Fannin EC Builds New HQ with Financing from CFC

In mid-June, Fannin Electric Cooperative employees moved into their new headquarters building in Bonham, Texas. Financed by CFC, the 18,000-square-foot facility features a host of new features benefiting the cooperative, its employees and its members. 

“Our old building was constructed in 1996 to accommodate 20 employees. We currently have 43 employees and we not only needed more space, but also needed a better facility to serve our members,” Fannin EC CEO John Ed Shinpaugh said.

The distribution cooperative has experienced double-digit load growth over the past few years. “We are within one hour of Dallas, and urban sprawl has reached our territory,” Shinpaugh explained. “Also, a large, 16,000-acre reservoir was recently built in our county and there are several lakeside subdivisions along with commercial and retail facilities coming with it. We currently have 12,000 meters, but there are another 7,000 residential lots either planned or under construction.”

COVID, Uri Delay Project

Planning for the building project began in 2019. Fannin EC initially worked with an architectural firm on a feasibility study to help determine whether to renovate or expand the old facility, or build a new one. Management also worked closely with its board of directors to solicit input. 

“We are fortunate at Fannin to have a very engaged board of directors who challenge us with any project or endeavor of this magnitude,” Shinpaugh said. “We asked them to be an integral part of the initial process and feasibility study. At the end of the day, primarily due to labor and demolition costs, the price to renovate was 77% of a new facility. So, it was a no-brainer to build new.”

The project was slowed due to the pandemic in 2020 and again by Winter Storm Uri and its financial aftermath in 2021 and 2022. Construction on the new building finally began in March 2023 with Fannin choosing Cooperative Building Solutions as the project manager and general contractor.

New Building Benefits All Stakeholders

The new facility, which is nearly 65% larger than the old building, is purpose built for Fannin EC’s needs, which helps the cooperative improve its organizational effectiveness and efficiency.

“In the new building, departments can now be situated next to each other to work more efficiently,” Shinpaugh said. “We also have departmental conference rooms with multimedia facilities strategically located throughout the building.”

A large meeting room was included for employee training, all-employee meetings and presentations. The room has multimedia capabilities and a moveable dividing wall to hold simultaneous meetings.

The warehouse space is roughly the same size as the old building, but the new facility has higher racking and allows delivery trucks and bucket trucks to pull through for loading and unloading out of the weather.

The new facility is also more energy efficient, with high-efficiency LED lighting, an advanced central building management system for heating and cooling, and powered blackout shades on sun-facing windows and external doors.

Importantly, electricity at the new facility is delivered by Fannin EC, while the old building was served by an investor-owned utility.

Fannin EC employees also benefit from many aspects of the new facility. “Our updated technology and multimedia capabilities will support employee learning and greatly improve their ability to serve our members,” Shinpaugh said.

The new building also has improved safety features, with a secure front lobby area with bullet-proof glass. There is also an employee fitness room, a large break room and an outside, covered patio area. 

“Our line workers now have a large office space with individual cubicles and multimedia for safety training,” Shinpaugh said. “They also have a locker area with individual lockers that can accommodate their gear as well as secure their valuables.”

Fannin EC members benefit, too. “The new building has a drive-through area that members can use to conduct business with us, and the parking lot was designed so members can park right in front of the building,” Shinpaugh said. “The old building had no drive-through, and parking was on the side, with a long sidewalk to the front door. These updates will enable us to better serve members with mobility issues and also will help in times of bad weather.”

The entire facility is also on a back-up generator, allowing continued service to members if an outage occurs.

CFC Provides Financing

As a 100% CFC borrower, Fannin EC reached out to CFC to finance the $19 million building project. CFC was happy to support the project with a series of 30-year notes with repricing options.

“No one likes spending large sums of money,” Shinpaugh said. “However, you will never build a new facility any cheaper than right now.

Fannin EC expects to tap CFC for additional financing in the years ahead. “Due to growth, our borrowing for infrastructure and plant in the last two years was roughly 400% of the previous three to five years,” Shinpaugh said. “We see that trend continuing for the foreseeable future.”

Shinpaugh explained that the need for the new building project was primarily driven by space and efficiency needs for its employees to better serve the members. “I have been in the people business for 46 years, with 40 of that in a leadership position,” he concluded. “I have always believed that if you take care of your employees, they will take care of your members. This project is a great example of one way we are doing both.”