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Federated Rural Electric hosts 78th annual meeting

JACKSON — Nearly 500 people attended Federated Rural Electric’s 78th annual meeting Nov, 23 at the Fairmont Five Lakes Elementary School.

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“We served 480 members pancakes,” said Richard Burud, Federated’s general manager. “We had 307 members register.”

Members elected director David Meschke, Welcome, for District 5 and Bruce Brockmann, Granada, for District 6. On the Nominating Committee, David Bulfer; was elected for District At Large.

In addition, Federated recognized retiring Director Jim Oltman, Granada, for his 20 years of service.

President David A. Hansen and Burud provided a cooperative update on 2013 highlights and 2014 outlook. Hansen reported on state and federal legislation that could increase future electric rates. He asked members to become involved in the legislative process by calling, emailing or joining the newly formed member advisory committee in 2014. Members were also asked to fill out a response coupon about the EPA’s attack on coal and the Federal Emergency Management Agency’s (FEMA) denial of Federated reconstruction funds; this same form was to be a bill insert with the Dec. 1 bills for all co-op members.

Burud reported on line construction completed in 2013 and Federated’s two national awards received for community involvement, plus the April ice storm and recovery.

“While we are thankful for the 75 percent FEMA paid on the $1 million costs for outage restoration in April, they denied the $2 million to rebuild and shore up our system,” Burud explained. “We have some areas with long spans that need additional poles or areas that need upgrades to line that resists ice buildup.

“Previously, FEMA covered such expenses, but based the denial on calling them ‘not eligible’ due to a new policy requiring certain standards,” he continued. “We already build to federal standards by being a borrower from the Rural Utilities Service. We are appealing, and that’s the reason for the Dec. 1 bill.”

Burud also reported that for the first time in a decade, no wholesale power rate increase will occur.

“Federated has three wholesale power suppliers — Western Area Power Administration, Great River Energy and Basin Electric Cooperative. Not one of them will have a rate increase in 2014, plus Federated does not need a retail rate increase either,” he said,

Burud provided the membership an update on the Alliant Energy acquisition. The Southern Minnesota Energy Cooperative, consisting of Federated and 11 other electric co-ops, will buy the Alliant service area in 2014. Pending the Minnesota Public Utilities approval, Federated will then serve the cities of Heron Lake, Okabena, Sherburn, Granada and Northrop.

He also reported that Federated is financially healthy.

“Even with one ethanol plant down, but restarting this fall, Federated had revenues of $22.8 million and expenses of $20.8 million with an equity level of 57 percent,” he said.