iowa REC provides electric service to our member-consumers at cost. When our revenue exceeds costs, as mandated by law, some margins are allocated to certain reserves and to our member-consumers as patronage. This patronage is paid back to member-consumers in cash when the financial condition of the Cooperative allows.
Patronage dividends represent your ownership in East-Central Iowa REC. At the end of each year, your Cooperative totals revenues and subtracts expenses. The remainder (called margins) is allocated to one of three funds:
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A contingency fund that is used to offset unforeseen losses such as repairing lines damaged in a major storm.
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A surplus account that is required by Iowa law.
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A revolving fund, also known as allocated patronage dividends, funds in this account are allocated to the individual accounts of members who purchase electricity from East-Central Iowa REC during a given year.
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Because patronage dividends may not be retired for several years, it is important that you keep the Cooperative informed of your current address.
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Unclaimed patronage dividends go into a Community Reinvestment Fund used for educational purposes.
Read more about patronage dividends in our brochure.