Episode Transcript
[00:00:00] Speaker A: Foreign.
[00:00:07] Speaker B: Welcome to the Buzz, a podcast by Boone Electra Cooperative. The Buzz is a monthly message to our community celebrating what it means to be a member owner of your local electric cooperative, Boone Electric Cooperative, your co op, our community.
[00:00:26] Speaker C: Welcome back to the Buzz, Zach. I'm Zach Smith, communications specialist here at Boone Electric Cooperative, and if you're a Boone Electric Cooperative member or you follow any of our social media channels, you've probably seen a lot of communication from us recently about a variety of topics. We just got done earlier this summer talking about the capital credit allocation notice and all that entails. We're getting ready to push out a lot of information about our annual meeting coming up in September. And it's a lot to take in if it's not something that you follow every single post or every single year. And so here to answer some of our most frequently asked questions, or perhaps most misunderstood facts, is Boone Electric Cooperative's assistant general manager, Vicky Kemna. Vicky, welcome to the show.
[00:01:10] Speaker B: Thanks, Zach.
[00:01:11] Speaker A: Thanks for having me.
[00:01:12] Speaker C: And the reason that you are here sitting in the hot seat, so to speak, and not just me yapping at the audience for however long that would take, is because you have heard a lot of these questions over the course of your career here at the cooperative. How long have you been with Boone Electric?
[00:01:28] Speaker A: I started at the co op in May of 1992, so it's been 34 years.
[00:01:34] Speaker C: And you started as an intern, if I remember.
[00:01:36] Speaker A: That's right. Yeah. I was going to school at the University of Missouri and took a position as an intern in the communications department in the department that you work in. So I started out in public relations and marketing.
[00:01:47] Speaker C: This is a little bit of a segue from our topic, but because we just hosted a lot of folks from various schools, counselors, administrators, talking about careers. I'm just curious because I get asked this question sometimes. When you took that internship or when you were in school, did you ever one day think that you would be working at an electric cooperative?
[00:02:09] Speaker A: That's funny. No, I think about that a lot, actually. And I wish, and I've told people this over and over again now that I've had this long career that I wish I would have paid more attention in science class in high school because I never in a million years thought that I'd be working for an electric utility.
[00:02:25] Speaker C: Yeah, same, same. I have that same thought quite frequently.
It's not. It's perhaps not good how little I know about electricity. There's a reason that we work up here and not out there in the field.
[00:02:37] Speaker A: Exactly.
[00:02:39] Speaker C: Some of the questions that we receive are questions that are, you know, important to the members. They want an answer and they sometimes the questions make it all the way through.
Member service representatives, communications department, whoever ends up speaking with a member out in the field, maybe, and they come up to you. Why do you think it's important that we answer these?
[00:03:03] Speaker A: It goes back to inquiring minds want to know. And I think a lot of people just don't understand.
A lot of times it's not that they disagree with something that we've done, they just don't understand.
And they want to know that they can trust the electric cooperative because we are member owned and, and that we're making the best decisions that we can make on behalf of the entire membership. And a lot of it just comes down to, you know, not understanding or sometimes miscommunication. And that's what I'm here today to do is just try to have some straight talk and answer some frequently asked questions that, you know, inquiring minds want to know.
[00:03:39] Speaker C: Sure. We'll start with a big one right out of the box. Why did you build such a nice building? What was wrong with the old one?
[00:03:47] Speaker A: Well, I can tell you from working here for so long, what was wrong with the old building?
We had offices in our building.
The original building was built in 1954 and parts of that building were still in use.
The entire building actually was still in use. And we have added on to that building in 1974 and in 1996. And we just kept adding on and, and putting a roof over structures to make them combined into one larger headquarters facility.
And combining roof lines posed some problems for us. And we had offices that had buckets in the drop ceiling to catch the roof leaks. And sometimes it was like a water park feature. If it rained too much, we, we would have those buckets dump on, you know, our computer equipment or our employees. And it just wasn't a good working environment. So the roof, the old roof was really problematic for us. And we looked at the cost of replacing that roof all with one, you know, solid seam basically, and looked at the cost of that versus, you know, constructing a new facility. And we had some other areas that the building just wasn't working out for us in the way that we needed. It wasn't the most efficient process. We had departments that work closely together that were kind of far apart in the building.
So we took the opportunity to completely demolish most of the old campus. We bugged out 1413 Rangeline street for a couple, a few years, actually three years. It is big, but we have planned it that way on purpose, hopefully that we won't outgrow this facility for the next 50 years.
[00:05:38] Speaker C: You take a building that was almost 70 years old and you've been adding onto it to accommodate changes. And the industry, obviously we talk a lot about the technological change that the electric industry has seen, but you think about all those other changes to tech in the office or needs of departments and all that stuff adding up over time.
Obviously you're going to have some room to improve some efficiencies with the new building. And as anybody who's dealt with homeownership or anything like that knows, sometimes you just get to a point where it's actually cheaper, crazy as it may seem to take everything down to the, to the bare wood floor and start over again.
[00:06:22] Speaker A: Absolutely. I can assure all of our members that we did a lot, a lot of financial analysis on the impact to our, our financial position and what was going to be best use of the cooperative money. It was a substantial investment, but we also did it.
You know, you never know what the future is going to hold. And looking back, we were pretty smart in building the building when we built the building because interest rates have gone up since then substantially. So the building that we have today would have cost us significantly more money if we had waited to build it now versus even, you know, five years, five, six years ago.
[00:07:03] Speaker C: Sure.
[00:07:04] Speaker A: Started in 2020.
[00:07:05] Speaker C: Not to mention materials.
[00:07:07] Speaker A: Absolutely. Material. Yeah, material costs have skyrocketed. We ordered our steel for our building just at the right time. We got lucky there. And so, you know, hindsight's 20 20.
[00:07:18] Speaker C: Sure.
[00:07:18] Speaker A: But I think it made the most financial sense and I'm proud of what we have here.
It's a beautiful building and I encourage any member that wants to come and visit, you know, they own this building and so anytime they want to come and tour, we'd be happy to show them around.
[00:07:35] Speaker C: People seem to like it. I hear a lot of compliments on it, even from folks who aren't members who use our community building, which prior to the construction of this whole brand new part of the campus that was a community room and it was quite literally a room. And now, you know, you've got the ability for three groups to have meetings, some people hold all day trainings. It's, it's become quite a big feature of this new building that we have now.
[00:08:02] Speaker A: It is and so proud of it. And we hear that from a lot of groups and organizations in the community that use it, that they're so appreciative of you having a basically free facility for them to hold a meeting or a training seminar. It gets used by any nonprofit. We have a lot of state agencies that come in for statewide training, city and county training.
We're happy to host them and show off our facility and be able to. To show the community that we are here for the long haul and we are committed to the betterment of our community.
[00:08:36] Speaker C: Well, sticking with the questions that we get that probably originate from folks driving by on Rangeline, why did you. And I mean, of course you specifically, why did you remove the bus stop bench and. And put up that scalloped metal edge thing on the retaining wall that's up front?
[00:08:54] Speaker A: Yeah, this one is kind of a hot topic here recently since the city came and removed the bus stop bench. I did not remove it personally, but it has been removed from the front of our building.
And when we built the building, we had to comply with the city codes. And our former building had a bus stop, a city bus stop that was right in front of our. Right next to our main entrance. And there was no really good shoulder for the bus stop and for the people waiting for to get on and off the bus. It was right at a busy turn in and turn out. And it was kind of dangerous for the patrons of the city bus. It made being able to pull out of our driveway either to make a right turn or a left turn kind of dangerous when the. When the bus was parked there. So when we built the building, they. The city moved the bus stop a little further south, which did help the line of sight pulling in and out of our main driveway. But it became a gathering area for many people that would ride the bus and then also not ride the bus. Unfortunately, everyone knows that the city of Columbia has an unhoused population that can congregate in areas. And. And I have a lot of empathy for those people. But we also have a obligation to the members that come into our property, onto our property, and also our employees to provide a safe environment for them. And we were seeing that we had groups of people that were not using the bus stop to get on and off the bus. They were sitting and loitering basically all day. And we could see these from, you know, see these people from our windows. Also on our video camera, we had video of a person that took a machete to our beloved pine tree that we decorate each Christmas with beautiful Christmas lights. And it gets a lot of. It's well known in the community. And then the gentleman was seen on Video using a machete to try to damage the tree, also remove some of the Christmas lights from the tree. So this area of our property became a problem area for us. Our grounds crew were finding awful, unsanitary situations with a lot of trash. Even human feces were left, you know, in the yard. Folks, you know, sleeping all day. And it just became a nuisance and really an unsafe area for our employees, even so much that the.
We had a city worker came to us and said they're not able to empty the trash can at the bus stop anymore because they felt unsafe going and stopping at that bus stop when there were so many people gathered around.
So I did make a phone call to the city and talk to the city transit supervisor, and they came out and reviewed the situation and also made the determination that something needed to be done to make sure that area was safe. So the city. It was the city's choice. They made the call. We put up the scalloped edging on the retaining wall because that is private property. And we were finding people that were just, you know, sitting all day and in the hot sun. I can understand people wanting to sit under the. Our big shade.
[00:12:19] Speaker C: Sure.
[00:12:20] Speaker A: We appreciate, you know, we have private property and we. We want to maintain a clean and safe environment. And. And we were just getting inundated with trash and some unsightly things that were left and very unsafe things that were left on our property. So we appreciate and we want to encourage people to use public transit. But it's supposed to be a bus stop. It's not a bus station, not a bus stay. So getting in and on and off the bus is fine, but we just can't have people loitering all day and all night. It's just not safe for our employees and our members who come to. To the headquarters or the.
[00:12:58] Speaker C: Again, the folks who visit the community building, who are sometimes from out of town, and absolutely don't know anything about that situation.
[00:13:04] Speaker A: We've had cars that were broken into while people were here for a meeting. So we take pride in our facility and we want to make sure that the people are safe and feel safe when they're here.
[00:13:16] Speaker C: And just to clarify, it's just the bench that's gone. The bus stop obviously still exists.
[00:13:20] Speaker A: Absolutely.
[00:13:20] Speaker C: Place for people to get on and off.
[00:13:22] Speaker A: Yes, absolutely. The bus stop is still there. They just removed the bench.
[00:13:25] Speaker C: We'll move on to another topic that we typically, it's two time of year. We get a lot of questions about it. What happened to my capital credit check?
[00:13:32] Speaker A: Nothing really happened to it, except that we stopped mailing, making, getting a check the default method of receiving your capital credits. Hopefully everyone is aware of what a capital credit is, but I will give a little bit of background. Capital credit is your portion of the profits that we make at our cooperative each year.
And we call those in cooperative world we call them margins instead of profits because we are a not for profit utility and we are member owned. So each year if we bring in more revenue than we have in expenses, we have a profit or a margin and then those margins are held for a time and used by the co op as operating capital to save us from having to borrow so much money from the bank.
So if you could think of that as a way of your own in your own paycheck. So if you, you know, you have, you have revenue coming in in your paycheck and you have household expenses that you're paying for, any money left over at the end of the month, you can save that money up for maybe a household repair or something or to buy a new car, any of those things that you would use your savings account for. So we would, we save those, the margins for time and we use that, we use it to help pay for the new trucks that we have to have and the new building and things. So we don't have to borrow so much money from the bank. But we are obligated to pay that back to our members because it is our members portion of their ownership in the cooperative. When we're in the financial condition to do so, the cooperative will return that profit or that margin back to the members in the form of a capital credit retirement. And in the past we had done that in the form of a check. And that check was given out, mailed out to the members in December of each year. I think as long as I've been here, we have given back retirement every year.
We've not missed a year in the 34 years that I've been here.
[00:15:39] Speaker C: That's a strong record.
[00:15:40] Speaker A: Yeah, absolutely. And it's like I don't have the number off the top of my head, but I think we're up to like 70 or 80 million dollars returned since the beginning of when we started giving back capital credits in the late 1950s.
So it's a staggering amount of money and it's, it's a great, it's a great thing to be a member of a cooperative.
[00:16:02] Speaker C: Yeah, it's one of the many things that sets us apart from other electric utilities.
[00:16:07] Speaker A: So you know, as, you know, over time the postage Rates have gone up significantly and sending that capital credit check by mail has gotten to be more expensive.
So the members are still getting that the value of that capital credit, but it's now applied, the default method is applied to their electric bill, which will be seen on the December electric bill each year. Honestly, I, I'm just as guilty as a lot of our members out there. I don't look at my monthly Boone electric bill every month. So you, sometimes you, you miss it. You don't want, you don't realize that it was applied. But I assure you that the members that it was applied to their December utility bill, so they're getting the value of that capital credit.
[00:16:54] Speaker C: And for people who have, are used to receiving a check for 34 years or however long they received one, I'm sure when they stopped getting the physical check in the mail, they just assumed they, we weren't giving them capital credit anymore.
[00:17:07] Speaker A: Absolutely. That it makes perfect sense. And hopefully, as we can explain this, people will realize and maybe and look at their December utility bill and say, oh, yeah, okay, I got that back. And I know it's not money, you know, in your hand, but if we're taking that money, if you owe $200 on your utility bill and we send you and we, you know, give you $100 credit on that utility bill, well, that's $100 less than you would have to pay us. So you still have that $100 in your bank account. Instead of giving us $200, you're only going to give us $100. And we took $100 off of your utility bill, so we're not taking any money from you. We're just giving it. You're just seeing it in a different form.
[00:17:48] Speaker C: Yeah. It's not money in your hand, but it's money that didn't leave your bank account.
[00:17:52] Speaker A: Exactly.
[00:17:53] Speaker C: So you still.
[00:17:53] Speaker A: Money that stayed in your hand.
[00:17:55] Speaker C: Right, Exactly.
And a lot of people ask about that this time of year too, because we just sent out the capital credit allocation notices. And one of the questions related to that that I've heard is I got this allocation notice of what has been put into my retirement account for my capital credits. Why can't I have that money returned to me now? And I know you sort of already answered that as far as why we hold onto that money and how it's dispersed on a first in, first out, last in, first out basis. All that stuff that we talked about before.
[00:18:26] Speaker A: Capital credits can be confusing. Sure, it's complicated because most businesses don't
[00:18:33] Speaker C: offer that probably because it's so complicated.
[00:18:36] Speaker A: So it is unique and it can be confusing to understand it. But the allocation notice shows the member's portion of the margins that they made for the last calendar year. So the allocation notice that the members just received was showing their earnings, their portion of the profit that the co op made in 2025. And then it shows the value of their entire retirement account. And like I said before, we hold on to that money to use that money so that we don't have to borrow so much money from our lenders to for operating expenses. That money will be returned to the members over time.
There's a terminology in co op finance world, it's called lifo. Fifo.
Last in. It stands for Last in. It's an acronym that stands for last in, first out and first in, first out. In the 90s we had a FIFO method of capital credit retirement. Therefore members had to wait sometimes 20, 30, 15, 20 years before they got any of their capital credits returned to them. I think in the early 2000s, maybe I'm getting my, my years confused, but the board decided, you know what, we can show that there's a value to be a member of a co op. So they changed the capital credit retirement method to being partially FIFO and partially lifo, which is last in, first out. So that means the more recent you member you are, if you had service with us last year, you're going to get a portion of the pot of dollars that the board approves to retire to our membership. So as an example, if we would give $2 million back in capital credits in 2025, 1 million of that went to members who were on our lines in the late 1990s. And then the other million went to members who had service with us just in the last year, in 2024.
[00:20:42] Speaker C: It's one of those things that is really helpful in demonstrating to someone, especially if they're new to being an electric cooperative member, what the value is. Because not all utilities offer that. The FIFO LIFO way that we do. It might be different at another co op depending on what their situation is, but it's a good way to kind of let somebody who's new to this whole cooperative world know that this is different from your average utility. You have a stake in the game from, you know, day one.
[00:21:11] Speaker A: Essentially, that's the one thing that really makes us different than other types of utilities is that we are member owned and we give back our profits and our margins to our members. So we also had, you know, when we were doing strictly a FIFO type retirement. Boone county is a very transient county.
[00:21:36] Speaker C: Yes.
[00:21:37] Speaker A: And our entire service area is a very transient county. While we have lots of members that have been with us since the 1930s when we first started, we also have a very high percentage of members that are here because they're in college. So they are only here with us for a short time. So we have a really high move in, move out, connect, disconnect rate compared to other rural electric cooperatives. So we were finding that when members moved away, we were having a hard time tracking them down. And we were doing that before the Internet. And it's now easy to Google search your name and you can say, oh, well, I can see that I have, you know, Boone Electric's been trying to get in touch with me to give me this money back. And you can, you can Google search your name and see if your name pops up on a Boone Electric registry. Now that we publish everything online in our website, but prior to the Internet, we just had to rely on the last address that we had on file. And some people not realizing that they were going to get money from us in the future.
[00:22:39] Speaker C: Exactly.
[00:22:40] Speaker A: Did not leave us a correct forwarding address. Therefore, we had a lot of unclaimed capital credits. And we want to give that money back to the members. It's their money.
[00:22:50] Speaker B: Right.
[00:22:51] Speaker A: So this, doing this this way, we're able to track people down and give them the money that they, that they've earned.
[00:22:59] Speaker C: And I'll use this opportunity. I feel like I do this every other episode now. But please, if you have changed any sort of contact information recently, please give us a call to get. To get that updated on your account so that we have a way of finding you.
[00:23:13] Speaker A: Absolutely.
[00:23:14] Speaker C: Or if you're planning to change your address or something like that, the near future.
And that's about as good a place as any to put a pin in our Part 1 conversation of the most frequently asked questions about Boone Electric Cooperative. Thank you for tuning in. And if you'd like to hear part two of our conversation with Vicky Kemna, stay tuned to the channel later this month. And until then, we'll see you somewhere down the line.
[00:23:36] Speaker B: Thank you for tuning in to the Buzz, a podcast by Boon Electric Cooperative. To subscribe or for more information, you can find us on Facebook, Instagram X and LinkedIn. And of course, you can always visit us 24, 7@BooElectric Co op. Boone Electric Cooperative, your co op, our community.
