Annual Meeting

As in years' past, there were more than 50 educational and informative exhibits for those in attendance to visit, including health booths, civic organizations, local industry and businesses; car displays; and many others. In addition, members were treated to some wonderful entertainment this year with opening act Southern Harmony and the featured entertainment Chris Cagle, who has had a several hits including “Chicks Dig It,” “Miss Me Baby,” “What a Beautiful Day,” and “Wal-Mart® Parking Lot.” The primary purpose for the Annual Meeting is the business meeting, which started around 7 p.m.

The cooperative’s bylaws provide that each year there shall be an Annual Membership Meeting for the presentation of reports from SKRECC officers and leadership. Re-elected to four year terms on the co-op board were Charles Gore, District 2, Jerry Purcell, District 3, and Richard Stephens, District 6.

Allen Anderson, CEO of South KY RECC, reported to the membership that the coop has been working toward the acquisition of the Monticello Electric Plant Board. On January 12 MEPB’s board voted unanimously for the sale of its assets to the co-op. Then on January 23, the city council voted in favor of the proposed sale, and it will now appear on the November 6 general election ballot for the citizens of Monticello to vote their preference. Anderson said there are many positives for the merger, including:

• The MEPB System would create an immediate revenue stream to South Kentucky RECC at a cost per member that is nearly ½ the cost for us to build to a new member

• The City of Monticello, its Citizens, and Wayne County would benefit from the revenue received from the sell over a 30 year period.

• MEPB System is in the city having more customers per mile of line (higher density than SKRECC)

• MEPB has more commercial industrial customers per mile of line

• MEPB has a higher load factor

• MEPB has a new office facility& SKRECC needs a new office in Monticello

• The two systems jointly would have stronger buying power

• The two systems would gain efficiency from eliminating duplication of services

• The two systems would have improved reliability and service restoration in time of emergencies

Anderson also told members that South Kentucky RECC’s building program is well underway and the first new facility in McCreary County is open, with the Russell County office slated to open in September. The Albany office will be next and should open by the end of the year. The new Somerset office is in the planning stages and is expected in 2009.

Anderson spoke of the many positive things that have been taking place including South Kentucky RECC’s involvement with Somerset Community College, Somerset/Pulaski County Development Foundation, Pulaski County Fiscal Court, Lake Cumberland Area Development District, All Kentucky Electric Cooperatives, Utility Contractors, and all other Utilities on the new Regional High Growth Training Center. This facility will be located behind the technology park off hwy 461 in Pulaski County. The facility will cost approximately 3.5 Million Dollars – which has been funded primarily through Federal, State, and Local Grants, and 0% Interest Loans. Anderson said South Kentucky RECC’s contribution to this effort has only been in providing labor assistance in helping to pull all the resources together, but we feel very proud to be part of this group effort. He said this facility will provide career opportunities for our young people in Kentucky that have interest in a career in the utility business, and another purpose of this facility is to support the needs of all utilities across the nation are faced with an aging work force with no experienced replacement. SKRECC could lose up to 40% of its skilled employees in the next five years to retirement added Anderson. This facility is projected to be operational in late 2008.

Another area Anderson touched on was reliability of service at an affordable cost. He said SKRECC visually inspects 3,000 plus miles of line each year which allows us to cover the entire system every 2 years. This allows for the correction of possible problems before they occur. According to Anderson, the co-op continues placing a lot of resources into improving reliability. Due to these efforts, in 2006 reliability was 99.9%. This is extremely good for a system the size of South Kentucky RECC, which manages 6,540 miles of line.

Finally, Anderson reported that South Kentucky RECC had its first rate increase in 17 years in October 2006. It was an 8.2% average increase. He stated that this increase along with expected growth in the future should make the necessary improvements to SKRECC margins and allow the co-op to meet its obligations. He said he was pleased to report that Kentucky has the LOWEST rates in the nation combining all categories, and Kentucky still has the 4th lowest residential rates in the nation. He added that South Kentucky RECC continues to closely monitor all costs, while not sacrificing quality of service and/or reliability to do so.

After the Business Meeting, South KY RECC recognized the Washington Rural Electric Youth Tour recipients and also awarded $12,000 in scholarships to 12 high school seniors in the service area as part of the Senior Scholarship Program.

South KY RECC believes that investing in our youth has a profound effect on the improvement of the quality of life in the communities we serve, which fulfills our mission. South KY RECC’s Mission Statement reads “South Kentucky RECC was formed for people not profit. Its mission is to reliably provide electricity and related services to its members at a competitive price, and to improve the quality of life in their communities.”