Assessing the Ability of Rural Electric Cooperatives to Retire Capital Credits

Jeffrey S. Royer

Journal of Cooperatives, 2016, vol. 31

Abstract: This paper assesses the ability of rural electric cooperatives to retire member equity under three strategies: (1) replacing equity with term debt to provide for an immediate one-time retirement of capital credits, (2) reducing the rate at which equity is accumulated and relying more on term debt to finance asset growth so margins can be used to accelerate the retirement of capital credits, and (3) adjusting the electric rate to generate additional mar-gins for retiring capital credits. Analyses suggest that the average distribution cooperative could employ these strategies to expand capital credits retirement substantially without weakening its financial condition.

Keywords: Agricultural Finance; Financial Economics (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/244568/files/RoyerJCOOP31.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:jlcoop:244568

DOI: 10.22004/ag.econ.244568

Access Statistics for this article

More articles in Journal of Cooperatives from NCERA-210 Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().