One of the problems, in addition to the Great Depression, that rural farmers and communities faced in the mid ‘30s was the lack of infrastructure to provide electric service.
Nine out of 10 homes were without electric service, and a report written by investor-owned electric industry executives said, “there are very few farms requiring electricity for major farm operations that are not now served.” As a result of the utilities’ “research,” city-based investor-owned electric companies refused to build or extend lines to the rural areas, saying it would not be profitable. It was wildly apparent these executives hadn’t asked farmers north of Kansas City if they “required” electricity.
Video – When the Lights Came On
Produced by Platte-Clay Electric Co-op
Because of the importance of having electricity in rural homes and farms, in 1935 President Franklin D. Roosevelt created the Rural Electrification Administration (REA) as part of the New Deal program.
The purpose of the REA was to make low-interest loans available to local electric cooperatives so the co-ops could get the capital needed to build electric lines in the rural areas. Roosevelt knew the program would create jobs, increase productivity, help with education and improve the quality of life in the farming communities.
Executive Order No. 7037, which became law in 1936, became the impetus for rural electric cooperatives to start forming in the sparsely-populated rural areas throughout the U.S. The REA insisted that any rural electric co-op have a strong organization that could become a successful cooperative.
Platte-Clay Organized in 1938
In 1938, Platte-Clay organizers began meeting to organize a co-op that today is recognized as one of the more progressive member-owned utilities in Missouri.
The early incorporators were a group of community leaders:
- Howard Alexander, East Leavenworth, Mo.
- Earl L. Arnold, Holt
- William Bailey, Trimble
- Thomas B. Chinn, Platte City
- A. D. Davis, Weston
- Ralph E. Davis, Platte City
- Floyd E. Downing, Kearney
- Ray Durkes, Weston
- C. D. Lober, Weston
- E. H. McClary, Smithville
- Mary D. Miller, Smithville
- T. L. Olvis, Beverly Station
- Robert A. Phillips, Holt
- J. B. Ray, Dearborn
- Andrew Sewell, Smithville
- Matt Smith, Kearney
- Jno. C. Stanton, Rushville
- Ben Thomas, Dearborn
- E. Wagy, Kearney
- Ford White, Kearney
- J. E. Woods, Parkville
- Perry Wright, Edgerton
The first meeting, where the group signed the articles of incorporation, was Aug. 27, 1938, and they organized the board of directors. One of the first motions was to wire the REA to ask for funds to start building the system.
Area farmers sign up for electric service
The Board also hired the first employees, Jean DeMasters, office help, and Howard Alexander and Earl L. Arnold to work on contacting farmers to sign up for electric service. Membership cost $5, no small sum in the height of the Depression. Howard Alexander worked in Platte County and Earl Arnold worked in Clay and Clinton Counties.
At the second meeting, Sept. 3, 1938, the Board formed a committee to find and recommend an engineer. The co-op attorney, David R. Clevenger, reported that the REA had the co-op charter for approval.
By the third meeting, Sept. 28, 1938, Howard Alexander had 273 Platte County residents and Earl Arnold brought in 100 Clay and Clinton County membership applications.
The By-Laws were approved with one change: beginning September, 1939, there would be three directors elected for three years and the following year they would elect three directors for three years, and each year thereafter. The rolling elections would provide both continuity and the opportunity for change, which continues today.
Platte-Clay selects an engineer
The co-op Board moved quickly. At the Oct. 4, 1938, meeting, the Board selected E. T. Archer and Co., of Kansas City, Mo., as engineers to build the electrical system. Archer received one more vote than Black and Veatch, also of Kansas City.
The Board approved 360 Platte County members, 213 Clay County and 90 Clinton County members at the Nov. 10, 1938 meeting.
Easements were the building blocks for the new co-op, and Howard Alexander reported the co-op had 98 Clay County easements signed, 125 Platte County easements completed and another 25 more ready to sign.
The REA’s Examining Division told the Board to make the system as large as possible to increase the number of potential members and density, which would help operate the co-op as economically as possible.
The November meeting included all of the incorporators and members of the Platte-Clay board who approved the By-Laws. The purpose of the co-op given in the original By-Laws “is to make electric energy available to its shareholders (hereinafter called ‘members’) at the lowest cost consistent with sound economy and good management.”
At the next meeting, Jan. 10, 1939, the Board of Directors authorized constructing 456 miles of electric transmission and distribution lines, with the approval of the REA, and borrowing $487,000 from the United States of America to finance construction and operation.
In five short months Platte-Clay had grown from an idea to a rural electric cooperative with 1,367 members. There was a long way to go, but the co-op was taking important first steps and strides in delivering electric service to the rural families.
Platte-Clay selects a construction company
At the April 24, 1939, meeting the co-op Board held a special meeting to open construction bids for the two sections starting in Platte City and Plattsburg. Six contractors submitted bids: O. F. Schroeder, University City, Mo.; Smith Bros. Construction Co., Kansas City, Mo.; Federal Engineering & Construction Co., Kansas City, Mo.; Phelan Construction Co., Davenport, Iowa; A. W. Mosley, Kansas City, Mo.; and Cook-O’Brien Construction Co., Kansas City, Mo.
The Board also decided to use copperweld, copper conductor, line and conventional transformers that day.
The next day, the Board met with Mr. Schroeder and learned that the O. F. Schroeder firm was an offshoot of Schroeder Contracting Co., formed specifically for REA construction projects.
Although T. E. Archer, the engineer, wasn’t familiar with the construction company, the Schroeder construction bid was almost $25,000 lower than other bids, so the Board went with the University City, Mo., company. Schroeder said they would start work on both sections at the same time.
REA asks for support in Washington
Some things never change: REA Administrator John Carmody urged the Board to contact their Senators and Representative to support the Rural Electrification Bill, S.B. 237 and H.B. 567, which came to be known as the Cooperative Act. Then as now there was considerable resistance to providing funds to develop the infrastructure for the poorer, rural areas. The Board voted to contact the legislators individually.
At the May 20, 1939, Board meeting, because of difficulties with rights of way near Iatan, east of Trimble and the route between Lathrop and Plattsburg, the original plan would have to be changed, requiring communication with the REA.
REA Director Carmody asked that the co-op send representatives to Jefferson City to gain support for H.B. 567, the Cooperative Act.
The first president, A. D. Davis, resigned because of illness, which had caused him to miss several meetings. Howard Alexander was elected a member of the Board and President to serve Davis’ unexpired term.
Among the bills approved for payment at that meeting was $2,427.66 to T. E. Archer for final plans and maps.
Platte-Clay relies on local newspapers
Then, as now, the co-op advertised in the local newspapers: the Lathrop Optimist, Plattsburg Leader and Kearney Courier and, in those first days, the Platte City Landmark.
REA approves plans
The Board learned at the May 27, 1939, meeting that the REA had approved both T. E. Archer’s plans and O. F. Schroeder’s construction contract. The REA set a 150 day completion date for the Platte City section and a 120 day deadline for the Plattsburg distribution lines.
One of the bills approved for payment that day was to H. M. Anderson Typewriter Co., Inc., for an L. C. Smith typewriter, 14 inch carriage, elite type, $95.81.
In 1939, families didn’t have radios, irons, refrigerators, electric washing machines, lamps and other appliances waiting to be plugged in.
Although the first refrigerators were sold in 1913, the rural areas didn’t have electricity, and much of America didn’t have money to buy appliances. World War II and rationing also put a damper on sales in urban areas.
In addition to hanging on through the Great Depression, rural families had been managing without electricity.
To help develop the need for electric service, the co-op proposed loaning members up to $10 to buy appliances. The Board believed that members’ enthusiasm for new labor-saving devices, such as an electric washing machine, would help gain new members. The loan would be funded by REA monies.
It was along the lines of classic marketing using push-pull: provide the service (push) and then create a need for consumers to buy the service (pull).
By 1944, 85 percent of American households had a refrigerator.
By 1953, more than 90 percent of U.S. farms had electric service, and in 2011, about 99 percent of U.S. farms have electric service.
Today the REA has evolved to become the Rural Utilities Service (RUS) and is part of the U.S. Department of Agriculture.
Platte-Clay: committed to rural area
Committed to the members and communities it serves, Platte-Clay continues to upgrade the electric system and integrate technology to better serve its membership.
Energy conservation programs, including a free online or $50 in-home energy audit to help members manage costs, Youth Tour and online billing are all ways that the co-op provides relevant and important products and services for members. A quick response (QR) code for smart phones and outage map on the website helps provide fast customer service.
Co-ops provide another member benefit: as is the practice for cooperatives, monies not required for good business practices are returned to members in the form of a capital credit check.
The future? Probably a version of more of the same: good service, commitment to reliability and a desire to “meet and exceed members’ expectations.”