Steve Freese
WECA President & CEO
In May I wrote about our association’s activities at the state Capitol. This month I’d like to update you on what we’re doing on your behalf in Washington, D.C.
Electric cooperative leaders and staff spent the last few days of April in Washington, lobbying to keep your electric service safe, reliable, and affordable. More than 65 cooperative leaders from Wisconsin joined me in this effort, along with 2,000 from other states. We talked to members of Congress about three issues affecting Wisconsin electric co-ops and the communities they serve.
One issue was keeping the cost of electricity affordable. Recent changes to the federal tax code created an unintended consequence for electric cooperatives. For the first time, government grants for economic development, storm-damage restoration, or broadband deployment could jeopardize your co-op’s non-profit status by being treated as taxable income.
We told our federal representatives Wisconsin electric co-ops shouldn’t have to choose between restoring power after a disaster and preserving tax-exempt status—after all, co-ops are taxed on excess revenues not plowed back into the business or returned to members. We requested support for House Resolution 2147 and Senate Bill 1032 that will modify the definition of income in determining electric co-ops’ tax-exempt status.
We also discussed an issue that could affect the reliability of your electric service because it clearly affects your co-op’s ability to attract and retain quality personnel to work on its electric lines and systems.
Co-ops have to offer good jobs with benefits in order to compete for the services of top-notch employees. Those benefits need to include health insurance and a pension plan. Currently, the pension plan offered through the National Rural Electric Cooperative Association (NRECA) is being overcharged by the Pension Benefit Guaranty Corporation (PBGC). The NRECA pension plan covers more than 880 participating rural electric cooperatives, with more than 56,000 employees in 47 states.
The PBGC treats all 880 co-ops as single employers subject to great volatility and likely to go out of business all at the same time. These bizarrely unrealistic assumptions result in Wisconsin’s electric cooperatives paying 87 percent more than they should—almost $700,000 annually—to insure their pension program. Our statewide association has been working with Congressman Ron Kind and he is advancing legislation that should correct this issue.
The third issue we discussed involves the needs of rural communities in any infrastructure package arising from the bipartisan agreement that appeared, at press time, to be in the making. We told our representatives Congress should look beyond the big cities and standard road and bridge projects. We encouraged them to look at three additional key infrastructure investments: modernizing the electric grid, expanding rural broadband access, and electrifying the economy by expanding the use of electricity as a basic energy source to supplant fossil fuels. We as electric cooperatives will support a robust infrastructure package that improves America’s rural communities.
I had the opportunity to visit with seven members of Congress or their staff and I saw the capable lobbying performance of Wisconsin electric cooperative leaders. I am hopeful we will be able to report on success from these efforts in the near future.