{"data":{"id":"us-mi/mich.-comp.-laws-450.3135","jurisdiction":"us-mi","citation":"Mich. Comp. Laws § 450.3135","heading":"Net savings; determination, allocation, distribution, and use; apportionment of losses.","body":"Sec. 1135.\n\nAt least once each year, a cooperative shall determine its net savings by deducting from total income:\n\nAll operating costs and expenses.\n\nReasonable reserves for depreciation and obsolescence of property, doubtful accounts, other valuation or operating reserves, capital investments and reserves for capital investment.\n\nDividends paid on member capital and interest or dividends paid on nonvoting investment certificates or bonds, if any.\n\nThe articles or bylaws may provide for any reasonable method of allocating net savings by the board of directors for the common benefit of all the patrons of a cooperative.\n\nUnless the articles or bylaws otherwise provide pursuant to subsection (2), net savings shall be allocated, distributed, or used in any of the following ways:\n\nBy allocation of net savings to all patrons at a uniform rate in proportion to their individual patronage, provided that different rates of allocation may be established according to the net savings generated by various departments or types of business done by the cooperative. Distribution to patrons may be made as follows:\n\nIn cash or credits. Credits shall be evidenced by shares, revolving fund certificates, notices of allocation, capital credits, or other certificates or notices of the cooperative, or any combination thereof.\n\nIn the case of nonmember patrons who have subscribed for membership, distribution may be credited toward payment of unpaid member capital or membership fees.\n\nIn the case of nonmember patrons, distribution of the proportionate amount of net savings generated by nonmember patronage may be made to a general fund. Redistribution shall be made to an individual nonmember patron only upon request and presentation of evidence of the nonmember's patronage. Such net savings may be distributed in cash or credited toward payment of member capital or membership fees. Reasonable notice shall be provided to nonmember patrons of their rights to redistribution and the means of applying for membership.\n\nBy allocation to retained earnings, operating costs or capital expenditures of the cooperative to reduce the costs of goods, facilities, or services, to improve the quality provided or otherwise to further the common benefit of the patrons.\n\nThe articles or bylaws may include any reasonable provisions for the apportionment of losses.","path":["MI Code","Chapter 450","Act Act-162-of-1982"],"source_url":"https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-450-3135","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:31Z","sha256":"93d8d1f9d8f3894e44240d25b5ec9097185b2e4a9e7ee787fed85fa11c83a89a","source_id":"us-mi","stale":false,"prev":"us-mi/mich.-comp.-laws-450.3134","next":"us-mi/mich.-comp.-laws-450.3136"},"notice":"GroundRules: Original legal text. Not legal advice."}