Southwest Tennessee Electric Membership Corporation is a consumer-owned, nonprofit electric distribution cooperative, providing electric service to parts of Chester, Crockett, Fayette, Hardeman, Haywood, Henderson, Madison and Tipton Counties. Of the twenty-two electric cooperatives in Tennessee, Southwest, with over 48,000 consumers and approximately 3,600 miles of line, ranks sixth with respect to number of customers and seventh with respect to miles of line. Southwest is the largest electric cooperative in West Tennessee.
What are cooperatives?
During the early 1930′s, electric service in rural areas virtually was nonexistent. Private power companies either refused to provide service in rural areas, or they required rural families to pay for the cost of line construction to the individual farm in addition to the monthly electric bill, and in some cases, required the farmers to guarantee a large monthly power bill. The prevailing attitude on the part of private power companies was that rural people didn’t need electricity.
In 1936, Congress passed the Rural Electrification Act, which was intended to provide low cost loans to private power companies for the purpose of constructing electric line in rural areas. However, the power companies still were not interested in rural electrification and declined to take advantage of low cost REA loans. It was at this time that rural people began to organize electric cooperatives, borrow money from the Rural Electrification Administration and provide themselves with power.
A cooperative is a business financed, owned and controlled by the people who use it. Cooperatives are made up of citizens with similar needs, goals and problems. By working together, they combine their investments and influence to accomplish much more than any one person in the group could accomplish alone. Cooperation gives a group financial strength, greater independence and a stronger voice in their own business affairs. Cooperatives stimulate free enterprise while helping to protect the individuals involved. About 45,000 cooperative organizations are in business today in the U.S., with more than 9 million members.
About 5,000 co-ops are farmer-owned and provide marketing, purchasing and related services for farmers and producers. Cooperatives market about 25 percent of all agricultural products and provide about 25 percent of all production supplies used on American farms each year. Forty million rural people and their businesses get their electricity from more than 900 million electric cooperatives and their telephone service from about 250 telephone cooperatives. Dairy producers have organized about 1,100 cooperative dairy herd improvement associations, 30 percent of all irrigated farmland is supplied water by cooperative irrigation associations. More than 1,000 farmers and mutual fire insurance associations carry fire and insurance coverage on farm buildings in the U.S. Sound credit is extended to agricultural cooperatives and to farmers to help finance land, crops, livestock and equipment though cooperative banks. Additionally, about 1,000 rural credit unions chartered under federal and state statutes provide savings and loan services to many thousands of their members.
Co-ops matter because they mirror the very best of the American Way.
Co-ops are a true democracy where membership is voluntary and members have democratic control, with each member having one vote. They operate not for profit, but at cost to the benefit of their members. They are not in business to make money for their investors or owners; they exist to meet the needs of their members for products and services, as economically as possible. Excess funds are returned to members in what is called a patronage fund, or re-invested in the cooperative to purchase new equipment, construct new buildings or acquire property as needed.
Cooperatives are a Tennessee Tradition
Some of the first cooperatives in the U.S. sprang up in Tennessee. Cooperatives began taking root in the U.S. in the 1920’s, but in 1935, President Franklin Roosevelt’s Rural Electrification Administration changed the course of Tennessee history, and power truly came to the people of Tennessee through electric cooperatives. Today, rural electric cooperatives still deliver power to more than three-quarters of all the state’s land area.
Cooperatives May Be the Key to the Future for Many Tennessee Businesses
Americans face new challenges. To be a farmer or small businessman in today’s economic and political climate takes large amounts of capitol, polished managerial skills, high levels of information and resources and cooperation. Through the formation of and participation in new co-ops, the American people may once again find the power in themselves through a new generation of co-ops to provide for themselves, maintain or improve their lifestyles, produce products, create, secure or expand their markets and contribute to the economic well being of their states and country.
The Tennessee Council of Cooperatives
The Tennessee Council of Cooperatives (TCC) is a non-profit organization established to promote “the cooperative way of business” through education and promotion of all types of cooperatives.
The council is made up of member representatives from various cooperative organizations in Tennessee. The TCC has two types/levels of membership including, parent cooperatives, and individual cooperatives. The 2002 total TCC membership is 60 members consisting of eight parent cooperatives and 52 individual cooperatives. The total TCC membership can be further segmented as 19 electric cooperatives, 29 Tennessee Farmer Co-ops, 5 telephone cooperatives, 3 financial institutions, 2 milk cooperatives, 1 tobacco cooperative and the Tennessee Farm Bureau. 13 voting board members and 6 ex-officio members provide the leadership for TCC.
The TCC functions as the state’s flagship organization for coordinating, promoting, educating and extending cooperative development in Tennessee.
The TCC often serves as a clearinghouse for the open exchange of information and experiences among cooperative businesses, as a sounding board for new ideas and a forum for discovery, discussion and dissemination. The TCC is also positioned to be a springboard for initiating and implementing plans and programs relevant to cooperatives. The TCC sponsors five college scholarships for agricultural students at each of Tennessee’s four-year agriculture programs. The TCC also hosts an annual leadership conference with emphasis on cooperatives for approximately 35 young leaders across the state. The TCC also provides leadership, cooperation and support to various other programs, seminars and conferences.