2024-11-15T15:13:40-06:00 2023-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2023-01-01 740880083 SAN BERNARD ELECTRIC COOPERATIVE INC SANB 9798653171 PO BOX 1208 BELLVILLE TX 77418 MIKE ABLES CEO/MANAGER 9798653171 2024-10-22 1 0 WILLIAM M MILLER P00439459 8067473806 2024-10-21 X 2023 2024-10-15 13:58:12Z MIKE ABLES PO BOX 1208 BELLVILLE TX 77418 106821143 0 X WWW.SBEC.ORG X 1939 TX TO PROVIDE QUALITY AND RELIABLE ELECTRIC SERVICE TO MEMBERS OF THE COOPERATIVE. 9 9 117 0 1495 0 0 0 106734702 106243845 153818 144990 134804 112857 107023324 106501692 59581 73017 7694076 11209022 7989682 8044876 0 0 0 91239525 87189254 106982864 106516169 40460 -14477 291758444 266819265 192598483 158349118 99159961 108470147 SBEC PROVIDES AFFORDABLE, RELIABLE ELECTRICITY AND INNOVATIVE AND PERSONALIZED ENERGY SERVICES FOR OUR MEMBER-OWNERS. 0 0 PROVIDING ELECTRIC ENERGY TO OUR MEMBERS - 32,224 ACTIVE SERVICES AT YEAR END WERE PROVIDED ELECTRICITY ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. 0 0 0 0 0 0 0 1 0 1 0 1 0 1 1 1 0 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 71 0 117 1 1 1 0 0 0 0 104624705 2009039 0 0 0 X 9 9 0 0 1 0 1 1 1 1 0 0 0 1 1 1 1 0 0 1 1 0 X JARED JANICEK BUSINESS GROUP MANAGERCFO 9798653171 309 WEST MAIN STREET BELLVILLE TX 77418 X LARRY CHANEY DIRECTOR 5.00 X 19110 0 0 SAMMY CONDRA PRESIDENT 15.00 X X 30983 0 0 VANCE R ELLIOTT ASST SECRETARY/TREASURER 10.00 X X 21160 0 0 COLT HAACK DIRECTOR 10.00 X 32383 0 0 JASON JOHNSON DIRECTOR (FEB-DEC) 8.00 X 15308 0 0 NORMAN KIECKE VICE PRESIDENT 6.00 X X 32583 0 0 CHARLES MATULA SECRETARY/TREASURER 3.00 X X 17760 0 0 KARL N MICKLITZ DIRECTOR 7.50 X 19203 0 0 LORI WALKER 3RD CHAIRMAN 10.00 X X 18210 0 0 MICHAEL ABLES CEO 55.00 X 220343 0 189926 JARED JANICEK BUS GROUP MANAGER 50.00 X 139011 0 70190 JAMES JOUETT ELECTRIC SYSTEMS GROUP MGR 50.00 X 183173 0 115214 SHAWN BARD IT GROUP MANAGER 41.00 X 141679 0 65028 ROBERT HROMADKA LINE CREW LEADER 45.00 X 123612 0 81246 JAMES PHILLIPS 1ST CLASS LINE TECH 59.00 X 151566 0 64357 ROBERT PINA 1ST CLASS LINE TECH 53.00 X 128655 0 48075 JOHN SPIESS MEMBER SERVICES MANAGER 43.00 X 135156 0 76279 1429895 0 710315 23 0 1 0 14 X SALES OF ELECTRICITY 221000 98916118 98916118 PATRONAGE DIVIDENDS 221000 6135331 6135331 SERVICE FEES 221000 641894 641894 LEASE INCOME FROM LCRA 221000 467015 467015 OTHER PROGRAM REVENUE 221000 83487 83487 106243845 142281 142281 24193 21484 2709 2709 2709 332268 297967 34301 32806 1495 POLE ATTACHMENT INCOME 221000 52468 52468 OTHER NON-OPERATING INCOME 221000 26088 26088 78556 106501692 106302739 1495 197458 X 73017 11209022 1124557 4768269 840947 964288 346815 5225624 7489683 PURCHASED POWER 65735374 DISTRIBUTION EXPENSE 5840077 CONSUMER EXPENSE 1306464 ADMIN & GENERAL EXPENSE 995254 596778 106516169 721004 1139938 3946801 3696970 66802 48015 5037568 4582639 70283509 65542087 240690213 80609859 203688527 160080354 6593749 30323255 1420484 1406007 291758444 266819265 9092587 7242595 59134 38203 175449908 139371865 7996854 11696455 192598483 158349118 X 50390 48650 0 0 99109571 108421497 99159961 108470147 291758444 266819265 X -14477 9324663 X X 0 1 X 1 0 0 1 X 195331 195331 6657409 4400273 2257136 229743967 76209586 153534381 4093506 4093506 160080354 PATRONAGE CAPITAL - CFC 3105244 C PATRONAGE CAPITAL - TEC 711962 C PATRONAGE CAPITAL - NISC 158464 C PATRONAGE CAPITAL - COBANK 112703 C PATRONAGE CAPITAL - PRODUCERS 146292 C PATRONAGE CAPITAL - NRTC 75222 C PATRONAGE CAPITAL - STEC 6522773 C PATRONAGE CAPITAL - FEDERATED 169933 C CAPITAL TERM CERTIFICATES - CFC 19318077 C MEMBERSHIPS IN ASSOC. ORGS. 2585 C 30323255 ACCUMULATED PROVISION FOR POST RETIREMENT BENEFITS 3455886 CONSUMER DEPOSITS 852973 DEFERRED CREDITS - UNCLAIMED CAPITAL CREDITS 691143 DEFERRED CREDITS - ADVANCES FOR CONSTRUCTION 1597464 DEFERRED CREDITS - ENERGY PREPAYMENTS 427338 DEFERRED CREDITS - OTHER 18 POWER COST ADJUSTMENT - OVER COLLECTED 4640814 OTHER LIABILITIES 30819 11696455 X 106501692 0 106501692 0 106501692 95307147 0 95307147 11209022 11209022 106516169 PART IV, LINE 2B: PURSUANT TO SECTION 74.3013 OF THE TEXAS PROPERTY CODE, THE COOPERATIVE HAS ESTABLISHED A RURAL SCHOLARSHIP FUND WITH AMOUNTS DESIGNATED UNCLAIMED UNDER STATE LAW. THE AMOUNTS DEPOSITED INTO THE RURAL SCHOLARSHIP FUND ARE APPROVED BY THE STATE OF TEXAS AND CAN ONLY BE USED FOR SCHOLARSHIPS TO ENABLE STUDENTS FROM RURAL AREAS TO ATTEND COLLEGE, TECHNICAL SCHOOL OR OTHER POST SECONDARY EDUCATION INSTITUTION. ANY AMOUNTS SO DEPOSITED INTO THE RURAL SCHOLARSHIP FUND ARE STILL PAYABLE TO THE PERSON TO WHOM THE ORIGINAL PAYMENT WAS MADE BUT UNCLAIMED. THE COOPERATIVE HAS PUT INTO PLACE AN "OPERATION ROUNDUP" PLAN. MEMBERS WHO WISH TO PARTICIPATE IN THE PLAN VOLUNTARILY ROUND THEIR ELECTRIC BILLS UP TO THE NEAREST WHOLE DOLLAR. THE DIFFERENCE IS USED TO FUND THE PLAN. THE "OPERATION ROUNDUP" FUNDS ARE MAINTAINED IN A SEPARATE ACCOUNT AND USED TO SUPPORT EDUCATION PROJECTS, YOUTH PROJECTS, COMMUNITY PROJECTS AND EMERGENCY ASSISTANCE WITHIN THE COMMUNITIES AND AREAS SERVED BY THE COOPERATIVE. PART X, LINE 2: THE COOPERATIVE HAS ADOPTED THE "UNCERTAIN TAX POSITIONS" PROVISIONS OF ACCOUNTING PRINCIPLES GENERALLY ACCEPTED IN THE UNITED STATES OF AMERICA. THE PRIMARY TAX POSITION OF THE COOPERATIVE IS ITS FILING STATUS AS A TAX EXEMPT ENTITY. THE COOPERATIVE DETERMINED THAT IT IS MORE LIKELY THAN NOT THAT ITS TAX POSITIONS WILL BE SUSTAINED UPON EXAMINATION BY THE INTERNAL REVENUE SERVICE, AND THAT ALL TAX BENEFITS ARE LIKELY TO BE REALIZED UPON SETTLEMENT WITH TAXING AUTHORITIES. PART XII, LINE 4B - OTHER ADJUSTMENTS: PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 11,209,022. PART IX: THE AMOUNT OF OTHER ASSETS ON FORM 990, PAGE 11, PART X, LINE 15 DOES NOT EQUAL OR EXCEED 5% OF THE TOTAL ASSETS ON FORM 990, PAGE 11, PART X, LINE 16, COLUMN B. CONSEQUENTLY, IN ACCORDANCE WITH IRS INSTRUCTIONS, SCHEDULE D, PART IX HAS BEEN LEFT BLANK. PART XII, LINE 4B: FOR THE AUDITED FINANCIAL STATEMENTS, THE AMOUNT OF PATRONAGE DIVIDENDS PAID OR ALLOCATED TO THE MEMBERS IS REPORTED AS AN INCREASE IN EQUITY AND NOT AS AN EXPENSE. THEREFORE, NET INCOME PER THE AUDITED FINANCIAL STATEMENTS IS REPORTED GROSS OF THE AMOUNT OF PATRONAGE DIVIDENDS THAT ARE EITHER ALLOCATED OR TO BE ALLOCATED AT THE TIME THE AUDITED FINANCIAL STATEMENTS ARE PREPARED. HOWEVER, BECAUSE THE ALLOCATION OF PATRONAGE DIVIDENDS IS ONE ASPECT OF HOW THE COOPERATIVE FULFILLS ITS TAX EXEMPT PURPOSE OF OPERATING ON A COOPERATIVE BASIS, THE AMOUNT OF PATRONAGE DIVIDENDS EITHER ALLOCATED OR TO BE ALLOCATED TO THE MEMBERS IS REPORTED ON FORM 990, PART IX, LINE 4 AS "BENEFITS PAID TO MEMBERS". 0 AUSTIN COUNTY FAIR ASSOCIATION PO BOX 141 BELLVILLE TX 77418 741048551 501(C)(3) 6600 0 2022 DONATION COLORADO COUNTY FAIR ASSOCIATION INC 316 SPRING ST COLUMBUS TX 78934 742181450 501(C)(3) 7200 0 2022 DONATION WALLER COUNTY FAIR ASSOCIATION 21988 FM 359 HEMPSTEAD TX 77445 741481196 501(C)(3) 14350 0 2022 DONATION X X X X 0 0 0 MICHAEL ABLES CEO 209893 0 5000 0 5450 0 163045 0 26881 0 410269 0 0 0 JAMES JOUETT ELECTRIC SYSTEMS GROUP MGR 175288 0 3083 0 4802 0 103132 0 12082 0 298387 0 0 0 JAMES PHILLIPS 1ST CLASS LINE TECH 148459 0 1470 0 1637 0 36669 0 27688 0 215923 0 0 0 JOHN SPIESS MEMBER SERVICES MANAGER 129796 0 2218 0 3142 0 64093 0 12186 0 211435 0 0 0 JARED JANICEK BUS GROUP MANAGER 136146 0 2413 0 452 0 42140 0 28050 0 209201 0 0 0 SHAWN BARD IT GROUP MANAGER 137547 0 2471 0 1661 0 36935 0 28093 0 206707 0 0 0 ROBERT HROMADKA LINE CREW LEADER 119218 0 1797 0 2597 0 55883 0 25363 0 204858 0 0 0 ROBERT PINA 1ST CLASS LINE TECH 126221 0 1416 0 1018 0 34930 0 13145 0 176730 0 0 0 PART II, COLUMN C: INCLUDED IN THIS AMOUNT IS THE INCREASE IN ACTUARIAL VALUE OF BENEFITS PAYABLE UNDER A DEFINED BENEFIT RETIREMENT PLAN. THE CONTRIBUTION RATE FOR PARTICIPANTS IN THE NRECA R&S DEFINED BENEFIT PENSION PLAN ARE THE SAME FOR ALL INDIVIDUALS IN THIS MULTI-EMPLOYER PLAN. THE CHANGE IN ACTUARIAL VALUE FOR EACH PARTICIPANT, HOWEVER, VARIES WITH AGE, YEARS OF SERVICE AND THE CURRENT INTEREST RATE ENVIRONMENT. IN OTHER WORDS, THE OLDER A PLAN PARTICIPANT IS, THE GREATER THE INCREASE IN THAT INDIVIDUAL'S CHANGE IN ACTUARIAL VALUE, ALL OTHER THINGS BEING EQUAL. BECAUSE THIS RELATES TO A MULTI-EMPLOYER PLAN, CASH CONTRIBUTIONS TO THE PLAN IN LIEU OF THE ACTUARIAL INCREASE ARE EXPENSED IN THE FINANCIAL STATEMENTS. MICHAEL ABLES: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 150,099 EMPLOYER CONTRIBUTION TO 401(K) PLAN 12,946 TOTAL REPORTED IN COLUMN C $ 163,045 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (150,099) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 50,099 EXPENSE TO THE COOPERATIVE $ 63,045 JAMES JOUETT: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 92,600 EMPLOYER CONTRIBUTION TO 401(K) PLAN 10,532 TOTAL REPORTED IN COLUMN C $ 103,132 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (92,600) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 43,043 EXPENSE TO THE COOPERATIVE $ 53,575 JAMES PHILLIPS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 31,525 EMPLOYER CONTRIBUTION TO 401(K) PLAN 5,144 TOTAL REPORTED IN COLUMN C $ 36,669 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (31,525) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 20,658 EXPENSE TO THE COOPERATIVE $ 25,802 JOHN SPIESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 56,262 EMPLOYER CONTRIBUTION TO 401(K) PLAN 7,831 TOTAL REPORTED IN COLUMN C $ 64,093 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (56,262) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 30,500 EXPENSE TO THE COOPERATIVE $ 38,331 JARED JANICEK: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 33,619 EMPLOYER CONTRIBUTION TO 401(K) PLAN 8,521 TOTAL REPORTED IN COLUMN C $ 42,140 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (33,619) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 32,926 EXPENSE TO THE COOPERATIVE $ 41,447 SHAWN BARD: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 28,330 EMPLOYER CONTRIBUTION TO 401(K) PLAN 8,605 TOTAL REPORTED IN COLUMN C $ 36,935 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (28,330) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 34,299 EXPENSE TO THE COOPERATIVE $ 42,904 ROBERT HROMADKA: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 49,635 EMPLOYER CONTRIBUTION TO 401(K) PLAN 6,248 TOTAL REPORTED IN COLUMN C $ 55,883 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (49,635) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 25,142 EXPENSE TO THE COOPERATIVE $ 31,390 ROBERT PINA: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 30,002 EMPLOYER CONTRIBUTION TO 401(K) PLAN 4,928 TOTAL REPORTED IN COLUMN C $ 34,930 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (30,002) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 19,865 EXPENSE TO THE COOPERATIVE $ 24,793 FORM 990, PART I: IN GENERAL, WHEN AN ELECTRIC COOPERATIVE BASES THE PATRONAGE DIVIDEND CALCULATION ON ITS NET BOOK INCOME/(LOSS), PAGE 1, PART I, LINE 19 - REVENUE LESS EXPENSES - WILL BE $0. FOR THE CURRENT YEAR, PAGE 1 , PART I, LINE 19 REPORTS NET LOSS OF ($14,477), WHICH IS THE INCOME STATEMENT EFFECT OF ACCRUED UNBILLED REVENUE. THE GAAP BASIS FINANCIAL STATEMENTS INCLUDE AN ACCRUAL FOR UNBILLED REVENUE BECAUSE THE COOPERATIVE'S BILLING CYCLE DOES NOT END ON THE LAST DAY OF THE MONTH. THEREFORE, IT HAS REVENUE IN DECEMBER OF EACH YEAR THAT IT HAS EARNED BUT WILL NOT BILL UNTIL THE FIRST BILLING CYCLE OF THE FOLLOWING YEAR. THE COOPERATIVE ESTIMATES THIS REVENUE AND RECORDS IT AS ACCRUED UNBILLED REVENUE IN ORDER TO MATCH THE REVENUE WITH THE YEAR EARNED. HOWEVER, THE COOPERATIVE ALLOCATES THE REVENUE TO MEMBERS IN THE YEAR IT IS BILLED RATHER THAN WHEN ACCRUED. THIS TIMING DIFFERENCE IS FAIR AND EQUITABLE BECAUSE IT MATCHES THE PATRONAGE DIVIDEND ALLOCATED WITH THE BILLING RECORDS USED TO ALLOCATE THE MARGINS. DUE TO THE TIMING OF WHEN THE COOPERATIVE ALLOCATES ACCRUED UNBILLED REVENUE, PAGE 1, PART I, LINE 19 ANNUALLY REPORTS NET INCOME EQUAL TO THE NET INCREASE IN ACCRUED UNBILLED REVENUE OR A NET LOSS EQUAL TO THE NET DECREASE IN UNBILLED REVENUE. THE FOLLOWING SCHEDULE IS PROVIDED TO FURTHER EXPLAIN THE IMPACT OF THIS TRANSACTION: ADD: UNBILLED REVENUE 12/31/23 $ 1,375,438 LESS: UNBILLED REVENUE 12/31/22 (1,389,915) (A) - NET INCREASE EQUALS NET INCOME ON PAGE I, LINE 19 $ (14,477) (B) - BENEFITS PAID TO MEMBERS (I.E. PATRONAGE DIVIDENDS), PART I, LINE 14 $11,209,022 TOTAL 2023 NET MARGIN (A + B) $11,194,545 FORM 990, PART VI, SECTION A, LINE 1A THE COOPERATIVE HAD 9 BOARD MEMBERS AT YEAR END; ALL 9 ARE ALLOWED TO VOTE, HOWEVER, THE BOARD CHAIRMAN VOTES ONLY IN THE CASE OF A TIE. FORM 990, PART VI, SECTION A, LINE 4 THE BYLAWS OF THE COOPERATIVE WERE AMENDED DURING THE YEAR - ARTICLE IV DIRECTORS, SECTION 4.02. QUALIFICATIONS, HAS BEEN AMENDED TO SAY, "WHILE A DIRECTOR, NOT BE A CLOSE RELATIVE OF AN INCUMBENT DIRECTOR OR BE IN A PARENT/CHILD OR SPOUSAL RELATIONSHIP WITH AN EMPLOYEE OF THE COOPERATIVE." FORM 990, PART VI, SECTION A, LINE 6 THE COOPERATIVE WAS FORMED BY THE MEMBERS TO PROVIDE ELECTRIC SERVICE AT COST ON A COOPERATIVE BASIS. FORM 990, PART VI, SECTION A, LINE 7A THE MEMBERS OF THE COOPERATIVE VOTE ON THE BOARD OF DIRECTORS. ELECTIONS ARE DONE ON A ONE MEMBER ONE VOTE BASIS PER DISTRICT. FORM 990, PART VI, SECTION A, LINE 7B THE FOLLOWING ACTS REQUIRE APPROVAL OF THE MEMBERS OF THE COOPERATIVE: 1. DISSOLUTION/LIQUIDATION OF THE COOPERATIVE 2. MERGER OR CONSOLIDATION OF THE COOPERATIVE WITH ANOTHER ORGANIZATION 3. DISPOSAL OF A SUBSTANTIAL PORTION OF THE COOPERATIVE'S ASSETS 4. AMENDMENT TO THE ARTICLES OF INCORPORATION FORM 990, PART VI, SECTION A, LINE 8B THE COOPERATIVE HAS NO COMMITTEES WITH AUTHORITY TO ACT ON BEHALF OF THE GOVERNING BODY. THEREFORE, AND PURSUANT TO FORM 990 INSTRUCTIONS, THE QUESTION HAS BEEN ANSWERED "NO". FORM 990, PART VI, SECTION B, LINE 11B MANAGEMENT PRESENTED A COPY OF THE FORM 990 TO THE BOARD FOR DISCUSSION AND REVIEW PRIOR TO FILING. FORM 990, PART VI, SECTION B, LINE 12C THE BOARD OF DIRECTORS AND OFFICERS ARE REQUIRED TO REVIEW AND BE FAMILIAR WITH THE POLICIES OUTLINED IN THE COOPERATIVE'S CONFLICT OF INTEREST POLICY. THE BOARD OF DIRECTORS AND OFFICERS ARE REQUIRED TO DISCLOSE ANY ACTION OR SITUATION THAT MIGHT VIOLATE THE POLICY TO THE FULL BOARD OF DIRECTORS AS SOON AS POSSIBLE. THE CONFLICT OF INTEREST POLICY IS REVIEWED ON AN ANNUAL BASIS. FORM 990, PART VI, SECTION B, LINE 14: THE COOPERATIVE DOES NOT HAVE A WRITTEN DOCUMENT RETENTION AND DESTRUCTION POLICY IN PLACE, BUT FOLLOWS THE RUS RECOMMENDATIONS REGARDING DOCUMENT RETENTION AND DESTRUCTION. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF DIRECTORS AND A COMPENSATION COMMITTEE COMPARE FORMS 990 OF OTHER COOPERATIVES AND USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE PRESIDENT/GM. THE SURVEY SHOWS COMPARATIVE SALARIES FOR GENERAL MANAGERS FROM COOPERATIVES LOCATED IN TEXAS AND THE NATION. THE PRESIDENT/GM UTILIZES AN INDEPENDENT COMPENSATION CONSULTANT, FORMS 990 OF OTHER COOPERATIVES, AND A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEES, IF ANY. THE SURVEY INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT TEXAS AND THE NATION. FORM 990, PART VI, SECTION C, LINE 19 THE COOPERATIVE PROVIDES A SUMMARIZED COPY OF THE AUDITED FINANCIAL STATEMENTS TO THE MEMBERS OF THE COOPERATIVE AT THE ANNUAL MEETING. THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF THE AUDITED FINANCIAL STATEMENTS, CONFLICT OF INTEREST POLICY, OR GOVERNING DOCUMENTS TO ANY MEMBER WHO REQUESTS A COPY. FINALLY, THE COOPERATIVE'S FINANCIAL STATEMENTS, GOVERNING DOCUMENTS, AND BYLAWS CAN BE FOUND ON ITS WEBSITE. FORM 990, PART VII, COLUMN F: IN ORDER TO PROVIDE RETIREMENT BENEFITS TO ITS EMPLOYEES, THE COOPERATIVE HAS ESTABLISHED A DEFINED CONTRIBUTION PLAN UNDER SECTION 401(K) OF THE INTERNAL REVENUE CODE. EMPLOYER CONTRIBUTIONS TO THE PLAN ARE MADE PURSUANT TO THE PLAN DOCUMENT. ADDITIONALLY, THE COOPERATIVE PARTICIPATES IN A MULTI-EMPLOYER DEFINED BENEFIT PLAN. CONTRIBUTIONS TO THIS PLAN ARE BASED ON THE FULL FUNDING LIMITATION OF SUCH PLAN. EMPLOYER CONTRIBUTIONS FOR BOTH PLANS ARE AVAILABLE TO PARTICIPATING EMPLOYEES, INCLUDING OFFICERS, KEY EMPLOYEES AND HIGHLY COMPENSATED EMPLOYEES, MEETING THE ELIGIBILITY REQUIREMENTS OF SUCH PLANS. THE COOPERATIVE ALSO PROVIDES HEALTH, DENTAL, VISION AND LIFE INSURANCE TO ALL ELIGIBLE EMPLOYEES THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICERS, KEY EMPLOYEES AND HIGHLY COMPENSATED EMPLOYEES IS COMPRISED OF ACTUARIAL INCREASE IN THE DEFINED BENEFIT PLAN, THE TOTAL AMOUNT CONTRIBUTED BY THE COOPERATIVE TO THE DEFINED CONTRIBUTION PLAN AND INSURANCE PAID ON BEHALF OF AND FOR THEIR BENEFIT. IN ADDITION TO THE ABOVE PENSION PLANS, THE COOPERATIVE ALSO PROVIDES POST-RETIREMENT HEALTH INSURANCE BENEFITS THROUGH AN UNFUNDED WELFARE BENEFIT PLAN. THE VALUE OF THESE BENEFITS HAS NOT BEEN ESTIMATED. FORM 990, PART VIII, LINE 2: PATRONAGE DIVIDENDS RESULT FROM THE PURCHASE OF WHOLESALE POWER FROM A GENERATION & TRANSMISSION COOPERATIVE. PATRONAGE DIVIDENDS ALSO RESULT FROM THE PAYMENT OF INTEREST FROM COOPERATIVE BANKS AND THE PURCHASE OF SUPPLIES AND SERVICES FROM OTHER COOPERATIVE ORGANIZATIONS. THE EXPENSES ASSOCIATED WITH PURCHASES FROM AND PAYMENTS TO SUCH COOPERATIVE ORGANIZATIONS ARE A DIRECT COMPONENT OF COST OF THE ELECTRIC SERVICE PROVIDED BY THE COOPERATIVE TO ITS MEMBERS. FORM 990, PART IX: ALTHOUGH THE COOPERATIVE IS NO LONGER A RURAL UTILITIES SERVICE (RUS) BORROWER, ITS ACCOUNTING RECORDS ARE MAINTAINED IN ACCORDANCE WITH THE RUS UNIFORM SYSTEM OF ACCOUNTS (USOA) AS PRESCRIBED FOR RUS ELECTRIC BORROWERS. THE USOA DOES NOT RECORD EXPENSES IN THE GENERAL EXPENSE CATEGORIES PROVIDED ON PART IX LINES 1-23. THE COOPERATIVE SEPARATELY REPORTS SALARIES AND WAGES, EMPLOYEE BENEFITS AND PAYROLL TAXES THAT ARE ALLOCATED IN ACCORDANCE WITH THEIR ACCOUNTING SYSTEM, BUT OTHER EXPENSES THAT ARE DESCRIBED IN LINES 1-23 ARE REPORTED ON LINE 24 UNDER THE EXPENSE CATEGORIES REQUIRED BY THE USOA. FORM 990, PART IX, LINES 5-7: SALARIES AND WAGES ARE ALLOCATED TO ASSET, LIABILITY, AND EXPENSE ACCOUNTS BASED ON THE ACCOUNTING SYSTEM DESCRIBED ABOVE. THE FOLLOWING SCHEDULE RECONCILES AMOUNTS REPORTED ON LINES 5-7 TO TOTAL WAGES ACCRUED AND/OR PAID. TOTAL PER LINES 5-7 $ 5,892,826 LESS: DIRECTORS FEES REPORTED ON FORM 1099-NEC (206,700) LESS: OFFICER & KEY EMPLOYEE BENEFITS INCLUDED IN LINE 5 (375,330) PLUS: SALARIES & WAGES ALLOCATED TO POWER 52,023 PLUS: SALARIES & WAGES CAPITALIZED DIRECTLY TO PLANT 3,471,758 PLUS: SALARIES & WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING AND OTHER ACCOUNTS 444,737 TOTAL WAGES ACCRUED AND/OR PAID $ 9,279,314 FORM 990, PART IX, LINE 24E: OTHER EXPENSES IS COMPRISED OF THE FOLLOWING: TAXES - PROPERTY & OTHER $ 510,272 TRANSMISSION 86,506 TOTAL OTHER EXPENSES PER FORM 990, LINE 24E $ 596,778 FORM 990, PART IX, LINE 4: PURSUANT TO THE FORM 990 INSTRUCTIONS, THE AMOUNT OF PATRONAGE DIVIDENDS PAID TO THE MEMBERS (HEREINAFTER REFERRED TO AS "PATRONS") SHOULD BE REPORTED ON PART IX, LINE 4. THE PHRASE "PATRONAGE DIVIDENDS PAID" REFERS TO THE PROCESS, SUBSEQUENT TO YEAR-END, BY WHICH THE COOPERATIVE ALLOCATES PATRONAGE CAPITAL TO AND, THEREFORE, OPERATES AT COST WITH ITS PATRONS. THE COOPERATIVE'S TAX EXEMPT PURPOSE IS TO PROVIDE ELECTRICITY TO ITS PATRONS AND TO DO SO ON A COOPERATIVE BASIS. TAX LAW DEFINES "OPERATING ON A COOPERATIVE BASIS" AS SUBORDINATION OF CAPITAL, DEMOCRATIC CONTROL, AND OPERATION AT COST. THE COOPERATIVE OPERATES AT COST THROUGH THE ALLOCATION OF TRUE PATRONAGE DIVIDENDS (ALSO REFERRED TO AS ALLOCATIONS OF PATRONAGE CAPITAL) TO ITS PATRONS. PATRONAGE DIVIDENDS ARE CONSIDERED PAID IF THE ALLOCATION IS MADE (1) PURSUANT TO A PRE-EXISTING OBLIGATION, (2) FROM THE MARGINS PRODUCED FROM THE TRANSACTIONS DONE WITH OR FOR PATRONS, AND (3) IN A FAIR AND EQUITABLE MANNER ON THE BASIS OF PATRONAGE (I.E. PURCHASES). ADDITIONALLY, THE ALLOCATION OF PATRONAGE DIVIDENDS SHOULD BE MADE WITHIN A REASONABLE TIME PERIOD AFTER THE CLOSE OF THE COOPERATIVE'S YEAR-END OF DECEMBER 31. EACH ONE OF THESE REQUIREMENTS FOR A TRUE PATRONAGE DIVIDEND IS PROVIDED FOR IN THE NON-PROFIT OPERATION ARTICLE OF THE COOPERATIVE'S BYLAWS. THE AMOUNT REPORTED ON PART IX, LINE 4 REPRESENTS THE AMOUNT OF PATRONAGE CAPITAL THAT IS EITHER ALLOCATED OR TO BE ALLOCATED TO THE PATRONS RESULTING FROM THEIR PURCHASE OF ELECTRICITY FROM THE COOPERATIVE FOR THE 2023 CALENDAR YEAR. BECAUSE PATRONAGE DIVIDENDS IS THE PROCESS BY WHICH THE COOPERATIVE OPERATES AT COST WITH ITS PATRONS AND THEREBY A KEY COMPONENT TO ACCOMPLISHING ITS EXEMPT PURPOSE, THE COOPERATIVE HAS REPORTED SUCH AMOUNTS AS AN EXPENSE FOR FORM 990 REPORTING. PATRONAGE ARE NOT AN EXPENSE FOR FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, HOWEVER. FORM 990, PART IX, LINE 24: ADMINISTRATIVE & GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS, & OTHER $ 1,182,860 OFFICE SUPPLIES 271,109 OUTSIDE SERVICES EMPLOYED 83,934 REGULATORY COMMISSION 166,691 DUPLICATE CHARGES (CREDIT) (110,102) DIRECTORS 286,202 DUES PAID TO ASSOCIATED ORGANIZATIONS 95,588 MISCELLANEOUS GENERAL 795,744 MAINTENANCE OF GENERAL PLANT 294,944 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 3,066,970 LESS: RECLASS OF DONATIONS TO PART IX, LINE 1 (72,183) LESS: RECLASS OF DIRECTOR FEES TO PART IX, LINE 5 (206,700) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (1,218,555) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (574,278) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 995,254 FORM 990, PART IX, LINE 1: ALL GRANTS, SPONSORSHIPS, AND/OR DONATIONS ARE MADE TO NON-PROFIT AND CIVIC ORGANIZATIONS THAT ARE LOCATED IN THE COOPERATIVE'S SERVICE AREA, AND ARE INTENDED TO IMPROVE THE COMMUNITIES IN WHICH OUR MEMBERS RESIDE. FORM 990, PART XI, LINE 9: PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 11,209,022. PATRONAGE CAPITAL RETIRED - TOTAL -2,659,171. PATRONAGE CAPITAL RETIRED - DISCOUNT 706,600. NET CHANGE IN MEMBERSHIPS -1,740. OTHER COMPREHENSIVE INCOME-PROVISION FOR POST-RETIREMENT BENEFIT OBLIGATION 69,952.