NRECA 75 Years of Service

In December 1941, America went to war. Material needed for the war effort forced a ban on the use of copper for building rural power lines. With the ban, rural electrification was put on hold. Even worse, electric cooperatives were accused of treason by a Congressman from Kansas.

Congressman Thomas Winter -- a strong supporter of the large power companies -- alleged the REA and a local electric cooperative were hoarding a trainload of copper near Gilmer, Texas. Copper was needed for the war, he claimed. A congressional investigation proved those accusations false.

Though exonerated, the incident exposed the political weakness of co-ops. Determined to correct that, ten dynamic rural leaders met at the historic Willard Hotel in 1942 to create a national organization that would represent the interests of all electric cooperatives. They called it the National Rural Electric Cooperative Association. Then they turned to Clyde Ellis, an Arkansas congressman and brilliant orator with a passion for rural electrification, to lead it.

As NRECA’s first chief executive, Ellis was intent on building the organization into a national political force. The nation’s electric cooperatives now had a powerful voice in Washington, D.C. And while the issues have changed over 75 years, the presence of a unified association with multiple services for its members is as necessary as ever.

From the earliest days of rural electrification, innovation was a necessity. From the unique demands of electrifying remote and rugged regions to establishing field and office systems, co-ops have always had to find creative solutions in the delivery of safe, affordable and reliable power.

Though highly skilled and gifted individuals contributed locally, co-ops deployed their greatest strengths – cooperation and collaboration -- to maximize electric utility and grid research on behalf of the millions of co-op members in the national network.

In the late 1960s and early 1970s, cooperative operations were becoming computerized. But these machines were expensive, so NRECA created eight regional timesharing co-ops to give members access to big mainframe computers to process member bills and perform other functions. Local leaders formed regional data pooling facilities to meet growing needs.

These data processing cooperatives grew and consolidated over the years, tapping a rapidly increasing number and variety of technological advances for the benefit of electric cooperatives and others. NRECA first established a formal electric power research program in 1973. The program was designed to inspire, test and share ideas and technology breakthroughs for all the cooperative network. Millions of dollars have been invested in new research and field tests in recent years, enabling valuable innovations in distributed energy resources, improved grid resiliency and other technologies.

In 1972, President Richard Nixon won re-election by a landslide, affirming his belief that he had a mandate to cut government. With his dislike for the REA program and electric co-ops, Nixon issued an executive order on Dec. 29, 1972 that would have wiped out REA’s 2 percent direct loan program. The action immediately created a financial crisis for the nation’s electric cooperatives. That day became infamously known as Black Friday.

NRECA General Manager Bob Partridge plotted a strategy to enlist Congress in overturning the president’s order. In January 1973, 1,400 rural leaders packed the Mayflower Hotel in Washington, where Sen. Hubert Humphrey of Minnesota rallied them to: “[U]se what has been done to demonstrate whether or not one man, by executive order, can ignore the will of the American people…” Electric co-op leaders descended upon Capitol Hill and lobbied to save the REA.

More than 700 co-op leaders returned to Washington, D.C. in early May to support forceful legislation ensuring a secure loan program for the nation’s co-ops. Nixon, beset with Watergate investigations, signed the bill with little fanfare. Black Friday is still one of NRECA’s greatest legislative victories. It was achieved with bipartisan support and “boots on the ground” at a spring legislative conference that continues to this day.

In 1957, Texas Senator Lyndon B. Johnson, who was always an advocate for electric co-ops, was first to suggest that co-ops could send youth groups to Washington.

By 1964, NRECA had coordinated with statewides to create the Youth Tour program. About 400 teens from a dozen states came to the nation’s capitol that year. Lyndon Johnson was now President. He welcomed the electric co-op youth to the White House lawn.

Today, co-ops sponsor between 1,400 – 1,600 teens from across the nation for a week in Washington. They tour historic monuments, listen to presentations on co-ops and American history, and meet with lawmakers. More than 50,000 young leaders have been a part of Youth Tour in its 53-year mission.

In October 1962, a young American president was confronted with the prospect of nuclear war with the Soviet Union. As the world held its breath, John F. Kennedy navigated the U.S. through the Cuban Missile Crisis.

Kennedy cleared his schedule except for meetings with his military advisors….with one exception. In the Oval Office, President Kennedy and NRECA leaders participated in a signing ceremony with the U.S. Agency for International Development to bring electricity beyond America’s borders.

NRECA CEO Clyde Ellis had persuaded JFK that electric cooperatives could share the lessons learned in rural America with developing countries and block the spread of communism.

For more than 50 years, NRECA International has been a global ambassador for the cooperative business model, working in developing countries to improve lives through electrification.

In the 1950s, the rural electric cooperative program was booming, growing several times faster than investor-owned and municipal utilities.

Cooperative leaders began to recognize the need for new sources of financing to supplement REA’s lending programs. NRECA developed a plan for legislation to establish a rural electric bank that would initially be supported by the federal government, but was met with strong investor-owned utility opposition.

Going back to the drawing board, NRECA appointed a Long-Range Study Committee in August 1967 to devise a plan to meet cooperatives’ future financing needs. The National Rural Utilities Cooperative Finance Corporation was the result.

CFC was incorporated on April 10, 1969, as a member-owned, nonprofit financing cooperative charged with raising funds from the capital markets on behalf of electric cooperatives. Its first Governor was J.K. Smith (center), president of Kentucky Rural Electric Cooperative Corporation. In its first year, more than 500 co-ops joined CFC as founding members.

Nearly 50 years later, CFC remains a vital provider of low-cost private capital and state-of-the art financial services to rural electric cooperatives.

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PublishedApril 20, 2017

The qualities that made NRECA strong 75 years ago are the same qualities that make us strong today. Above are some seminal moments in NRECA’s history that tell the story of our evolution and our commitment to America’s electric cooperatives. As we focus on the next 75 years, NRECA is fostering innovation and preparing members to succeed in an evolving energy landscape.