DOUGLAS COUNTY — Douglas Electric Cooperative can now accept FEMA dollars to cover repair costs from the February storm.
On Friday, Dec. 19, the U.S. Senate passed the Revitalizing Underdeveloped Rural Areas and Lands Act. This act will amend the 2017 tax code that had the unintended consequence of limiting relief funds to places hit by natural disasters across the country, including economically depressed areas of Douglas County still recovering from a storm that turned out the lights for weeks on end. Now DEC can receive any FEMA funds without losing its not-for-profit status.
According to the America’s Electric Cooperatives webpage, “(National Rural Electric Cooperative Association) and its members successfully lobbied Congress to pass the RURAL Act in late 2019 to preserve co-ops’ tax-exempt status.”
It explained how cooperatives were threatened to lose tax-exempt status due to the 2017 Tax Cuts and Jobs Act passed by Congress, treating government grants as taxable income if received by a co-op.
“That made it difficult for many co-ops to accept grants without exceeding the 15-percent limit on non-member income they must maintain to keep their tax-exempt status,” America’s electric Cooperatives wrote. “The bipartisan RURAL Act fixed the problem by exempting grants from being counted as income.”
In reaction to the news, DEC General Manager Keith Brooks told The World that the RURAL Act approval came as a relief.
“It feels like a huge burden has been lifted from our rate payers backs here in Oregon,” Brooks said. “We were facing several big challenges in the coming years.”
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Prior to the devastating February storm, DEC had planned on preparing its Roseburg headquarters for a Cascadia-sized earthquake and to get its systems ready to withstand wildfires.
“But after the storm and possibly having this tax burden that we weren’t sure would be resolved complicated everything we wanted to do as far as planning and implementing plans for the next big disaster,” Brooks said. “It was a huge worry of ours and we’re ecstatic that it has been lifted.”
In the weeks leading up to the House and Senate votes on the RURAL Act, Brooks said DEC reached out to both Sen. Jeff Merkley and Sen. Ron Wyden’s offices several times looking for support.
“We talked to their staff and I would like to think we played a part by certainly trying to get the word out,” Brooks said. “At the end of the day, it was a bipartisan effort. Though this affected the whole country, we were fortunate that our leadership in Oregon was key to moving this through the Senate. Sen. Wyden stepped up and took care of this for us. We can’t thank him enough for getting it done for us this year.”
Now that the RURAL Act is passed, DEC can look ahead to wrapping up repairs from the February storm and looking ahead to bracing for the next big weather event.
“We think this is the best Christmas present,” Brooks said. “We thank all the representatives and legislators in Oregon that stepped up ... We all benefit from this as Oregonians. It’s a great way to end the year.”