Local electric and telephone cooperatives would be able to keep more of their revenue under an act set to become law in South Carolina.
Utility cooperatives are electric or telephone services that are owned by the members, who also act as customers. It’s similar to owning stock. At the end of the month, any excess revenue (profit for a traditional company) is split proportionally among the co-op’s members (much like a dividend).
If a person does not claim their share of the revenue, called “patronage capital,” it’s automatically sent to the state under the Unclaimed Property Act.
The Legislature passed a bill earlier this year that allows co-ops to keep the unclaimed money and invest it in renewable energy, educational services, economic development, or for charity.
Rep. Mike Gambrell (R-Honea Path) said it keeps the money local.
The thing I like about it is that we can use it in our rural areas to help, especially on the economic development.
However, Rep. Jim Merrill (R-Charleston) called it a “terrible idea” that would take $540,000 out of state coffers every year.
We fight over a hundred dollars and, yet, we’re just… going to take this money out of the General Fund because a couple of lobbyists said they want to do it. It doesn’t make a lick of sense.
Merrill said he was unhappy about how quickly the legislation made its way through both chambers with little discussion. Although he was critical of the bill, he ultimately voted for it. It ended up passing both the House and Senate unanimously.
The cooperatives would still have to repay if a member later came forward to claim their share of the patronage capital.
The bill is a procedural step away from heading to the governor’s desk.