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Patronage Cash Back
Your piece of the pie.
Customers of Midwest Electric are referred to as members, because you’re more than just a customer — you’re also a part-owner in the cooperative.
Patronage cash back, also known as capital credits, represents your equity ownership in our electric cooperative.
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Customers of Midwest Electric are referred to as members, because you’re more than just a customer — you’re also a part-owner in the cooperative. And patronage cash back, or capital credits, represents your equity ownership in our community electric cooperative. As a not-for-profit, community-focused organization, Midwest Electric shares excess revenue back with the members we serve.
A part of your electric bill payment is retained by the cooperative as margins, or money left over after all bills have been paid. Midwest Electric uses margins to fund capital improvements, such as building or replacing lines, installing new substations, and other electric infrastructure upgrades to meet members’ evolving needs and expectations. Each member’s share is allocated to a patronage capital account. After the cooperative uses it as working capital, the money is returned to members as patronage cash back.
Patronage cash back is like receiving a dividend from a company whose stock you own. Midwest Electric has a strong record of returning excess revenue to our members each year. Since 1955, when the co-op started distributing patronage cash back to members, Midwest has returned more than $45 million. We typically return around $500,000 to $1 million per year or more, although it is possible that more or less — or even $0 — could be returned in a given year, depending on the cooperative’s financial situation.
Patronage cash back is allocated to members in proportion to the dollar amount of electricity each member uses. It is typically credited to members’ electric bills, mailed around Nov. 21, or issued as a separate check in December.
November 2025 (news release) - Many Midwest Electric members will see a lower electric bill around the holidays. This month, the local electric cooperative is returning $1.64 million in prior year margins to current and former members.
Eligible co-op members will receive the refund either as a credit on their electric bill, mailed around Nov. 21, or as a separate check in December. This patronage cash back, also known as capital credits, is the cooperative’s margins, or money left after all bills have been paid.
As a not-for-profit community-focused organization, Midwest Electric uses these margins for investments, such as building or replacing power lines, transformers, and other electric system upgrades to meet members’ evolving needs.
After being used as working capital, the money is returned to members. It represents each co-op member’s ownership — or equity — in his or her cooperative. Patronage cash back is allocated to members in proportion to the dollar amount of electricity used.
This month’s payment will go to those who used Midwest Electric’s service in 2010. A typical residential member from that year will receive a bill credit of about $142.
Since 1955, Midwest Electric has returned more than $45 million in patronage cash back to its members.
For more information about patronage cash back or questions regarding your bill credit, contact Midwest Electric at 419-394-4110
Member-owned, not-for-profit electric cooperatives like Midwest Electric set their electric rates to bring in enough money to pay operating costs, make payments on any loans, and provide an emergency reserve. At the end of each calendar year, we subtract operating expenses from the total amount of money collected during the year and this balance is our “margins.” Excess margins are shared back with our members because we belong to them.
Member Economic Participation is one of the Seven Cooperative Principles.
It’s important that you let us know your forwarding address, so we can send you your patronage cash back check.
The patronage cash back of a deceased member may be paid – on a time-discounted basis – without waiting for a general retirement. Or, you can have the patronage account transferred to another individual.
However, these estate payments or transfers are not automatic. A representative of the estate must request the patronage cash back by submitting an official death certificate and other documents.
In order to maintain financial stability and to be fair to all members, we discount the amount of estate cash back withdrawn early to reflect the time value of money. Or, you can choose to receive the cash back at the future scheduled retirement dates with no reduction.
Sometimes, when a member moves, we’re unable to contact them and issue their patronage payment. Midwest Electric tries to locate those customers who may be entitled to unclaimed patronage cash back. After attempts to find the former member, any unclaimed funds will be reassigned to current members in accordance with the cooperative’s code of regulations.
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We encourage you to consider changing your account from an individual account to a joint account. You are not required to make this change, but there are some advantages to consider. At this time, a joint membership is only available to married couples.
The primary benefit of a Joint Membership involves how the account’s accumulated patronage capital shall be handled in the event of the death of one of the account holders.
Each member of Midwest Electric earns “patronage capital” based on the amount of electricity used and based on Midwest’s profit in that year. That patronage is determined annually and accumulated in your patronage account. Typically, each year a portion of that accumulated patronage capital is returned to Members as a bill credit or a refund check.
However, when a member dies with an individual account, the balance in the accumulated patronage capital account belongs to the deceased member's heirs. There are legal requirements to release the earned patronage, which can prolong that process.
If you switch to a Joint Membership while still married, then upon the death of the account holder, we continue to hold that account in the name of the surviving Member, and upon proof of death, we will simply remove the deceased member’s name. The surviving member will then continue to accumulate and receive the patronage capital.
Advantages of a Joint Membership:
- In the event of a death, the Joint Membership and the accrued patronage capital will remain with the surviving member. You only need to show the deceased member’s death certificate; no other paperwork is needed. This “survivorship” feature is appreciated by many married couples.
- Either Member will be able to contact Midwest and inquire about billing issues, outages, or request information or services related to that account.
- Either one of the Members is entitled to vote on matters submitted to the Membership for consideration, such as the Board of Directors elections.
- If otherwise qualified, each of the Members (but not both at the same time) is entitled to run for election to the Board of Directors.
- A good payment history for the account may be beneficial to each of the members’ credit scores or reports.
- The accrued capital credits, an asset of the account owner, are owned by each of the two Members. In the event of a divorce, each spouse would have a claim to it.
Disadvantages of a Joint Membership
- In the event of a death, the surviving member cannot elect to receive the accumulated patronage capital early in a discounted lump sum but must continue to receive it over time.
- Each of the Members of the joint account is liable for the unpaid balance due for electric services billed to that account.
Changing your electric account to a Joint Membership is easy and involves a brief, one-page form. This form must be notarized. Please contact our office at 419-394-4110 if you have any questions or would like a copy of that form.
You can also download a copy by clicking here.