Operating Costs: The cost to maintain, repair, and construct the electric system (poles, wires, substations, etc).

Margin: At the end of the year, SCI REMC subtracts operating expenses from the amount of money collected, and the balance is called the margin. (This is similar to “profits” at IOUs.)

Allocate/Allocation: An approved method used to assign the margins to an individual’s capital credit account.

Patronage: At the cooperative, your patronage is the amount of money you paid on your electric bill each year.

Retire/Retirement: The process of paying back the capital credits to members. The amount paid back is determined by what years of capital credits are being retired and the capital credits allocated to the member for that year. Capital credits are paid back by check or bill credit.