Another Benefit of Cooperative Membership: Allocated Equity

The benefits of cooperative membership are many. This January, they added up to more than $421,000 in allocated equity returned to members and former members of The Alliance. Alliance Standard Equity members and former members during 2003 to 2006 received checks earlier this month.

Due to the careful stewardship of resources, we have achieved reserve levels that now exceed our foreseeable capital needs. As a not-for-profit cooperative, we return these dollars to the equity members in the form of an allocated equity payout.

What is Allocated Equity?

Allocated equity is the portion of the annual net proceeds that is credited to each member’s account based on their use of the co-op in a particular year. Each year The Alliance Board of Directors reviews our financial position to ensure we have adequate resources to run the cooperative. If our reserve level is sufficient, we are able to “retire” allocated equity as we did this year.

The Advantages of Equity Membership in The Alliance

Only Standard Equity members (full owners) of the cooperative are eligible to receive allocated equity payments. This is just one of the benefits of this class of membership. In addition, these members also vote in all elections and have a greater presence on the Board of Directors.

Standard Equity members also receive a patronage check once a year. This is a portion of our annual net proceeds not kept on the books to run the cooperative.

The Alliance also has an Associate class of membership. Associate members do not receive these distributions, do not own stock in the cooperative, and may only hold one seat on the board. Typically, these are employers that are headquartered outside or our primary service area and that have 50 or fewer employees accessing The Alliance network.

With our expansion into northern Illinois, some members who are currently Associate members may now be eligible for Standard Equity membership. If you are interested in learning more about the different types of membership or the potential for becoming a Standard Equity member please contact us.