Our Roles and Responsibilities: Financial Stewardship

Baldwin EMC Board of Trustees

In September of last year, Baldwin EMC sustained quite a blow (no pun intended) when Hurricane Sally took an unexpected turn, making landfall directly in our service territory. It was the culmination of a year of unprecedented events, including the Covid-19 pandemic, which caused many of our members to lose income and struggle to pay bills.

Like many local businesses, Baldwin EMC faced the challenge of keeping our operations going, while incurring the financial strain that 2020’s events created across the country.

Fortunately for this cooperative, years of sound financial practices put us in a good position to be able to balance those challenges.

That financial stewardship doesn’t happen by accident, and ensuring it is the responsibility of your democratically elected Board of Trustees.

Every year, Baldwin EMC’s management team develops and presents yearly budget plans to us for review, feedback and either edits or approval, whichever is appropriate.

These budgets dictate the spending that the cooperative’s employees do – from new vehicles and equipment, to training and office supplies. The budget approval process requires that we be forward-thinking, while also taking into consideration how the co-op’s income and expenses could fluctuate. We rely on the input of our experienced leadership team, along with the insights we gain by staying abreast of industry trends and changes through training and networking.

In order to make sure all of our financial operations are being handled ethically, accurately and efficiently, your Board of Trustees also contracts an independent, licensed auditor once a year. This audit, directly reported to the board, helps us evaluate the success (or lack thereof) of our policies and budget, the performance of our team and how our decisions are affecting the long term resiliency of the cooperative.

Earlier this year, your board was faced with a difficult decision regarding Baldwin EMC’s financial future. Due to a very active and catastrophic hurricane season, we ended 2020 with negative margins, which meant it was not financially prudent for us to approve the allocation of capital credits for the year. This is an uncommon decision for the Board to make. The last time was 16 years ago, following the effects of Hurricane Ivan.

To be clear, capital credit allocations are still the right of every Baldwin EMC member. That has not and will not change. We expect to resume the distribution of future allocations when the cooperative’s negative margins are recovered.

As 2021 progresses, we will continue to monitor the financial operations of your cooperative, through monthly reports from our trusted accounting team. This is one of the most significant responsibilities your board carries, and one of the areas where you, our members, place the most trust in us.

As always, if you have any questions about our financial operations, or any of our policies, please don’t hesitate to reach out to us. We’re here to serve you, answer your questions and take steps to make sure your cooperative is here for many more years to come.

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