Members of the Kaua‘i Island Utility Cooperative are meeting today to determine how best to provide rebates to its members. The rebates are to come as one-time reduction in a future electric bill. The fact that leaders of Kaua‘i Island
Members of the Kaua‘i Island Utility Cooperative are meeting today to determine how best to provide rebates to its members.
The rebates are to come as one-time reduction in a future electric bill.
The fact that leaders of Kaua‘i Island Utility Cooperative are even in a position to offer rebates to members after barely a year into co-op ownership is unique, said Alton Miyamoto, KIUC president and chief executive officer.
Normally, a rural utility co-op won’t have sufficient capital built up to be able to offer member rebates, called “retirement of patronage capital” in co-op lingo, until 15 years or longer into their existence, he said.
“It is very, very unusual” for co-op leaders to be in the position to offer rebates to members this early in a co-op’s history, he said. “Otherwise they (members) would have waited 15 years or so” for rebates.
“This is the best news we’ve had,” he said.
“Typically, co-ops aren’t able to give patronage capital (until) 15 years or longer” into their existence, because co-op leaders aren’t in sound enough financial shape to do so, said Miyamoto.
Members of the KIUC board at a meeting set today at 1 p.m. at KIUC’s Pahe‘e Street headquarters in Kukui Grove Village West, are to determine the exact way to disburse the rebates.
But, the rebates per member won’t nearly equate to a month’s bill, as was incorrectly reported in yesterday’s issue of The Garden Island. Nor will the rebates, expected to be distributed next month, be the second such patronage capital KIUC members will have received.
Members will recall that when the former Kauai Electric was purchased by KIUC from Citizens Communications of Stamford, Conn., Citizens’ leaders agreed to pay $3 million to KIUC members, to be spread out to all members depending on how much electricity they used over a particular period.
That rebate was not the same as the patronage capital payments, he said.
The patronage capital of around $1.8 million to be distributed next month, Miyamoto said, represents 25 percent of last year’s KIUC profits.
It took special approval from the U.S. Department of Agriculture’s Rural Utilities Service and National Rural Utilities Cooperative Finance Corporation (KIUC’s lenders), requested by KIUC’s officers and board members, to enable them to even offer the rebates, Miyamoto explained.
Board members and KIUC’s staff leaders pushed for the special authority to give rebates because of members’ concerns over high electric bills, said Miyamoto.
