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									                            Rio Grande Electric Cooperative, Inc.

                            UP DATE                                                                                Happy

                                                                                                              February, 2004

                            A Message From The General Manager/CEO
                                                    By Daniel G. Laws
By now I imagine you have seen the announcement that Rio Grande will be raising rates, and that the increase will become
effective on your March 5 bill. Although you may have seen the notice, it may not have sunk in yet. As you consider the
decision to raise rates, I want you to be as informed as possible, so that you can be satisfied that it is the right thing to do.

I have just completed fourteen years as General Manager/CEO of Rio Grande ECI, making me the second-longest tenured
general manager in the history of the Cooperative. During that time, I can say without a doubt, the single most difficult issue
I have dealt with is our rates. I don’t really know how so many incorrect ideas about how and why our rates are what they are
came to be so widely accepted. Chief among the wrong notions is the idea that the Cooperative makes money hand over fist
to the detriment of its members.

Working hand in hand with this mistaken notion is the idea that our rates are the highest in the state or nation. In fact, that is
so commonly believed that I know of real estate agents who will actually steer potential homeowners away from homes
served by the Cooperative. Our residential rate class is higher, at times, than other electric utilities in the area, but they are
not the highest in the state or nation. Other rate classes are often lower than competitors, as evidenced by the competition
for the Eagle Pass High School. We were the lowest cost alternative and were chosen to provide electric energy to the High

As a matter of policy, Rio Grande ECI does not allow cross-subsidization between rate classes. In other words, we don’t
charge one class of consumer more so that we can reduce rates to another. Although Rio Grande doesn’t subscribe to this
practice, it is common to the electric utility industry and is precisely why some electric energy providers are able to offer
lower residential rates.

Our rates are cost-based and aimed at having each class support the expenses associated with providing electric energy and
services to that class. Simply stated, we keep our accounting records in such a way as to allocate costs by rate class, e.g.
the residential class. We then take those expenses and divide them by the kWhs sold to the class we are working with, and
arrive at the appropriate rate. At the end of the day, what each residential consumer pays is what it costs to deliver the energy
consumed and provide a reasonable margin. Needless to say, the same can be said of each rate class.

So you’re wondering, “If all that is true, why are Rio Grande’s rates higher than anyone else’s?” It is simply the economy of
scale. We have one meter from which to collect revenue for every constructed mile of line. Typical investor-owned electric
utilities have 30 meters and cities have 50 meters. An appropriate analogy would be a car pool. If you purchased a car to
commute to work, the monthly cost to operate the car would be one hundred percent yours. However, if another person joined
your car pool, the expenses would be half, and if four joined, your expenses would be a fourth of the total expense. In Rio
Grande’s system, one way to look at what happens is each meter pays the full cost associated with one mile of line.

So, why is the energy component of each rate being raised five percent? Because everything we purchase has gone up
significantly in the sixteen years since our last increase. Minimum wage has increased 54%, fuel for vehicles has increased
27%, employee health care has more than doubled; to list but a few. We have held the line on rates for sixteen years and
have eliminated inefficiencies while improving service. Continuing to bring new technology to our service area, and improved
reliability requires that we raise rates.

Please don’t get the wrong impression; the Cooperative is not in bad financial condition, but it would soon get to that point
without a rate increase. This increase will allow us to maintain and improve our capital management financial goals, so that
Rio Grande ECI will always be here to provide reliable electric energy to the most rugged and diverse service territory in
Texas. I know that is something you want, and it goes to the heart of what makes Rio Grande Your Home Team Advantage.
Rio Grande Electric Co-op                                                                                                       8
             You Asked For It. . . You Got It!
         RGEC’s Offices Are Now Open During The Lunch Hour,
                        For Your Convenience.
                                            Member Services Available:
          Facsimilies                                    Turtle Meters                         E-Billing (Online)
     Use of Copy Machines                               Security Lights                       Credit Card Payments
     RioNet Internet Service                          Pre-Paid Metering                     Budget (Equalized) Billing
    Co-op Power Credit Card                           Free Energy Audits                  Automatic Bank Draft Payments
Discount Rates at La Quinta Inns                     In-house Electrician

Steven’s Chocolate Cake                         Jackie Braden Midkiff, Texas                   We Goofed!
Mix together:
2 c. sugar          2 tsp. baking soda
2 c. flour          1/4 tsp. salt
1/2 c. cocoa
                                                                                               Just as with cooking, things don’t
2 eggs              1 c. oil
                                                                                               always turn out the way you planned!
1 c. buttermilk (or 1 c. milk + 1 tsp. vinegar)
                                                                                               When submitting recipes for the Co-
Beat until smooth, then add 1 cup hot water and 1 teaspoon vanilla and beat untill
                                                                                               op Cookin’ cookbook, we inadvert-
smooth. Mixture will be thin and runny. Bake in Bundt pan 35 to 40 minutes at 350
                                                                                               ently missed those submitted by
degrees. Cake is very moist - icing or glaze is optional. It is very good without any icing
                                                                                               Jackie Braden of Midkiff, Texas. We
on it.
                                                                                               also misspelled the name of a
                                                                                               director’s wife, and one of our own
The Pantry’s Chocolate Chip Pie                Jackie Braden Midkiff, Texas
                                                                                               employees. So you can see we cer-
2 eggs                      1 1/2 tsp. vanilla
                                                                                               tainly don’t discriminate!
1/2 c. melted margarine     1 c. semi-sweet chocolate chips
1 c. granulated sugar       1 c. pecan pieces
                                                                                               Some of our Rio Grande cooks sub-
1/2 c. flour                1 (10 inch) pie shell
                                                                                               mitted recipes after the order had al-
Mix eggs, margarine, sugar, flour, and vanilla together. Stir in chocolate chips and pecan
                                                                                               ready been sent to the publisher. If
pieces. Pour into 10 inch pie shell. Bake at 350 degrees for 55 minutes to 1 hour. Serve
                                                                                               we missed your recipes this time
with whipped topping or vanilla ice cream. Wonderful! Never stir chocolate chips into
                                                                                               around, be sure to send them in early
warm melted margarine. They will melt and you will have a completely different pie! This
                                                                                               if we do another cookbook. We, un-
recipe is from “The Pantry Cookbook.” The Pantry is an old-fashioned restaurant in
                                                                                               fortunately, could not publish all of
McKinney, Texas.
                                                                                               the recipes submitted. Some were
                                                                                               not legible, and others were dupli-
Quick Fruit Cobbler                              Jackie Braden Midkiff, Texas
                                                                                               cates of recipes previously submit-
1/3 c. butter or margarine             3/4 c. milk
                                                                                               ted, etc.
3/4 c. sugar                           1/2 tsp. vanilla
1 c. flour 1 pkg. frozen fruit, thawed OR 29 oz. can sliced peaches & juice
                                                                                               Compiling the cookbook was a very
2 tsp. baking powder                   1/4 tsp. salt
                                                                                               arduous and time consuming task
1/4 c. sugar
                                                                                               when added to the regular work load,
Preheat oven to 325 degrees. Melt butter or margarine in a 9x12 inch pan. In a mixing
                                                                                               but we did our best, and hope that
bowl, combine 3/4 cup sugar, the flour, baking powder, salt, vanilla, and milk and pour
                                                                                               you are all enjoying Co-op Cookin’.
this over the melted butter or margarine, but do not stir. Pour fruit and any juice over the
flour mixture - do not stir. Sprinkle 1/4 cup sugar over the fruit. Bake until done, a light
golden brown, about 45 minutes.                            RGEC Co-op Cookin’ February ‘04
               Retro Factoids                                   320 More Will Use RGEC Power!
Lots of things have changed since Rio Grande’s
last rate increase way back in 1987. We thought it
might be fun to take a walk down memory lane and
remember “the good old days”.

Item                    1987 Prices   2003 Prices     % +/-
Bread                   $0.55/loaf    $1.89/loaf     +243%
Milk                    $1.98/gal.    $2.89/gal.     + 46%
Eggs                    $1.03/doz.    $1.89/doz.     + 83%
Gas                     $0.96/ga.     $1.49/gal.     + 55%
Stamp                   $0.22         $0.34          + 55%
Water                   Free!         $1.00/bottle   +100%
Min. Wage               $3.35/hr.     $5.15/hr.      + 54%

                                                                While they are not exactly considered members,
Other Interesting “Then & Now” Information:                     about 320 additional Kinney County residents will
                                                                soon be using RGEC power. Construction on the
Tiger Woods entered 6th grade in 1987. In 2003, he was ranked
as the world’s best golfer, and made $70 million from appear-
                                                                new Kinney County Detention Center near
ance fees and endorsements, including deals with Nike, Ameri-   RGEC’s headquarters is progressing ahead of
can Express and EA Sports. On the course, he made the cut       schedule, according to a recent news report in The
in 104 straight tournaments.                                    Brackett News. The new facility, which will house
                                                                federal inmates, is situated on 60 acres within the
The antidepressant Prozac was introduced in 1987. Today it
is the most widely prescribed medication of its kind in his-
                                                                Co-op’s service territory. A projected completion
tory. Prozac has helped over 40 million patients worldwide.     date has not yet been made available.

Ronald Reagan was President in 1987 and George Bush was                    Informational Meetings
Vice President. Today, Reagan struggles with Alzheimer’s
disease and George’s little boy, “George W.” is President.                    On Rate Increase
October 19, 1987, known as Black Monday, is the day U.S.
                                                                  February 3, 7:00 P.M.
stock market prices plunged to close at a record-breaking
low. The 2003 market closed at a three-year high.                 Carrizo Springs Civic Center, 405 N. 7th St.
                                                                  Carrizo Springs, TX
After signing a contract with the San Antonio Spurs on No-
vember 6, 1987, Naval Academy graduate David Robinson             February 5, 7:00 P.M.
headed off to fulfill his two-year commitment to the Navy. In
                                                                  Rio Grande Electric Co-op Warehouse
2003, Robinson retired from the game, having accomplished
two NBA Championships, 10 All-Star appearances, two Olym-         Hwy. 90 & SH 131, Brackettville, TX
pic gold medals, and a spot as one of the 50 greatest players
in NBA history. The NBA’s community service award now             February 10, 7:00 P.M.
bears his name, and he was named Sports Illustrated’s 50th        Alpine Community Center,402 E. Gallego St.
Anniversary Ambassador of Sports, and co-Sportsman of the
                                                                  Alpine, TX
Year, along with teammate Tim Duncan.

In 1987, Cheers, was the #3 TV show. Throughout it’s run, it      February 11, 12:00 Noon
received 26 Emmy Awards. Today, in reruns, it enjoys a large      Dell City Community Building, West Orange
following of fans, and sparked the popular spin off show,         Street, Dell City, TX
Frasier. Kelsey Grammer in his Emmy Award-winning title
role of Dr. Frasier Crane, made history by becoming the first
series, comedy or drama, to achieve a record five consecu-        February 12, 7:00 P.M.
tive Emmy wins for Outstanding Comedy Series. With this           Fort Stockton Club Room, Rooney Park,
achievement, the series stands ahead of the four-time win-        off Sanderson Hwy. 285, Fort Stockton, TX
ners -- including Cheers. Now in its 11th season, “Frasier”
has earned a record total of 31 Emmy Awards.
Rio Grande Electric Co-op                                                                                         8
                                                           You Have A Name. . .
Member Involvement Survey

     Returning A Completed Member
      Involvement Survey Will Win
         One Lucky Member A                                  Your Own Identity.
       $100 RGEC Account Credit!

The member involvement survey is your chance             We realize that even though your spouse or partner’s
to tell us if you would be interested in taking an       name may be the one on your Co-op account, you have
active role in the leadership of the Co-op. Those        your own identity, and are an equal partner.
interested in serving on the board of directors, nomi-
nating committees, and member advisory commit-           At Rio Grande Electric Co-op, it’s easy to change your
tees have a chance to do so at this time. Even           membership to a “joint” account, and there is no charge
                                                         for this service. A joint membership makes either mem-
those who do not have time to serve the Coopera-
                                                         ber eligible for annual meeting prizes, board positions,
tive are eligible for the $100 account credit draw-      and helps to establish credit for both. Call or stop by
ing, by completing and returning the survey.             your nearest RGEC 301775800 office today, to change
                                                         to a joint account.
Money, Money, Money!
Don’t forget to look for your account number hid-
den within the pages of this month’s edition. Each            RioNet Moves To RGEC Office
month, two account numbers are hidden some-
where within the RGEC section of this magazine.
Find your account number, call the Co-op, and             In an effort to control costs, RioNet Internet
claim your $10 Account Credit!                             Service has been relocated to Rio Grande
                                                           ECI’s Headquarters office in Brackettville.
                    Coloring Contest
                                                             Although the Uvalde office closed on
                        Winners                             January 12, we will continue to offer the
                                                          same customer service we have in the past.
                 Winners in the “Kids Light Up The
                 Holidays” Coloring Contest were:             If you have questions regarding your
6 yrs. & Under -- Joli Carpenter, Ft. Stockton, TX;                RioNet bill, please call us at
Aylin Rodriguez, Uvalde, TX; and Antonio                                 1-800-749-1509.
Ramirez, Del Rio, TX. 7 -10 year old Division -
Mary Casarez, Del Rio, TX; and Apryl Stuart, Big            If you have a technical support question
Bend, TX. Each receives a Wal-Mart Gift Card.               relating to dial-up, please call the toll free
                                                                     number 1-888-256-0449.
           Check us out on the web at

      Computer System Is Prize
         In Essay Contest
Eligible students ages 14-18 could win a brand new computer sys-
tem, if selected as the winning entrant in the 2004 RGEC Essay

To be eligible to enter, a student’s parent or legal guardian must
be a bona fide member in good standing of Rio Grande Electric

Students must submit an original 500 word or more essay entitled
“Why Co-ops Are Special”.

Please pay particular attention to the rules listed below. Partici-    2003 Essay Contest winner,
pants who do not follow the rules outlined below will be disquali-     Carmen Gaddis, of Big Bend
fied from competition.                                                 High School, read her winning
                                                                       entry at RGEC’s 58th Annual
Rules: The upper right hand corner of the essay must contain the       Meeting.
member’s name (parent or legal guardian), address, and telephone
number as it appears on their Rio Grande Electric Co-op bill, as well as the student’s name, age, and
name of the school the student currently attends. References to family names, specific locations, or
any information that might reveal the identity of the writer must NOT be included in the body of the
essay. Entries must be submitted to Rio Grande Electric Cooperative, Inc., P.O. Box 1509, Brackettville,
TX 78832, in a sealed envelope, clearly marked “ESSAY CONTEST”. Entries must be received by
April 30, 2004.

Judging: The Board of Directors will judge submitted essays and select the contest winner(s) and a
runner up, in the event the winner should be found ineligible for any reason. Judging of essays shall be
performed in accordance with the following guidelines: Each essay, upon receipt, shall receive a con-
trol number which shall be printed in large numbers on each page submitted. A log shall be main-
tained listing the control number, youth’s name, and the date the essay was received. Essays shall be
copied, blanking out all information contained in the upper right hand corner, so that Directors only
know the writers by the control number assigned to the essay. These copies shall then be given to
Directors during the board meeting immediately following the contest entry deadline. The winner shall
be determined by a majority vote of the Board members present at the meeting. Following the Board’s
selection by vote, the General Manager/CEO shall announce the name of the contest winner(s) and
runner(s) up. The winner(s) will be notified as soon as practical, and press releases will be sent to area

Additional Information: Cooperative information packets are available from any RGEC area office, or
by calling 1-800-749-1509. Applicants may find this information helpful in obtaining information about
the Cooperative Business Model. Additional resource material may be found online at the following
sites:;;;, as well as
many other sites. Contestants are reminded that judges will be familiar with the information contained
on these sites, and plagiarism could result in disqualification.
          Life Support Registry Update
In order for RGEC to better serve your
needs, if you or a family member rely on
any form of life support, you should:
                                                      Help Us Help You!
„Fill out the form below.                            "
                                                             (CLIP & KEEP BY THE PHONE)
„Update the form every six months, or if
 your medical needs change.                                RIO GRANDE ELECTRIC CO-OP
                                                               EMERGENCY NUMBER
„Obtain backup equipment such as gen-
                                                       Our phones are answered 24-hours a day,
  erators or batteries.                                7 days a week, by “real people”. If you have
                                                       an emergency, please call!
„Notify us immediately when an outage oc-
 curs and tell the dispatcher that you are
 a “critical need member”.                               1-800-749-1509
                                                         Say, “I AM A CRITICAL NEED MEMBER”
„Make sure you have a phone that does
 not rely on electricity to operate.
                                                       My Account #:_____________________
„Keep your account number, meter num-
 ber, and Rio Grande ECI’s phone num-                  My Meter #:_______________________
 ber by the phone.


Name:_______________________________________________________ Date: ____________


Telephone Number(s): __________________________________Is this a change/new #? Y                 N

Special Equipment:______________________________________________________________

Check (þ) all that apply: Do you have a stand-by generator?          Battery backup?
                                                                     Battery Life # hrs:_________

Please return the completed form to your area RGEC office, or mail it to Rio Grande ECI, Attn. Cathy
Kelly, P.O. Box 1509, Brackettville, TX 78832. Thank you.
Rio Grande Electric Cooperative’s Linemen,
Area Office Clerk, and Area Operations Man-
ager read a special Christmas story to approxi-
mately 65 pre-kinder, kinder, and second grade
students at Jones Elementary in Brackettville.
Each of the kids thanked the readers with a
great big hug, and school administrators have
asked for “A Co-op Christmas” to become an
annual event.

The adults enjoyed the event, too. “Now I feel
Christmassy!” said Severo Martinez, one of
the Co-op’s 1st Class Linemen. “I used to read
to my kids all the time when they were little, Rio Grande Electric Co-op employees Danny Samaniego, Brackettville Area
but reading aloud takes practice. I’m glad we Operations Manager; Ronnie Mata, 1st Class Lineman; Gilbert Villarreal, 2nd
did this,” he said.                               Class Lineman; Jaime Muniz, 2nd Class Lineman; Rene Diaz, Area Office
                                                  Clerk; Severo Martinez, 1st Class Lineman; and Daniel Garza, Apprentice
The Co-op is going to expand the program to Lineman read “Olive, The Orphan Reindeer” to students at Jones Elemen-
include schools throughout its service territory, tary.
and is also planning something for Valentine’s
Day!                                              An article on the program appeared in CFC Solutions, an industry publica-
                                                  tion, which highlights innovative practices within cooperatives.

                       Old Photos Wanted!

Do you have an interesting old photograph that relates to elec-
tricity, or the history of Rio Grande Electric Co-op?

If so, share it with your fellow Co-op Members! Mail to P.O. Box
1509, Brackettville, TX, or e-mail to

For more information, call Cindy Edwards, Communications Coor-
dinator at 1-800-749-1509.
                                                 BOARD ACTION
                            Summary of Board Meeting Minutes
                                December 17, 2003
                                                                                                   BOARD OF
A Meeting of Rio Grande Electric Cooperative, Inc.’s Board of Directors was
called to order at the Headquarters office in Kinney County, Texas, at 8:02 a.m.,
December 17, 2003. The following Directors were present for the meeting: Hugh
                                                                                                *Chris Lacy, President          District 7
Childress, Bill Cowden, Art Gonzalez, Larry Jones, Chris Lacy, Robert Layton,                   P.O. Box 918
John Ralston, James Runyan, Jack Skiles, Kenneth Sparks, Howard Wakefield,                      Fort Davis, TX 79734 432-426-3380
and Lowell Woodward. Also present for the meeting were General Manager/
                                                                                                *Robert Layton, Vice-President District 9
CEO Daniel G. Laws and Executive Assistant to GM/CEO Martha Gerardo.                            P.O. Box 157
                                                                                                Dell City, TX 79837
Approved                     November 19, 2003 Board Minutes                                    505-963-2604 (H)

Heard                        Financial Reports                                                  *Lowell Woodward, Secretary    District 8
Heard                        2004 Budget Presentation (Shawn Stanley, Manager of Ac-            P.O. Box 1327
                                                                                                Alpine, TX 79830-3320 432-837-7308
                             counting & Finance)
Approved                     2003 Write-offs as Presented                                       *Hugh Childress, Treasurer      District 6
Approved                     Member’s Request for Deposit Refund, in accordance with            P.O. Box 943
                                                                                                Ozona, TX 76943     325-650-6125
                             approved Tariff
Denied                       Member’s Request to Condemn Neighbor’s Land for                    *W.H. Cowden, Director              District 6
                             Easement                                                           P.O. Box 3006
                                                                                                Kent, TX 79855 432-259-3133
Approved                     Board Member Martha Clay Manning’s, Director District 4,
                             Resignation and to Fill Seat during 2004 Election for              *Art Gonzalez, Director        District 7
                                                                                                P.O. Box 306
                             Remainder of Term                                                  Dell City, TX 79837 915-964-2814
Approved                     Resolution Authorizing Construction of the Rosita Creek
                             Substation                                                         Larry W. Jones, Director       District 9
                                                                                                8587 Fm 2691
Approved                     5% Increase to the Energy Component of each Rate Class             Carrizo Springs, TX 78834 830-374-9691 (W)
Heard                        General Manager/CEO Report
Heard                        Committee Reports                                                  *John F. Ralston, Director          District 1
                                                                                                P.O. Box 25
Approved                     General Manager/CEO & Director Expenses                            Carrizo Springs, TX 78834    830-876-3441
Approved                     October New/Revoked Memberships
                                                                                                *James S. Runyan, Director     District 4A
Reviewed                     Check Register and Arrears Report                                  P.O. Box 420962
Adjourned                    2:18 p.m.                                                          Del Rio, TX 78842 830-775-3401

                    TREES ARE NATURAL                                                           *Jack Skiles, Director         District 5
                                                                                                P.O. Box 164
                      ENERGY SAVERS                                                             Langtry, TX 78871 432-291-3270

  Now is the time to plant trees, while they are still in their                                 *Kenneth Sparks, Director     District 3
  dormant state. The Department of Energy says, “Care-                                          HCR 77, Box 442
                                                                                                Uvalde, TX 78801 830-278-6587
  fully positioned trees can save up to 25% off a typical
  household’s energy for heating and cooling.”                                                  *Howard B. Wakefield, Sr., Director District 3A
                                                                                                P.O. Box 1237
  Deciduous trees, (those which drop their leaves in winter), planted on                        Brackettville, TX 78832 830-563-2989
  the west side of your house will help you stay cool in the summer and                         Daniel G. Laws, General Manager/CEO
  allow sun to shine in the windows in the winter.                                              P.O. Box 240
                                                                                                Brackettville, TX 78832 830-563-2444 (W)
  Orientation of the house and surrounding landscaping has a large effect
                                                                                                * Certified Credentialed Director
  on energy consumption. A well-oriented, well-designed home admits
  low-angle winter sun to reduce heating bills; rejects overhead summer
  sun to reduce cooling bills; and minimizes the chill effect of winter winds.
  For more information, visit

Rio Grande Electric Co-op                                                                                                                         8

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