2024-11-15T23:48:47-06:00 2023-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2023-01-01 750594971 SWISHER ELECTRIC COOPERATIVE INC SWIS 8069953567 PO BOX 67 TULIA TX 79088 DWAIN TIPTON GENERAL MANAGER 8069953567 2024-11-15 1 0 WILLIAM M MILLER P00439459 8067473806 2024-11-15 X 2023 2024-10-15 13:58:12Z DWAIN TIPTON PO BOX 67 TULIA TX 79088 29902050 0 X WWW.SWISHERELECTRIC.ORG X 1939 TX TO PROVIDE QUALITY AND RELIABLE ELECTRIC SERVICE TO MEMBERS OF THE COOPERATIVE. 7 7 44 0 7380 0 0 0 25204535 29000416 191391 656588 13942 24882 25409868 29681886 9755 12954 501576 4514774 3317299 3284275 0 0 0 21366832 21335675 25195462 29147678 214406 534208 71325380 74088466 31227096 29752037 40098284 44336429 X TO SUPPLY THE PRESENT AND FUTURE ELECTRICAL SERVICE NEEDS TO ITS MEMBERS IN AN EFFICIENT AND ECONOMICAL MANNER AND TO HAVE A SOUND FINANCIAL BASE IN ORDER TO PROVIDE THE HIGHEST RELIABILITY OF SERVICE WITH INTEGRITY, INNOVATION, ACCOUNTABILITY AND COMMITMENT TO COMMUNITY THEREBY ENHANCING THE QUALITY OF LIFE FOR ALL OUR MEMBERS. 0 0 PROVIDING ELECTRIC ENERGY TO OUR MEMBERS ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. THERE WERE 7,930 ACTIVE SERVICES AT YEAR END. 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 0 0 1 0 0 0 0 0 0 0 0 0 0 1 0 0 0 1 63 0 44 1 1 1 0 0 0 0 27409111 1468619 0 0 0 X 7 7 0 0 0 0 1 1 1 1 0 0 0 1 1 1 1 1 1 1 1 0 X JASMINE DICKSON DIRECTOR OF FIN & OFFICE SERVICES 8069953567 401 SW 2ND STREET TULIA TX 79088 X JEFF HARRELL DIRECTOR 2.50 X 27874 0 0 DWAIN STRANGE PRESIDENT 1.33 X X 27392 0 0 BILLY COGDELL ASSISTANT SECRETARY/TREASU 1.00 X X 27389 0 0 RALPH FROST DIRECTOR 2.50 X 27389 0 0 MACE MIDDLETON VICE PRESIDENT 1.00 X X 27389 0 0 BRAD SHARP DIRECTOR 1.12 X 14536 0 0 JIMMY BURSON SECRETARY/TREASURER 0.62 X X 14254 0 0 DWAIN TIPTON GENERAL MANAGER 55.00 X 171319 0 139206 JASMINE DICKSON DIRECTOR OF FINANCE 40.00 X 109386 0 60348 MARY ELLEN MCMANUS DIRECTOR OF ENGINEERING & 40.00 X 167111 0 60256 614039 0 259810 3 0 1 0 VIZ ENGINEERING LLC 7717 MILWAUKEE AVE STE 500 103 LUBBOCK TX 79424 ENGINEER CONSULTING 111121 BRANDON & CLARK PO BOX 3159 LUBBOCK TX 79452 TRANSFORMER/RECLOSER REPAIR/DISPOSAL 100671 2 X SALES OF ELECTRICITY 221000 26153472 26153472 PATRONAGE DIVIDENDS 221000 2658310 2658310 SERVICE FEES 221000 89073 89073 OTHER PROGRAM REVENUE 221000 82161 82161 ELECTRIC WHEELING 221000 17400 17400 29000416 396817 396817 7380 0 7380 7380 7380 283744 23973 259771 259771 259771 200141 196191 3950 3950 POLE ATTACHMENT INCOME 221000 10965 10965 SCRAP SALES 221000 2587 2587 13552 29681886 29266724 7380 407782 X 12954 4514774 646482 1796272 288391 413088 140042 918100 1980023 PURCHASED POWER 16212346 DISTRIBUTION EXPENSE 949749 ADMIN & GENERAL EXPENSE 816449 OPERATING TAXES 186863 272145 29147678 701365 754723 2264635 2688497 1765463 1117039 700328 718799 3097946 2836940 72221774 33330096 38032002 38891678 24747310 27054076 16331 26714 71325380 74088466 1694348 1512363 105733 66006 73986 26059005 25032860 3302004 3132828 31227096 29752037 X 0 0 0 0 40098284 44336429 40098284 44336429 71325380 74088466 X 534208 3703937 X X 0 1 X 0 0 0 1 X 167225 167225 1801177 1086489 714688 271697 271697 69903767 32243607 37660160 77908 77908 38891678 PATRONAGE CAPITAL - TEC 425828 C PATRONAGE CAPITAL - CFC 402187 C PATRONAGE CAPITAL - GSEC 23511198 C PATRONAGE CAPITAL - NISC 48162 C PATRONAGE CAPITAL - OTHER 41708 C CAPITAL TERM CERTIFICATES - CFC 710598 C SCHOLARSHIP FUNDS & OPERATIONS RESERVE 1049902 C CFC MEMBER CAPITAL SECURITIES 500000 C PATRONAGE CAPITAL - FEDERATED RURAL INSURANCE EXCHANGE 181493 C MEDIUM TERM NOTES - CFC 183000 C 27054076 CONSUMER DEPOSITS 399301 DEFERRED CREDITS - OTHER 420579 DEFERRED CREDIT - UNCLAIMED CAPITAL CREDIT CHECKS 156655 DEFERRED CREDIT - OVERBILLED POWER COST 2108612 ACCRUED OPERATING TAXES 40010 OTHER LIABILITIES 7671 3132828 X 29702863 20977 20977 29681886 0 29681886 24653881 20977 20977 24632904 4514774 4514774 29147678 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 AMOUNTS DESIGNATED UNCLAIMED UNDER STATE LAW. 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 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 POSITION WILL BE SUSTAINED UPON EXAMINATION BY THE INTERNAL REVENUE SERVICE (IRS), OR OTHER STATE TAXING AUTHORITY AND THAT ALL TAX BENEFITS ARE LIKELY TO BE REALIZED UPON SETTLEMENT WITH TAXING AUTHORITIES. PART XI, LINE 2D - OTHER ADJUSTMENTS: RECLASSIFY NON-OPERATING EXPENSES TO PART IX 20,977. PART XII, LINE 2D - OTHER ADJUSTMENTS: RECLASSIFY NON-OPERATING EXPENSES TO PART IX 20,977. PART XII, LINE 4B - OTHER ADJUSTMENTS: PATRONAGE CAPITAL ASSIGNED OR TO BE ASSIGNED 4,514,774. PART IX: THE AMOUNT OF OTHER ASSETS ON FORM 990, PAGE 11, PART IX, 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 ALLOCATED OR TO BE 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". PATRONAGE DIVIDENDS ARE ALLOCATED ON A PATRONAGE BASIS AND DONE SO PURSUANT TO A PRE-EXISTING OBLIGATION AS PROVIDED FOR IN THE "NON-PROFIT OPERATION" ARTICLE OF THE COOPERATIVE'S BYLAWS. X 1 1 X 0 0 0 DWAIN TIPTON GENERAL MANAGER 163194 0 1416 0 6709 0 65566 0 73640 0 310525 0 0 0 MARY ELLEN MCMANUS DIRECTOR OF ENGINEERING & 114950 0 1285 0 50876 0 28991 0 31265 0 227367 0 0 0 JASMINE DICKSON DIRECTOR OF FINANCE 108526 0 568 0 292 0 14177 0 46171 0 169734 0 0 0 PART I, LINE 1A PURSUANT TO APPLICABLE TRAVEL POLICIES, THE COOPERATIVE WILL REIMBURSE DIRECTORS FOR THE COST OF HIS/HER SPOUSE TO ACCOMPANY HIM/HER ON OFFICIAL BUSINESS OF THE COOPERATIVE. 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 AND REPRESENT THE TRUE COST TO THE COOPERATIVE. DWAIN TIPTON: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 62,082 EMPLOYER CONTRIBUTION TO 401(K) PLAN 3,484 TOTAL REPORTED IN COLUMN C $ 65,566 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (62,082) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 38,334 EXPENSE TO THE COOPERATIVE $ 41,818 MARY ELLEN MCMANUS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 26,586 EMPLOYER CONTRIBUTION TO 401(K) PLAN 2,405 TOTAL REPORTED IN COLUMN C $ 28,991 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (28,991) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 25,486 EXPENSE TO THE COOPERATIVE $ 27,891 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. 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. THE 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 ON AN ANNUAL BASIS, THE COOPERATIVE WILL REQUIRE THE BOARD AND ITS EMPLOYEES TO COMPLETE AND SIGN A CONFLICT OF INTEREST CERTIFICATION AND DISCLOSURE FORM. THE BOARD WILL ALSO COMPLETE AND SIGN THE FORM 990 DISCLOSURE QUESTIONNAIRE. THE SIGNED COPIES WILL BE KEPT IN THE PERSONNEL FILE FOR EACH INDIVIDUAL. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF DIRECTORS DISCUSS AND EVALUATE THE PERFORMANCE OF THE GENERAL MANAGER FOR DETERMINING COMPENSATION. FORM 990, PART VI, SECTION C, LINE 19 A SUMMARY OF THE ANNUAL FINANCIAL STATEMENTS ARE HANDED OUT TO MEMBERS AT THE ANNUAL MEMBERSHIP MEETING. THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF THE AUDITED FINANCIAL STATEMENTS TO ANY MEMBER WHO REQUESTS A COPY. THE COOPERATIVE'S CONFLICT OF INTEREST POLICY IS AVAILABLE TO THE PUBLIC UPON REQUEST AT THE COOPERATIVE'S HEADQUARTERS. 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, 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 OFFICER IS COMPRISED OF THE 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 HIS 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 WILL BE ALLOCATED IN ACCORDANCE WITH THEIR ACCOUNTING SYSTEM, BUT OTHER EXPENSES THAT ARE DESCRIBED IN LINES 1-23 WILL BE 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 $ 2,442,754 LESS: DIRECTOR FEES REPORTED ON FORMS 1099-NEC (166,223) LESS: EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (199,554) PLUS: SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 411,913 PLUS: SALARIES AND WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 256,443 TOTAL WAGES ACCRUED AND/OR PAID $ 2,745,333 FORM 990, PART IX, LINE 24: ADMINISTRATIVE AND GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS, & OTHER $ 625,146 OFFICE SUPPLIES 32,611 SOFTWARE MAINTENANCE 179,044 OUTSIDE SERVICES EMPLOYED 101,855 INJURIES AND DAMAGES INSURANCE 114,084 EMPLOYEE PENSION & BENEFITS 8,886 DIRECTORS 174,723 DUES TO ASSOCIATED ORGANIZATIONS 46,697 EMPLOYEE TRAVEL 38,921 ADVERTISING 25,763 MISCELLANEOUS GENERAL 104,240 ANNUAL MEETING 37,939 COMMUNITY PUBLIC RELATIONS & AREA DEVELOPMENT 29,428 MEMBER SERVICES RELATIONS 31,143 MAINTENANCE OF GENERAL PLANT 119,468 REGULATORY COMMISSION 42,567 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 1,715,515 LESS: RECLASS OF DIRECTOR FEES TO PART IX, LINE 5 (166,223) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (488,157) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (244,686) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 816,449 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 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. EACH GRANT, SPONSORSHIP, AND/OR DONATION MADE DURING THE YEAR WAS BELOW THE REPORTING THRESHOLD OF SCHEDULE I, PART II. FORM 990, PART XI, LINE 9: PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 4,514,774. PATRONAGE CAPITAL RETIRED - TOTAL -1,013,511. PATRONAGE CAPITAL RETIRED - DISCOUNT 10,376. OTHER COMPREHENSIVE INCOME - PROVISION FOR PENSION & BENEFITS 192,298. FORM 990, PART XII, LINE 2C: THE BOARD AS A WHOLE IS RESPONSIBLE FOR OVERSEEING THE FINANCIAL STATEMENT AUDIT AND SELECTING THE INDEPENDENT FINANCIAL STATEMENT AUDITOR. PROCEDURAL CHANGES DID NOT OCCUR DURING THE YEAR. RURAL ENERGY SOLUTIONS LLC PO BOX 67 TULIA TX 79088 923942909 ENERGY SERVICES TX 82161 288693 SWISHER ELECTRIC COOPERATIVE INC