ECI REC Celebrates Platinum Anniversary

The 75th anniversaries of the parent cooperatives of ECI REC take place in 2012 and 2013. “Your Cooperative is proud to have served its members and contributed to our local communities for such a substantial period of time,” said CEO Harry Ruth. “I hope we have demonstrated the benefits of receiving electricity from a utility that you, our member-consumers, own. The Board of Directors, which you elect, as well as myself, pledge that East-Central Iowa REC will continue to be an asset to the families and businesses in our region of Iowa for another 75 years and beyond!”

To celebrate this milestone, ECI REC has put together a history of those cooperatives—Benton County Electric Cooperative Association and Buchanan County Rural Electric Cooperative—from which ECI REC was born.

ECI REC: The History of Your Electricity

East Central Iowa Rural Electric Cooperative became a reality in 1995, born from two independent county electric cooperatives. Before they voted for consolidation, these cooperatives, Buchanan County Rural Electric Cooperative (REC) and Benton County Electric Cooperative Association (ECA), had operated separately for nearly 60 years. Today, ECI REC serves over 6,700 member-consumers with over 2,250 miles of electric lines in 11 counties.

This present prosperity would never have been possible without the vision and commitment of the Cooperative’s earliest leaders: those who founded ECI’s two parent cooperatives and were determined to bring electricity to rural Iowa.

Benton County Electric Cooperative Association             

In the fall of 1936, near the end of the Great Depression, representatives of farm families in Benton County met to discuss the possibility of bringing electricity to the rural areas of the county. In addition to the obvious advantages of having electricity at their farms, the men were motivated by another recent event. As part of the New Deal, President Franklin Delano Roosevelt had just signed the Rural Electrification Act (REA), which provided federal loans for the installation of electrical distribution systems to serve rural areas of the United States.

Gus A. Carlson, who would become director of the future Benton County ECA in 1945 and again in 1961-1966, as well as unofficial poet of the cooperative, wrote this acknowledging the importance of the REA loans for the early cooperative:

                In mansion or in cottage small,

                It lights our work and play,

                And gives us carefree power, too—

                Thank God for R.E.A.

By the time Carlson wrote this poem, he could look out on the countryside of Iowa at night and see the farmhouses aglow with electricity. When the first representatives met in 1936, however, they could hardly have imagined how their small cooperative would grow, considering their humble beginnings.

The Benton County ECA was incorporated in March of 1937 with a nine-person Board of Directors. Initially, there was a single substation to distribute energy, north of Garrison. From there, the cooperative put in approximately 170 miles of lines to serve the first 500 subscribers. And as the demand for energy in rural Iowa grew, so did the cooperative. More substations were built as the cooperative expanded, and electricity was purchased from the Iowa Electric Light and Power Company to meet demand.

The first general manager, Ivan Trottnow, served until 1953, when he left to manage the Central Iowa Power Cooperative (CIPCO). CIPCO had been formed in 1946 by Benton County ECA and seven other rural electric cooperatives when the Iowa Electric Light and Power Company informed the cooperatives that it was no longer able to supply the power they required. The arrangement between CIPCO and the cooperatives was a historic event, as it was the first example in the entire country of joint effort between an REA financed system and a privately financed company. Despite criticism and uncertainty at the time, the relationship continues to this day.

Benton County ECA continued to grow. The report for the year 1967 put the total number of members served at 2,496, with 839 power lines energized. The group found time for fun as well—the program for the 32^nd Annual Meeting of Members (1968) included performances by “fine young organist” Miss Twyla Briley and country western music by the Wapsie Valley Boys swing group. In the 1960s, annual meetings were scheduled on Kiwanis Pancake Day in Vinton, with the cooperative contributing to the Kiwanis project by buying pancake tickets for all members attending the meeting.

An article in the Vinton Daily Times from 1969, titled “R.E.C. brings wonders of electricity to farms,” reflected on the great impact Benton County ECA’s commitment to rural electrification had made on farms since the 1930s. The article reminisces: “It is difficult today to conceive the changes that have taken place in farm living since 1937. Labor saving devices have shortened the working day and freed both farmer and his wife from the drudgery of chores that never seemed to end.” Statistics show that little more than 10% of farms were electrified in Iowa before 1935.

The article also outlined the benefits of the “cooperative” aspect of Benton County ECA. One of the numerous examples given was the coming together of 27 men and 14 trucks from other RECs to help restore power in Vinton after a big wind storm in 1961. Because of their cooperative membership, farmers were able to overcome obstacles that they never could have alone.

A series of capable general managers led Benton County ECA during its history. After the death of General Manager John D. Ruehle in 1965, Macy E. Garwood was selected to take his place. Garwood served until his retirement in 1985, and Martin K. Gardner was selected as the general manager of both Benton County ECA and Buchanan County REC as part of a shared management agreement. He would lead the two cooperatives into consolidation, and the future.

Buchanan County Rural Electric Cooperative

Two years after the first meeting of the Benton County ECA, and only one county away, D. E. Western, a Buchanan County agricultural agent, was on a mission. He had seen the benefits of rural electric cooperatives, and was trying to convince farmers in Buchanan County to start one of their own. This was not easy: some farms had generators, but less than 5% of farms in Buchanan County received power from a central electricity distributor. Many farmers did not believe they could operate their own electric system. Another problem was that 62% of the farms were operated by tenants—it was the landlords who had to be convinced of the importance of wiring for electricity.

Western was relentless, though. He held many meetings around the county for interested groups. With a number of Farm Bureau leaders, he toured seven other rural electrification projects in Iowa. His hard work paid off later in the year, when on August 16, 1938, Buchanan County REC was incorporated.

Buchanan County REC, like Benton County ECA, made use of REA loans. The first REA loan was for $293,000, with which the cooperative was able to build one substation and 271 miles of electric lines to serve its first 509 members. The cost of membership at the time was $5.00! The lucky first member to receive service on November 28, 1939, was E.R. Halstead of Independence.

On the 20^th anniversary of the cooperative, the president of the Board of Directors at the time, H.A. Schares, delivered this message: “It is very hard to visualize that only twenty years ago I was living in the ‘dark ages’; the age of no modern conveniences as compared to our modern way of living . . . Then in 1935 came the Rural Electrification Act making money available to loan to electric companies to build lines in rural areas.”

Like Benton County ECA, Buchanan County REC grew quickly. From the first 509 members in 1938, the cooperative grew to 1,000 strong in 1942, and connected their 5,000^th member on July 1, 1983. The cooperative had some tough years, however. In March of 1975, a major storm caused $344,000 in damage to the service area. Then, almost exactly a year later, another storm caused $196,000 in damages. Through the combined efforts of its members, the cooperative kept rebuilding.

The first general manager, Alwin J. Tonn, served until 1941. Carl K. Kruempel was general manager from 1941 to 1976, and Glenn E. Maynard from 1977 to 1991. Upon his retirement, Martin K. Garner, general manager of Benton County ECA, was selected as general manager for Buchanan County REC as well, through a management sharing agreement.

Consolidation

The shared management arrangement between Benton County ECA and Buchanan County REC led to significant cost savings. The Board of Directors at both cooperatives began to see the potential for savings in other areas as well. Sharing insurance carriers, attorneys, auditors, computer systems, and engineering plans would lead to significant savings. A consolidated cooperative, in addition, would eliminate duplicate board meetings, financial reports, quarterly reports, annual reports, construction work plans, long-range work plans, and financial forecasts—in short, consolidation began to look more and more attractive.

In 1993 and 1994, the two cooperatives conducted feasibility studies for consolidation. They concluded that the projected savings would be $130,000 per year—$1.3 million by 2004. The Boards of Directors reviewed the studies and unanimously proposed the consolidation to the membership.

 In a publication sent to members about the consolidation, the Board presidents emphasized the similarity of purposes between the two cooperatives, the significant cost savings, and the challenges faced by both to keep rates affordable. They also cited the declining farm population, which led to a decrease in the number of ag members.

The vote had to be at least 66.67% in favor of consolidation, with at least 50% of the members of each cooperative voting.

Any worries that the plan would not be approved were unnecessary. On January 21, 1995, the member-consumers of both cooperatives voted for consolidation. On October 1, 1995, East-Central Iowa REC was formed.

East-Central Iowa Rural Electric Cooperative

East-Central Iowa Rural Electric Cooperative(ECI REC) held its first Annual Meeting of the Members in June of 1996. Initially, offices and operating centers remained open in both Independence and Vinton, and Martin Gardner was retained as the general manager. In 1998, after discovering structural damage to the office in Vinton, a new office facility was built in the BECCA Industrial Park located in Urbana, Iowa, on property owned by ECI. Non-field employees from each district office moved into the new Urbana Administrative Headquarters and the office was officially opened for business on December 14, 1998. The operations departments at District 1 (Vinton) and District 2 (Independence) remained open in their respective locations in order to provide good response times and service in their areas.

When Gardner retired in December of 2002, the Board of Directors began a national search for his replacement. On August 4, 2003, Harry Ruth, who had worked with two electric cooperatives in Michigan, became the new general manager and CEO of ECI REC. Ruth’s leadership continues today.

In 2004, ECI’s history of cooperative effort amongst members and between Iowa cooperatives took on a national scope. ECI REC joined Touchstone Energy^®, an alliance of 640 electric cooperatives around the country that collectively deliver power to more than 30 million consumers. Touchstone Energy is the national brand for electric cooperatives, and can provide resources from a national network to local cooperatives like ECI. They provide programs (such as online energy audits), information (through conferences, publications, and advisory councils), and ongoing employee training and education.One example is the Together We Save campaign, which delivers energy-saving tips via print ads and television commercials to a national audience.

Since 1946, when ECI REC’s two parent cooperatives, Buchanan County REC and Benton County ECA, joined CIPCO, CIPCO has remained the Cooperative’s wholesale power source, as well as Iowa’s largest cooperative energy provider. In 2009, more than 95% of CIPCO’s power was generated in Iowa, and over 40% came from carbon-free sources. Despite the recession, CIPCO has remained financially stable, and in 2009, it returned $189,813 to ECI in the form of a patronage payment from 1994 and 2009 margins. And ECI, too, continues to give back to its members. In 2009, ECI REC returned $500,000 in capital credits to its member-consumers.

Since the consolidation, ECI REC has continued to grow and improve. In the new millennium, ECI REC has implemented numerous community programs, charitable efforts, and energy-efficiency initiatives.

From 2003 to 2008, members donated almost $18,000 to help local low-income families pay for winter heating bills and home weatherization. The program, RECare, continues today. The Cooperative supports area youth as well, through donations and scholarships. In addition, every year ECI REC finds ways to contribute directly to the communities it serves. In an effort to redirect tourism back into small communities, ECI REC has assisted with the Buchanan County Barn Quilt Project by mounting wooden quilt designs on local barns. In 2007, ECI REC helped extract and move playground equipment from Vinton’s West and Lincoln school sites and relocated it to the elementary school’s new location in Tilford.

ECI REC also actively pursues green initiatives. Through its rebate program, members are encouraged to buy energy-efficient water heaters, heating and cooling systems, appliances, lighting, motors, and more. Since 2005, ECI has participated in the ENERGY STAR®: Change a Light, Change the World campaign, handing out thousands of energy-efficient compact fluorescent light bulbs. In 2007, ECI REC was a runner-up for Best Participation in ENERGY STAR among CIPCO cooperatives. The award criteria were based on participation in ENERGY STAR product and rebate promotions.

From two small groups of farmers to a Cooperative that serves over 6,700 member-consumers—commercial and residential as well as agricultural—East-Central Iowa REC has come a long way. Today, ECI REC employs nearly 40 people and has service areas in 11 counties (Benton, Buchanan, Fayette, Bremer, Black Hawk, Linn, Delaware, Clayton, Tama, Iowa, and Johnson). Some things haven’t changed, though: a commitment to local communities, a belief in the value of cooperative effort, and a dedication to bringing reliable electricity to member-consumers.