2024-11-14T14:40:18-06:00 2023-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2023-01-01 743023938 GUADALUPE VALLEY ELECTRIC COOPERATIVE INC GUAD 8308571200 PO BOX 118 GONZALES TX 78629 DARREN SCHAUER CEO 8308571200 2024-11-14 1 0 WILLIAM M MILLER P00439459 8067473806 2024-11-14 X 2023 2024-10-15 13:58:12Z DARREN SCHAUER PO BOX 118 GONZALES TX 78629 344423724 0 X WWW.GVEC.ORG X 1938 TX TO PROVIDE RELIABLE ELECTRIC & INTERNET SERVICE ON A COOPERATIVE BASIS. 11 10 455 0 12856450 516212 0 0 327990887 336357437 676318 1418928 4849313 6630573 333516518 344406938 121214 18982 23699117 24444968 29226238 32009008 0 0 0 276650437 288033823 329697006 344506781 3819512 -99843 960046886 1019194887 565035727 597680433 395011159 421514454 BUILDING ON OUR HERITAGE AND HAVING CONFIDENCE IN THE FUTURE, GUADALUPE VALLEY ELECTRIC COOPERATIVE IS A TEAM OF PROFESSIONALS COMMITTED TO EXCEEDING EXPECTATIONS BY IDENTIFYING AND INVESTING IN PRODUCTS & SERVICES THAT EMPOWER THE PEOPLE AND COMMUNITIES WE SERVE. 0 0 ELECTRIC DIVISION:SALE OF ELECTRIC POWER TO MEMBERS ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. THERE WERE 99,680 ACTIVE SERVICES AT YEAR END. INTERNET/BROADBAND SERVICE DIVISION:PROVIDING FIBER INTERNET SERVICES TO ITS MEMBERS THROUGH A COMBINATION OF WIRELESS AND FIBER-TO-THE-HOME TECHNOLOGIES. SERVICES OF THIS DIVISION WILL BE PROVIDED TO MEMBERS ON A PATRONAGE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL TO THE EXTENT OF MARGINS FOR SUCH DIVISION. FIBER AND WIRELESS INTERNET IS ALSO PROVIDED TO NON-MEMBERS ON A NON-PATRONAGE BASIS. 0 0 0 0 0 0 0 1 0 1 0 0 0 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 1 0 0 0 0 0 1 1 1 1 0 1 213 0 455 1 1 1 0 0 0 0 320859886 21799062 0 0 0 X 11 10 1 0 0 0 1 1 1 1 0 0 0 0 1 1 1 1 0 1 1 0 X GARY KORN CFO 8308571200 825 E SARAH DEWITT DR GONZALES TX 78629 X GARY BIRDWELL PRESIDENT 10.00 2.00 X X 53106 0 0 LEWIS BORGFELD DIRECTOR 8.30 3.00 X 42297 0 0 MORRIS HARVEY SECRETARY/TREASURER 7.40 2.00 X X 39156 0 0 SHAWN MARTINEZ DIRECTOR 5.00 2.00 X 34802 0 0 MARK ROBERTS DIRECTOR 6.50 2.00 X 35922 0 0 HENRY SCHMIDT VICE PRESIDENT 9.00 3.00 X X 39156 0 0 MELVIN STREY DIRECTOR 10.00 3.00 X 29458 0 0 DAVID WARZECHA DIRECTOR 4.40 2.00 X 25197 0 0 ROBERT WERNER DIRECTOR 5.00 2.00 X 30156 0 0 DON WILLIAMS DIRECTOR 6.30 3.00 X 33750 0 0 LEO YORK DIRECTOR 7.80 2.00 X 47706 0 0 DARREN SCHAUER GM/CEO 60.00 1.00 X 806814 0 64479 SEAN ALVAREZ COO 50.00 1.00 X 505555 0 62967 GARY KORN CFO 48.00 1.00 X 351166 0 55907 ASHLEY COBURN CPO 45.00 X 288502 0 58257 CEASON BARNICK SR EXEC MGR - CUSTOMER RELATIONS 45.00 X 245795 0 53058 ROBERT CHRISTMAS SR EXEC MGR - COMPLIANCE 55.00 X 235603 0 47461 KRISTA DAVIS SR EXEC MGR - MARKETING 50.00 X 235377 0 51913 ROBERT RUSSELL EXEC ENGINEER - COMMUNICATION TECHNOLOGY 50.00 X 256376 0 36869 JEFFREY STRAHL EXEC MGR - INFORMATION TECHNOLOGY 55.00 X 239735 0 54025 WILLIAM NICHOLS EXEC MGR - POWER SUPPLY 50.00 X 221681 0 46896 ZACHARY TAYLOR EXEC MGR - ENGINEERING 50.00 X 208696 0 46534 RICHARD MCKINNEY EXEC MGR - OPERATIONS 48.00 X 194908 0 42710 4200914 0 621076 119 0 1 0 TLT CONSTRUCTION CO INC PO BOX 1086 SHERMAN TX 75091 LINE CONSTRUCTION 5778227 SOURCE POWER LLC PO BOX 691348 SAN ANTONIO TX 78269 OH CONSTRUCTION 5306313 B&M SERVICES 1303 EWALD RD NEW BRAUNFELS TX 78130 CABLE LAYING CONSTRUCTION 3481664 LAMBDA CONSTRUCTION LTD 211 JESSES CIRCLE NEW BRAUNFELS TX 78132 LINE CONSTRUCTION 3363805 AMP UTILITY COMPANY LLC 518 S ENTERPRIZE PKWY CORPUS CHRISTI TX 78405 LINE CONSTRUCTION 3092929 33 X SALES OF ELECTRICITY 221000 285919886 285919886 SALES FROM INTERNET OPERATIONS 517000 23375079 16263506 7111573 TRANSMISSION ACCESS 221000 16769447 16769447 PATRONAGE DIVIDENDS 221000 4800702 4800702 SERVICE FEES & OTHER CHARGES 221000 2841946 2841946 2650377 2650377 336357437 1290968 1290968 144746 16786 127960 127960 126889 1071 INTERCOMPANY MANAGEMENT INCOME 561000 5267737 5267737 POLE ATTACHMENT INCOME 221000 688843 688843 MAINTENANCE REVENUE 561000 476069 476069 197924 197924 6630573 344406938 329570677 12856450 1979811 X 18982 24444968 3473560 21567254 2092714 3141351 1734129 14775480 39719176 PURCHASED POWER 206281405 ADMIN & GENERAL EXPENSE 11459293 INTERNET EXPENSE 6132985 UBI TAX 104419 9561065 344506781 20129184 22275882 271799 34477 21767319 19948946 4485698 3531528 103499 173665 184802461 189848153 1108558980 357912322 697439627 750646658 16326230 18032960 3198584 3177378 11522485 11525240 960046886 1019194887 37610053 25064746 90362 46111 506207770 551602331 21127542 20967245 565035727 597680433 X 6010181 32845667 0 0 389000978 388668787 395011159 421514454 960046886 1019194887 X -99843 26603138 X X 0 1 X 0 0 0 1 X 27549142 27549142 81177954 55070723 26107231 884792487 302841599 581950888 115039397 115039397 750646658 DEFERRED CREDITS - ADVANCES FOR CONSTRUCTION 3828971 CONSUMER DEPOSITS 3399036 ACCRUED OPERATING TAXES 2953222 ACCUMULATED PROVISION FOR POST RETIREMENT BENEFITS 9280590 ACCUMULATED DEFERRED FIT/UBIT 1062102 OTHER DEFERRED CREDITS AND LIABILITIES 443324 20967245 X 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. ALSO PURSUANT TO SECTION 74.3013 OF THE TEXAS PROPERTY CODE, THE COOPERATIVE HAS ESTABLISHED AN ECONOMIC DEVELOPMENT FUND WITH RETIREMENTS OF PATRONAGE CAPITAL, WHICH HAVE REMAINED UNCLAIMED FOR A PERIOD OF THREE YEARS. THE AMOUNTS DEPOSITED INTO THE ECONOMIC DEVELOPMENT FUND ARE APPROVED BY THE STATE OF TEXAS AND CAN ONLY BE USED FOR THE STIMULATION AND IMPROVEMENT OF BUSINESS AND COMMERCIAL ACTIVITY FOR ECONOMIC DEVELOPMENT IN RURAL COMMUNITIES. ANY AMOUNTS SO DEPOSITED INTO THE ECONOMIC DEVELOPMENT FUND ARE STILL PAYABLE TO THE PERSON TO WHOM THE ORIGINAL PAYMENT WAS MADE BUT UNCLAIMED. PART X, LINE 2: THE COOPERATIVE AND ITS AFFILIATES FOLLOW 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 AND AFFILIATES DETERMINED THAT IT IS MORE LIKELY THAN NOT THAT THEIR TAX POSITIONS WILL BE SUSTAINED UPON EXAMINATION BY THE INTERNAL REVENUE SERVICE OR OTHER STATE TAXING AUTHORITY AND THAT ALL TAX BENEFITS ARE LIKELY TO BE REALIZED UPON SETTLEMENT WITH TAXING AUTHORITIES. PART VIII: THE AMOUNT OF INVESTMENTS - PROGRAM RELATED ON FORM 990, PAGE 11, PART X, LINE 13 DOES NOT EQUAL OR EXCEED 5 PERCENT OF THE TOTAL ASSETS ON FORM 990, PAGE 11, PART X, LINE 16, COLUMN B. CONSEQUENTLY, IN ACCORDANCE WITH IRS INSTRUCTIONS, SCHEDULE D, PART VIII HAS BEEN LEFT BLANK. PART IX: THE AMOUNT OF OTHER ASSETS ON FORM 990, PAGE 11, PART X, LINE 15 DOES NOT EQUAL OR EXCEED 5 PERCENT 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. X X X X 0 0 0 DARREN SCHAUER GM/CEO 565094 0 166166 0 75554 0 33000 0 31479 0 871293 0 0 0 SEAN ALVAREZ COO 390750 0 84325 0 30480 0 33000 0 29967 0 568522 0 0 0 GARY KORN CFO 290168 0 42504 0 18494 0 33000 0 22907 0 407073 0 0 0 ASHLEY COBURN CPO 240060 0 35712 0 12730 0 28644 0 29613 0 346759 0 0 0 CEASON BARNICK SR EXEC MGR - CUSTOMER RELATIONS 210197 0 21641 0 13957 0 24300 0 28758 0 298853 0 0 0 JEFFREY STRAHL EXEC MGR - INFORMATION TECHNOLOGY 205159 0 20927 0 13649 0 23837 0 30188 0 293760 0 0 0 ROBERT RUSSELL EXEC ENGINEER - COMMUNICATION TECHNO 219534 0 21652 0 15190 0 24760 0 12109 0 293245 0 0 0 KRISTA DAVIS SR EXEC MGR - MARKETING 195703 0 26996 0 12678 0 23267 0 28646 0 287290 0 0 0 ROBERT CHRISTMAS SR EXEC MGR - COMPLIANCE 193806 0 22201 0 19596 0 22981 0 24480 0 283064 0 0 0 WILLIAM NICHOLS EXEC MGR - POWER SUPPLY 201078 0 20052 0 551 0 22868 0 24028 0 268577 0 0 0 ZACHARY TAYLOR EXEC MGR - ENGINEERING 177886 0 18205 0 12605 0 20363 0 26171 0 255230 0 0 0 RICHARD MCKINNEY EXEC MGR - OPERATIONS 161361 0 16756 0 16791 0 19093 0 23617 0 237618 0 0 0 LEWIS BORGFELD FAMILY RELATIONSHIP - EMPLOYEE OFFICER (S. ALVAREZ) 42297 DIRECTOR 0 SEAN ALVEREZ FAMILY RELATIONSHIP - DIRECTOR (L. BORGFELD) 505555 EMPLOYMENT 0 FORM 990, PART I, LINE 19: REVENUE LESS EXPENSES AS REPORTED ON PAGE 1, PART I, LINE 19 DIFFERS FROM THE TOTAL NET MARGINS REPORTED ON THE COOPERATIVE'S AUDITED FINANCIAL STATEMENTS DUE TO BOOK TO TAX ADJUSTMENTS REQUIRED TO CONFORM TO THE FORM 990 INSTRUCTIONS. ONE SUCH ADJUSTMENT, THE EQUITY METHOD INCOME IS RECORDED ON THE COOPERATIVE'S BOOKS AND INCLUDED IN TOTAL NET MARGINS. U.S. GAAP REQUIRES THE COOPERATIVE TO RECORD ON ITS BOOKS THE EQUITY METHOD INCOME FROM ITS WHOLLY OWNED SUBSIDIARY. EQUITY METHOD INCOME IS NOT INCOME FOR IRS FORM 990 PURPOSES AND AS SUCH HAS BEEN REPORTED AS AN OTHER CHANGE IN NET ASSETS. NON-REFUNDABLE AID TO CONSTRUCTION AND OTHER ADJUSTMENTS REQUIRED FOR THE CALCULATION OF UNRELATED BUSINESS INCOME ARE OTHER BOOK-TAX ADJUSTMENTS INCLUDED IN THE FORM 990. FORM 990, PART VI, SECTION A, LINE 1A THE COOPERATIVE HAS 11 BOARD MEMBERS; ALL 11 ARE ALLOWED TO VOTE; HOWEVER, THE BOARD CHAIRMAN VOTES ONLY IN THE CASE OF A TIE. PER IRS FORM 990 INSTRUCTIONS, DIRECTOR BORGFELD IS NOT AN INDEPENDENT DIRECTOR DUE TO A FAMILY RELATIONSHIP WITH AN EMPLOYEE OF THE COOPERATIVE. FORM 990, PART VI, SECTION A, LINE 2 A FAMILY RELATIONSHIP EXISTS BETWEEN DIRECTOR LEWIS BORGFELD AND OFFICER SEAN ALVAREZ. 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 BY 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 REVIEWED THE FORM 990 PRIOR TO FILING AND PRESENTED A COPY OF THE RETURN TO THE BOARD SUBSEQUENT TO FILING. FORM 990, PART VI, SECTION B, LINE 12C THE COOPERATIVE DOES NOT HAVE A FORMAL CONFLICT OF INTEREST POLICY, HOWEVER, LIMITATIONS ON THE BOARD OF DIRECTORS ARE DEFINED IN THE COOPERATIVE'S BYLAWS. THE ORGANIZATION REGULARLY AND CONSISTENTLY MONITORS AND ENFORCES COMPLIANCE WITH SUCH POLICIES. A QUESTIONNAIRE WAS ANSWERED BY ALL BOARD MEMBERS. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF DIRECTORS USE A COMPENSATION SURVEY AND COMPARE COMPENSATION REPORTED ON OTHER COOPERATIVES' IRS FORMS 990 WHEN DETERMINING THE COMPENSATION OF THE CEO. THE SURVEY SHOWS COMPARATIVE SALARIES FOR GENERAL MANAGERS/CEOS FROM SIMILARLY SITUATED COOPERATIVES LOCATED IN TEXAS AND THE NATION. THE BOARD AND THE CEO USE THE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE COOPERATIVES' OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEES, IF ANY. THE SURVEY INCLUDES SALARIES FROM SIMILARLY SITUATED COOPERATIVES THROUGHOUT TEXAS AND THE NATION. FORM 990, PART VI, SECTION C, LINE 19 THE COOPERATIVE'S BYLAWS, ANNUAL REPORT AND FINANCIAL STATEMENTS ARE AVAILABLE ON ITS WEBSITE AT WWW.GVEC.ORG. 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. EMPLOYER CONTRIBUTIONS TO THE PLAN 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 AND LIFE INSURANCE TO ALL EMPLOYEES THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICERS, KEY AND HIGHLY COMPENSATED EMPLOYEES ARE COMPRISED OF THE TOTAL AMOUNT CONTRIBUTED TO THE 401(K) PENSION PLAN AND THE INSURANCE PREMIUMS PAID 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 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: THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE RUS UNIFORM SYSTEM OF ACCOUNTS (USOA) AS PRESCRIBED BY THE FEDERAL ENERGY REGULATORY COMMISSION FOR CLASS A AND B ELECTRIC UTILITIES. 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 ITS 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 $25,040,814 LESS: DIRECTOR FEES REPORTED ON FORMS 1099-NEC (410,706) LESS: EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (241,610) LESS: KEY EMPLOYEE BENEFITS INCLUDED IN LINE 5 (152,432) PLUS: SALARIES & BENEFITS ALLOCATED TO PURCHASED POWER 788,185 PLUS: SALARIES & WAGES CAPITALIZED DIRECTLY TO PLANT 8,891,625 PLUS: SALARIES & WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 2,402,884 TOTAL WAGES ACCRUED AND/OR PAID $36,318,760 FORM 990, PART IX, LINE 24: ADMINISTRATIVE AND GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS & OTHER $ 4,444,771 OFFICE SUPPLIES 1,578,530 OUTSIDE SERVICES EMPLOYED 912,411 INJURIES & DAMAGES 1,746,221 PENSIONS & BENEFITS 3,586,707 REGULATORY COMMISSION 1,081,369 ADVERTISING 1,338,839 MISCELLANEOUS GENERAL 619,467 DISTRICT & ANNUAL MEETINGS 316,106 DUES TO ASSOCIATED ORGANIZATIONS 148,277 DIRECTORS 331,451 UTILITIES 560,247 MAINTENANCE OF GENERAL PLANT 2,273,592 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $18,937,988 LESS: RECLASS OF DIRECTOR FEES TO PART IX, LINE 5 (410,706) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (5,421,185) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (1,646,804) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $11,459,293 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 ARE 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 DIVIDENDS ARE NOT AN EXPENSE FOR FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, HOWEVER. FORM 990, PART IX, LINE 24E: OTHER EXPENSES IS COMPRISED OF THE FOLLOWING: CONSUMER EXPENSE $ 2,122,440 DISTRIBUTION EXPENSE 5,600,381 INTERCOMPANY MANAGEMENT SERVICES EXPENSE 1,165,117 OTHER DEDUCTIONS 147,846 TRANSMISSION EXPENSE 525,281 TOTAL OTHER EXPENSES PER FORM 990, PART IX $ 9,561,065 FORM 990, PART XI, LINE 9: PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 24,444,968. PATRONAGE CAPITAL RETIRED - TOTAL -164,301. PATRONAGE CAPITAL RETIRED - DISCOUNT 1,958. OCI - PENSION & BENEFITS 2,173,298. EQUITY METHOD INCOME FROM SUBSIDIARIES 471,377. NET CHANGE IN MEMBERSHIPS 51,796. PATRONAGE CAPITAL ESCHEATED -4,424. UBI BOOK-TAX DIFFERENCE - CONTRIBUTIONS IN AID OF CONSTRUCTION & OTHER ADJ -371,534. GVECNET LLC PO BOX 525 GONZALES TX 78629 INACTIVE TX 0 0 GUADALUPE VALLEY ELECTRIC COOPERATIVE INC GVDC LLC PO BOX 1546 GONZALES TX 78629 INVESTMENT COMPANY TX 1398 1876810 GUADALUPE VALLEY ELECTRIC COOPERATIVE INC GVEC CHARITABLE FOUNDATION 825 E SARAH DEWITT DR GONZALES TX 78629 453420216 TO PROVIDE FUNDING FOR LOCAL NON-PROFITS AND NEEDY INDIVIDUALS TX 501(C)(3) 7 GUADALUPE VALLEY ELECTRIC COOPERATIVE INC 1 GVEC HOME SERVICES INC PO BOX B GONZALES TX 78629 742766073 HVAC, SOLAR & ELECTRICIAN SALES AND SERVICES TX GUADALUPE VALLEY ELECTRIC COOPERATIVE INC C 4351024 4625516 1.00000 1 1 0 0 0 0 0 0 0 0 0 0 0 0 1 1 0 1 0 0 GVEC CHARITABLE FOUNDATION N N/A - LESS THAN $50,000 GVEC CHARITABLE FOUNDATION O N/A - LESS THAN $50,000 GVEC HOME SERVICES INC A 217535 INTEREST GVEC HOME SERVICES INC N 5865562 INVOICES & OTHER RECORDS GVEC HOME SERVICES INC Q 5831696 INVOICES & OTHER RECORDS