Flippin' the Switch
Flippin' the Switch
JOEMC Virtual Annual Meeting 2025
Each year, Jones-Onslow EMC holds its Annual Meeting of the Members on the last Friday in March. This meeting provides members with a robust review of the happenings at the cooperative in 2024, including achievements, future plans, and key initiatives for 2025.
This year, the Annual Meeting is virtual, making it more accessible than ever! Members can join from anywhere to stay informed and engaged with their cooperative. Plus, all registered participants will be entered for a chance to win one of 300 $50 Visa Gift Cards, and one lucky member will win $5,000 in cash!
Visit www.joemc.com/2025annualmeeting to view official documents and a full list of this year's prize winners!
Good morning and welcome to the 86th Annual Meeting of Jones-Onslow EMC. My name is Steve Goodson and, on behalf of the Board of Directors, ceo Gary Ray and the employees, I'd like to thank you for joining us today for our virtual annual meeting and business meeting. We've listened to you, the members, and you've indicated that, while you enjoy our in-person event last year, our virtual annual meeting will allow more flexibility and be more convenient. The members and you've indicated that, while you enjoy our in-person event last year, our virtual annual meeting will allow more flexibility and be more convenient, allowing many more members to watch and stay connected to their cooperative. So here we are, and while we won't get to enjoy each other's company in person this year, we hope you find the next few minutes informative as we conduct the business meeting portion of our annual event, where you will learn about the cooperative's activities from the previous year as well as our plans moving forward in the coming years.
Speaker 1:Before we start the business meeting, I'd like to begin with the Pledge of Allegiance, followed by the singing of our national anthem by co-op employee Veronica Miller. Derek Barbee, a crew foreman here at Jones-Onslow, will then lead us in the prayer. Let's get going. I pledge allegiance to the flag of the United States of America and to the republic for which it stands one nation under God, indivisible, with liberty and justice for all.
Speaker 2:O say, can you see by the dawn's early light what so proudly we hailed at the twilight's last gleaming, whose broad stripes and bright stars through the perilous fight o'er? The ramparts we watched were so gallantly streaming, and the rocket's red glare, the bombs bursting the night, that our flag was still there? Oh say, does that star-spangled banner yet wave O'er the land of the free and the home of the brave?
Speaker 3:Our dear Heavenly Father, we thank you for who you are. Lord, we thank you for being so great and so powerful in our lives. Lord, thank you for caring for us the way you do and loving us so well. Father, we just want to take this time and thank you for Jones-Onslow. Lord, we want to thank you for the great place that we have to come to work every day. Lord, we thank you for our leadership here. Thank you for our board of directors.
Speaker 3:Father, I pray you'll protect us all as we work every day here at Jones-Onslow. Lord, we thank you for this time we can spend together at our annual meeting. Lord. Lord, I pray that the decisions made here will ultimately glorify you. Father. Lord, we trust you in all things and, lord, we just love you and thank you for providing an opportunity for us to serve Such a great gift to be able to work here, lord. But you provided the ultimate gift through Jesus Christ, lord, and we thank you for that. Thank you for the sacrifice he made on our behalf, father, thank you for a relationship that we can have with you through him.
Speaker 3:Lord, again, thank you for this time. Lord. Also, we want to thank you for our consumers and for the role that they play here at Jones-Onslaug. We do not take that for granted, lord, we thank you, just Father, we thank you for today. Thank you for another day of life. And, just father, we thank you for the day. Thank you for another day of life. Well, we pray that um this meeting will be ultimately redeemed for your glory in jesus name, amen thank you, veronica and derrick.
Speaker 1:Before the business meeting is called to order, I'd like to take this opportunity to introduce your co-op board of directors. They are john pierce, chairman, representing Co-op Board of Directors. They are John Pierce, chairman, representing District 2. Thomas Waller, vice Chairman, representing District 3. Nelson Pete Burgess, secretary and Treasurer, member-at-large Cecil Hargett, douglas Parker and Dale Powell, representing District 1, brandon Howard and Iris Horn representing District 2, and Robert Doherty and Michael Chad Meadows representing District 3.
Speaker 4:Good morning.
Speaker 4:My name is John Pierce, chairman of the board of directors, and I'd like to call to order the 86th annual meeting of the members of the Jones-Ozlo EMC and confirm that we have a quorum of members registered for this annual meeting. Before we move into this business meeting of the co-op, I'd just like to say on behalf of the board not having a traditional get-together was a difficult decision. We'd love to Seeing everyone and we enjoyed the fellowship with the members of this outstanding organization. The board of directors has made a decision to conduct a business meeting in the virtual environment, in hopes the members could take the time at their convenience to watch this meeting and learn more about the co-op. Thank you for joining us and I hope you enjoyed the 2025 Annual Meeting of the Members. I will now turn this meeting over to Pete Burgess, our Secretary and Treasurer, who will present the 2025 Proof of Mailing and the Official Notice and the Treasurer of Jones-Onzalou Electric Membership Corporation, I am honored to present the results of our operations and discuss our financial conditions for the calendar year 2024.
Speaker 5:Prior to this meeting, all members should have received either a paper copy or a link to a digital copy of our annual report, which includes a copy of our financial statements for the year ending in December 31st 2024. The annual meeting minutes were posted on the annual meeting page on our website, and the approval of those minutes have been delegated to your board of directors. Your board of directors provides governance and oversight that includes ensuring that sound financial policies are in place. These policies are designed to ensure that your cooperative has the resources needed to pay all daily operating and fixed expenses. These policies also include setting financial targets that will provide adequate reserves to fund the construction of infrastructure required to meet both the current and future energy needs of the membership. For the year ending December 31st 2024, jones-onzalo's assets totaled $395 million. This was an increase of 4.5% over the assets in 2023. Jones-onzalo membership has continued to see strong growth. During 2024, your cooperative constructed over 2,400 new services. A decision to implement an adjustment to the base or facility charge of $10 per month went into effect in January of 2024. This decision was not taken lightly by your board and was implemented immediately, and it wasn't implemented until deemed necessary to maintain a healthy financial position for your cooperative. This adjustment, along with our continued growth and favorable weather conditions during 2024, resulted in operating revenues of $165.7 million. This was an increase of 8.6% over 2023.
Speaker 5:Cost of power, which is our largest expense, has experienced significant inflationary pressure. During 2024, our cost of power was $111.6 million. This is an increase of 9.3% over 2023. Our operations, maintenance and general expenses for 2024 were $29 million. Maintenance and general expenses for 2024 were $29 million. This was an increase of 2.7% over the previous year. Our fixed expenses, which include depreciation taxes and interest during 2024 were $23 million. This was an increase of 8.2% over the previous year. The increase in 2024 for fixed expenses can be attributed to the increase in interest rates. Additional depreciation expenses related to our growth. Total overall expenses, including cost of power, increased by 7.9 percent over 2023. This increase was driven by three factors that were mentioned previously Our increase in cost of power. The increase in interest rates and the increase in depreciation from the additional infrastructure required to accommodate the growth of the distribution system.
Speaker 5:Our operating margin, which is our revenue less expenses, commonly known as capital credits for 2024 were $1.5 million. Margins are necessary to have the cash flow required to operate our business and are contractually required by our financial lenders. You, as members of Jones-Onslow, generate the majority of these margins as you pay your electric service. These margins are often used in the normal course of business to build and upgrade the cooperative's electrical distribution system as financial conditions warrant. We return a portion of these margins to you, our members.
Speaker 5:In 2024, we returned over $1.8 million of capital to our membership in the form of a check or credit to the electric bill. I am pleased to report that the financial policies that Jones-Onslow has in place did the job and your cooperative remains a financially sound organization with the resources in place to deliver the safe, reliable and affordable electric services that you have been accustomed to. As a treasurer of this organization, I can assure you that the entire board of directors and management is dedicated to finding new and innovative ways to meet your current and future needs. At this time, I'd like to turn the podium over to our CEO, mr Gary Ray, for a few remarks.
Speaker 6:Welcome to our annual meeting. Jones-onslow annual meeting. We're glad to have you as members of our co-op. This is your meeting. Annual meeting of members.
Speaker 6:2024 was a great year. It was my first year, first full year as CEO. I came in late 2023, so we had a great year and I'll just hit on a few things to give you some information about your co-op. First, this wonderful organization. We have wonderful employees. We have a very strong board of directors and it all starts with our membership. Our board represents you as our members and our employees do everything we do to give you excellent service each and every day, and we had a great year in 2024 doing that.
Speaker 6:I'll touch on a few things. First, the pillars of our organization are always reliability and affordability. We do everything we can to keep our rates down. We also do everything we can to keep the power on. Those two things are very important to our members and, of course, we do both of those on a foundation of safety. Keeping our employees, keeping our public, keeping everyone safe with electricity is our main foundation that those pillars rest on. I'll also talk about two really important principles, cooperative principles that we stand on and we touched on in 2024. Those are cooperation among cooperatives and also concern for community.
Speaker 6:One big example of cooperation among cooperatives is when Hurricane Helene hit North Carolina in late September. It devastated the North Carolina mountains. We have cooperatives that serve members in those mountains and of course their power was totally devastated and totally off to most of those co-ops. We received a call to help French Broad EMC, a sister co-op serving about 42,000 meters, and every one of their meters was off at that time and we answered that call. We sent two groups of crews, 37 men total for over two weeks all the way across the state to help them and to restore power. And we do that because we do have a culture of cooperation with all the co-ops. There's 26 cooperatives in North Carolina and we do all we can to help each other and that was a great example of how we help those folks in their time of need. They've got the power on, of course, by now, but it was a major thing getting all that power back on and we were the first ones at that cooperative to help them in late September, early October. Another main cooperative principle that we touched in 2024 was concern for the community and we touched that one.
Speaker 6:Every year we have many programs here at Jones-Onslow EMC that touch the communities and the members that we serve. One is our Bright Ideas grants that go out to local educators. As you know, if you've ever been around a teacher, they don't have enough funds to do a lot of the projects they want to do to reach out to their students. We help with that. In 2024, we funded 97 projects benefiting 265 educators and touched 26,000 children in our local communities and our local schools. We do that every year. We've done it for 30 years and are glad to do that. It's a wonderful program. We also gave out scholarships to local young men and women. We also do a youth tour every year where we send a couple of our member junior senior age high school students to Washington DC to learn about Washington DC, learn about the government and also learn a lot about cooperatives. Washington DC, learn about the government and also learn a lot about cooperatives.
Speaker 6:Our local, our Jones-Onslow employees also volunteer their time in local projects. We had a couple of projects this year that our employees gave their time to help the community and Jones-Onslow and our employees are glad to do that. We are, our employees are part of the community that we serve. We're local and that gives us an advantage. We're coaches, volunteers, integral part of all the communities that we serve. We enjoy doing that and it gives us a part, our heart, to the communities. It also allows us, by being local, to give quick response times when we do have outages, and we do. No utility can go without outages, but our folks are local and get out into public and get those back on as soon as possible.
Speaker 6:One help is not losing power and we do that by improving our reliability on a yearly basis. This year we didn't build a new substation but we did work in substations. We did a lot of upgrades to our distribution lines that leave the substations, transmission lines that tie the substations together and tie them to Duke Energy. Large transmission lines are a major component of our system reliability. In 2024, we were awarded a Grid Resilience and Innovation Partnership grant from the federal government. That's a $42 million grant that'll come to Jones-Onslow eventually. We're in the negotiation phases right now. The federal part is the $42 million. Our part will have to chip in $14 million and what that will do, hopefully, is harden our transmission system that I just described Ties Duke Energy transmission lines to our substation is an integral part of our reliability. It will harden our transmission to a point that we feel like our reliability to our members will increase. Those lines are mainly located in Jones County and the Sneeds Ferry and Folkston area of Onslow County. We'll keep you posted on how those negotiations and how that project goes. It's a five-year project and we're really, really pleased that we were awarded that grant.
Speaker 6:Jones-onslow EMC is a fast-growing, busy cooperative. We hook up or connect about 2,500 meters each year. One of the fastest-growing cooperatives in the state each year. One of the fastest growing cooperatives in the state. We have about 85,000 meters right now and about 73,000 members. We average over 12,000 phone calls a month. We do, on an average, 3,400 disconnects and connects a month. Again, amazing amount of moving parts. Amazing amount of moving parts. An amazing amount of work that we do each month and annually to serve our members.
Speaker 6:On the financial side, I know our treasurer, pete Burgess, talked about this, but financials are very important. We had a strong year but it's challenging Expenses. All expenses in the co-op are rising. Our main expense over 60% of our total expenses is wholesale power costs. Wholesale power costs are are rising. It's an expense hard for us to control but we have to budget for it. And just to let you know, we're on stable ground. We were had very, very solid margins until the very end of the year and, because of power costs, we had a wholesale power cost adjustment from our power provider. That wiped out a lot of our margins, but we still had a solid year of over a million margins and we will return that back to the membership in the future. Margins are essentially revenues minus expenses. We need margins every year and margins at the co-op are turned into patronage capital or capital credits. As you if you've heard him mentioned, and also Mr Burgess talked about this in his treasurer's report Capital credits are very important.
Speaker 6:We use the capital from the members for years to upgrade our lines and make our system solid and give you great power and great service, and then over time we'll give those margins back in the form of capital credits. We're glad to say we do that every year. This particular year, beginning of 2025, we'll give those back in April. We'll give those back. We retired all of 2002's capital patronage 25% of 2024, for a total of about $1.9 million 25% of 2024 for a total of about $1.9 million. Again, that was mentioned earlier but I mention it because I'm trying to mention things that set the cooperative apart from other organizations. Other utilities, our folks being local is one, and then patronage capital going back to the membership, is another.
Speaker 6:Financially, we are at the end of a long rate cycle. We haven't done a total big upgrade in our rates in over 10 years and it's time we just are completing a cost-of-service study that takes into account all the expenses of the cooperative along with our expected revenues, and there will be a shortfall by the time we get into 2026. Therefore, I'm just letting you know that there's a good chance we'll have some rate changes, definitely increases, hopefully in the magnitude of about 5%, but we're still working on that, and we also implement some things like time of use rates and try to educate the membership on how important it is not only how much electricity you use, but when you use it. There are times of the day that it's cheaper for us to provide it, so we're going to make it cheaper for you to use it during parts of the day. Those are called time of use rates or TOU rates, and they'll be coming out with the next rate change hopefully by the end of this year.
Speaker 6:I'd like to wrap up by just saying thank you to all our members. Thank you for participating in our annual meeting. We do this for you, to give you some information about the cooperative and also conduct a business meeting. That we'll do just in a second. We have a wonderful membership, shows our appreciation to us daily on with emails and letters and contacting our folks about how good we're doing, and we love to just keep those comments coming. We love to hear the good comments from the members.
Speaker 6:This organization is a wonderful organization. We've got excellent and knowledge and caring employees. We got the best employees employees We've got the best employees. We've got top-notch staff and management with valuable energy industry experience so valuable in these days of uncertain industry times. We've got a great board of directors and that's what you'll do in part of the business meeting is re-elect directors. They're very knowledgeable and trained. They know about the cooperative, they know about our industry and they represent our membership so well. They have your interest and the cooperative's interest at heart each and every time we go into board meeting.
Speaker 6:I'll close by using a quote from the legendary NFL coach, vince Lombardi. It says perfection is not attainable, but if we chase perfection we can catch excellence, and I'll lead this team our team in the pursuit of perfection, because I know we catch excellence. We do excellence each and every day. Excellent service to our members that's our goal, that's our mission and that's what we strive to do. I'm Gary Ray. It's a pleasure to be your CEO and I'm glad to be here. It's my pleasure to introduce now Jones-Onslow's General Counsel, bob Warlick, of the Law Offices of John Drew Warlick, to conduct the remainder of the business meeting.
Speaker 7:The next order of business is the election of directors. A member can have his or her name placed in nomination for a seat on the board of directors, either through the nominating committee or by submitting a petition with at least one half of one percent of the cooperative membership, of one percent of the cooperative membership, and the petition has to be submitted to the cooperative headquarters at least 35 days prior to today's annual meeting. The nominating committee met on February 20, 2025 and unanimously nominated the following individuals District 1, mr Douglas Parker. District 2, mr John Pierce. District 3, mr Robert Daugherty and at large, mr Nelson Burgess. With there being no nominations by petition, I hereby certify the election of Directors Doug Parker, for District 1,. John Pierce, for District 2,. Robert Daugherty, for District 3, and Nelson Burgess, at large, pursuant to Section 4.03 of the Cooperative's Bylaws. There being no further business to come before the board meeting today, I hereby declare the business meeting adjourned. Thank you.
Speaker 1:This concludes the 2025 Jones-Onslow Annual Meeting. Thank you for joining us this morning online. Have a great rest of the day and a wonderful weekend.
Speaker 7:For a full list of prize winners from this year's Annual Meeting, please visit wwwjoemccom. Backslash 2025 Annual Meeting.