Should I be concerned ?

[Dbearman]

The Cooperative I work at is going into the third year of not making their TIER Level or minumum income level that is required by REA. Should I be concerned about my retirement and job security in general ? We cant buy anything or spend any funds on anything we dont absolutely need to have for our job. The CO-OP just put in for a pretty large rate increase to increase revenue but I am concerned about the financial picture of things. Should I be concerned enough to jump ship now or wait and see what happens ? What could REA do if the TIER level is still not up to requirements at the end of this third year ? Thank for any info , Bear

[loodvig]

Is another company trying to buy your co-op? Are they trying to make them selves look lean? If they get the rate increase it will also make them look better. Just a thought.

[wudwlkr]

If your retirement is through NRECA you don't need to worry about it. Even if your co-op were to go under the NRECA retirement system is funded by contributions from over 800 other co-ops. Because the Co-op retirement system is funded by so many sources, congress recently exempted them from having to meet the higher retirement funding requirments most large companies now have to meet. Probably one of the best traditional retirement systems still in place.

As far as job security goes, who's to say. I've known of several co-ops over the years that have gotten into financial difficulties and ended up in bankruptcy. Some have survived and some have not. Layoffs have always been part of the process though if for no other reason than to demonstrate that the company is doing "something" to prevent going under.

If co-op fails to meet financial requirments of RUS loans then RUS, like any bank or financial institution, can call the loans due. Worst case, they will oust management at the co-op and put their own management team in place. They in turn will do whatever they deem necessary to resolve the problem. From increasing rates, laying off staff, merging with another co-op, forcing bankruptcy or selling.