Cooperative Advantage and Patronage Capital

Patronage Capital

Click here to view the Unclaimed Patronage Capital webpage.

A cooperative is an enterprise that is collectively owned and operated for mutual benefit. Cooperatives are owned by the people they serve with their services provided at cost. After paying operating expenses, all remaining margins are allocated to members based on revenue received for service. These margins are called patronage capital and represent the members’ equity in the cooperative.

Electric cooperatives do not have stockholders and they do not pay dividends. Upon application, members agree to reinvest their margins into the cooperative to retire old debt, purchase new equipment, maintain adequate reserves for emergencies such as widespread storm damage, and return patronage refunds to the members. By using member-owned margins, your cooperative is able to avoid borrowing money at high interest rates.

Patronage capital refunds are made to current and former cooperative members, although the schedule and payment methods can vary from year to year. We encourage you to watch your monthly newsletters for news on the next refund. Click here (PDF) for a timeline of the capital patronage process and click here (PDF) for a list of frequently asked questions. If you have immediate questions about patronage capital allocation notices or refunds, call us or visit our service center. The number to call is (800) 831-8629.


Cooperative Principles

1. Voluntary and Open Membership
Cooperatives are voluntary organizations open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination. 

2. Democratic Member Control
Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership. Members have equal voting rights (one member, one vote).

3. Members' Economic Participation
Members contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing the cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefitting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership. 

4. Autonomy and Independence
Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.

5. Education, Training and Information 
Cooperatives provide education and training for their members, elected representatives, managers and employees so that they can contribute effectively to the development of their cooperatives. They inform the general public, particularly young people and opinion leaders, about the nature and benefits of cooperatives. 

6. Cooperation Among Cooperatives
Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national and international structures.

7. Concern for Community
While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.