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President’sReport


The year 2012 marks the 74th anniversary of Harmon Electric Association. Your annual meeting will be held on Friday, April 6, 2012 at the Hollis Civic Center in Hollis, OK. Your board


of trustees and management encourage you to attend and take an active part in your association.


Financially, 2011 was another good year for Harmon Electric. We generated $561,103 in margins. We also met all RUS requirements and ratios in 2011.


Due to the extreme heat of the summer and drought conditions all year, kWh sales were up overall by 15%. This was a major contributing factor in the positive margins. This is pretty remarkable considering that the rebuilding process from the ice storm continued throughout 2011. In the next few months the first phase of the rebuild should be complete. The final phase is getting underway and will continue for the next several years.


Although the management and employees of your cooperative continue to take every measure to keep expenses down, all the FEMA work being done has increased expenses. Having the additional expense of contractors all year has increased our Operations and Maintenance expense by 22%. We anticipate O&M expenses to remain elevated until we are able to complete all the repair work.


On the positive side, Harmon Electric’s total plant value increased by 17%, going from a value of $23.5 million in 2010 to $27.6 million in 2011. Also, our long term debt decreased by $362,388 or 2%. Your cooperative continues to grow at a manageable rate. In 2011 we added an additional 76 services with the majority of those being irrigation accounts. This has added significant kWh sales without adding to our demand costs. The additional load without additional expense for demand costs helps keep everyone’s rates from going up. Because of the upcoming expenses for continued repairs, your board of trustees has decided not to pay any capital credits at this year’s annual meeting on the 1982 rotation. Patronage capital for 2011 will be allocated to your account for the margins of 2011.


Your board of trustees is committed to making the rotation of consumers’ capital credits a priority. When financially possible, Harmon Electric will once again be paying back capital credits. This is just one thing that makes cooperatives different from other business models. Our goal continues to be providing safe, reliable electricity at an affordable cost while maintaining excellent service.


We realize that you, the member are the reason for our existence. We urge you to attend your annual meeting on Friday, April 6, 2012 and take an active role in your cooperative.


Manager’s Report


I present to you Harmon Electric


Association’s 2011 Annual Report. This report contains the current status of your cooperative. You the member are part owner, so please take an active part and plan to attend the Annual Meeting.


I am truly blessed to be part of such a wonderful organization.


You have an excellent board of trustees representing seven districts. Each trustee is dedicated and looks out for your best interests because they are members as well. They work hard to stay informed and keep up with the industry changes. We also have some of the most dedicated employees. They love their jobs and enjoy serving you. We currently have 20 employees with a total of over 386 years of experience. It’s very rewarding to be able to lead such a dedicated group of employees through the challenges we face. They encourage me with their passion and enthusiasm and this makes my job very rewarding. I have been told multiple times how friendly and helpful our


staff is. Some of these individuals visit other cooperatives around the state and have shared with me that Harmon Electric is their favorite cooperative.


Being a small cooperative has some advantages. One of those advantages is making sure that every member is treated like they are our number one priority. I believe our exceptional customer service is what sets us apart from other organizations. I was also reminded recently how important our mission has been and continues to be in providing you with safe, reliable electricity at an affordable cost. Mrs. Wilcey Rippetoe brought her grandparent’s Harmon


Electric Share Certifi cate dated 1940 into the offi ce. Along with the certifi cate, she also had the invitation to attend Harmon Electric’s 1940 annual meeting. A few months ago I also received an email from the granddaughter of a member who hasn’t lived in the Hollis area since 1957. They were going through her grandparents valuable papers and found a Harmon Electric Share Certifi cate dated 1947. The granddaughter was inquiring about the certifi cate and wondering if they had any rights by being a shareholder. Both of these instances were a reminder to me how important Harmon Electric has been and continues to be to Southwest Oklahoma and North Texas. In both instances, the Share Certifi cates were saved because receiving electricity was a life changing experience. We take it for granted today and just expect it to be there when we need it. There aren’t too many members left that remember when


Harmon Electric brought electricity to their homes and farms. To those that do remember, they can tell you how it changed their lives.


Our goal is to continue that rich tradition by making a


difference in member’s lives. We strive to treat each member as though they are our number one priority, because they truly are. Make plans to join us on Friday, April 6, 2012. We look forward to seeing you.


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