2024-11-15T23:10:19-06:00 2023-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2023-01-01 750300645 GRAYSON-COLLIN ELECTRIC COOPERATIVE INC GRAY 9034827100 PO BOX 548 VAN ALSTYNE TX 754950548 MIKE ROLANDT CFO 9034827100 2024-11-15 1 0 WILLIAM M MILLER P00439459 8067473806 2024-11-15 X 2023 2024-10-15 13:58:12Z DAVID MCGINNIS PO BOX 548 VAN ALSTYNE TX 754950548 199761252 0 X WWW.GCEC.NET X 1937 TX TO PROVIDE QUALITY AND RELIABLE ELECTRIC SERVICE TO MEMBERS OF THE COOPERATIVE. 5 5 147 0 0 0 0 0 202968382 197145641 1007991 1568307 1328797 1033585 205305170 199747533 63091 27424 8412374 3813798 11280745 12772351 0 0 0 183575918 180160981 203332128 196774554 1973042 2972979 551504092 646811614 403464195 497967270 148039897 148844344 TO PROVIDE THE VERY BEST SERVICE POSSIBLE AT THE LEAST COST POSSIBLE. 0 0 PROVIDING ELECTRIC ENERGY TO OUR MEMBERS ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. THERE WERE 84,009 ACTIVE SERVICES AT YEAR END. 0 0 0 0 0 0 0 1 0 1 0 1 0 1 1 0 1 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 1 0 0 0 0 0 0 1 1 1 0 1 14 0 147 1 0 0 0 0 0 193529390 14334319 0 0 0 X 5 5 0 0 0 0 1 1 1 1 0 0 0 1 0 1 0 1 1 0 X MIKE ROLANDT CFO 9034827113 14568 FM 121 VAN ALSTYNE TX 754950548 X STEVE ROBINSON PRESIDENT 4.00 1.00 X X 17732 0 0 PAUL KIRKLAND VICE PRESIDENT 4.00 X X 14167 0 0 JIM COPELAND SECRETARY/TREASURER 4.00 X X 43004 0 0 DAVID ELLIS DIRECTOR 4.00 1.00 X 42804 0 0 DENNIS FERGUSON DIRECTOR 4.00 X 17832 0 0 DAVID MCGINNIS GENERAL MANAGER/CEO 60.00 3.00 X 534884 0 59321 KEVIN STEVENS COO 60.00 X 288367 0 54079 CHRIS OFFILL CEO/CFO COMMUNICATIONS 50.00 X 241208 0 52082 MIKE ROLANDT CFO 45.00 X 243097 0 64988 TRACY BEGLEY MANAGER OF INSIDE OPERATIONS 45.00 X 241784 0 63809 PAUL YATES MANAGER OF UNDERGROUND OPERATIONS 40.00 X 226484 0 49291 JEFF SMITH MANAGER OF INFORMATION TECHNOLOGY 40.00 X 202614 0 48633 EDDY REECE MANAGER OF SUBSTATIONS 60.00 X 171272 0 58588 LESLIE SIMCO MANAGER OF OPERATIONS 45.00 X 192398 0 59714 MARTY JONES MANAGER OF OPERATIONS 55.00 X 177242 0 45902 MICHAEL LAUER MANAGER OF BUS. DEVELOPMENT 43.00 X 190327 0 47066 JASON SPROWL MANAGER OF OPERATIONS - LOSS CONTROL 43.00 X 188601 0 59392 WILLIAM MCGINNIS MANAGER OF BUS. DEVELOPMENT 50.00 X 184611 0 55059 MARC KARO FOREMAN 50.00 X 178769 0 54780 SHAWN WRIGHT LINE SUPERINTENDENT - SERVICE SUPERVISOR 40.00 X 170394 0 41441 3567591 0 814145 54 0 1 0 VAQUERO UNDERGROUND SERVICES LLC 404 N 8TH STREET GUNTER TX 75058 UNDERGROUND CONSTRUCTION 17635417 TECHLINE CONSTRUCTION LLC PO BOX 674086 DALLAS TX 75267 OVERHEAD CONSTRUCTION 5400798 NORTHSTAR ENERGY SOLUTIONS LLC PO BOX 847154 DALLAS TX 75284 SUBSTATION CONSTRUCTION 5284897 APEX LINE CLEARANCE LLC 2210 CR 219 GAINESVILLE TX 76240 TREE TRIMMING 3987380 LINETEC SERVICES LLC 19820 NORTH 7TH AVE STE 120 PHOENIX AZ 85027 OVERHEAD CONSTRUCTION 1688292 12 X SALES OF ELECTRICITY 221000 190303285 190303285 PATRONAGE DIVIDENDS 221000 5098803 5098803 ELECTRICITY WHEELING 221000 1743553 1743553 197145641 1434941 1434941 147369 0 147369 147369 147369 147085 13719 133366 133366 133366 POLE ATTACHMENT INCOME 221000 497368 497368 BOND SECURITIZATION P'SHIP INCOME 221000 388773 388773 75 75 886216 199747533 197815149 0 1932384 X 27424 3813798 3211296 7771197 504341 534624 750893 19656889 19364336 PURCHASED POWER 129467254 DISTRIBUTION EXPENSE 5333088 ADMIN & GENERAL EXPENSE 3895458 CONSUMER EXPENSE 2095469 348487 196774554 3380555 760607 14268141 18136536 16897619 21512619 278632 219430 506886 559531 677652036 140322478 453136475 537329558 59323008 62568958 3712776 5724375 551504092 646811614 29782430 19176687 309769 304909 355845941 451488161 17526055 26997513 403464195 497967270 X 1211420 1354325 0 0 146828477 147490019 148039897 148844344 551504092 646811614 X 2972979 -2168532 X X 0 1 X 0 0 0 1 X 11219377 11219377 13248605 2383667 10864938 600059071 137938811 462120260 53124983 53124983 537329558 PATRONAGE CAPITAL-CFC 6260531 C PATRONAGE CAPITAL-RCEC 39161445 C PATRONAGE CAPITAL-TEC 693912 C PATRONAGE CAPITAL-NISC 299845 C CAPITAL TERM CERTIFICATES-CFC 3433714 C INVESTMENT IN AFFILIATED COMPANY 4100495 C LONG TERM INVESTMENTS-CFC 6000000 C BANCORP SOUTH VAN ALSTYNE - MONEY MARKET ACCOUNT 304909 C PATRONAGE CAPITAL-NRTC 34424 C OTHER INVESTMENTS 1000 C INVESTMENT - PARETO CAPTIVE 44075 C INVESTMENT IN BOND SECURITIZATION PARTNERSHIP 2234608 C 62568958 ACCUMULATED PROVISION FOR PENSION & BENEFITS 4599600 CUSTOMER DEPOSITS 49890 ACCRUED OPERATING TAXES 3653416 OVERCOLLECTED POWER COST 16001062 OTHER LIABILITIES 193688 DEFERRED CREDITS - UNAMORTIZED GAIN ON REACQUIRED DEBT 33307 DEFERRED CREDITS - COST OF INSTALLATION 533630 DEFERRED CREDITS - UNCLAIMED CAPITAL CREDITS 1932920 26997513 X 197753660 0 197753660 1993873 1993873 199747533 192959577 0 192959577 3814977 3814977 196774554 PART IV, LINE 2B: PURSUANT TO SECTION 74.3013 OF THE TEXAS PROPERTY CODE, THE COOPERATIVE HAS ESTABLISHED A RURAL SCHOLARSHIP FUND WITH RETIREMENTS OF PATRONAGE CAPITAL, WHICH HAVE REMAINED UNCLAIMED FOR A PERIOD OF THREE YEARS. THE AMOUNTS DEPOSITED INTO THE RURAL SCHOLARSHIP FUND ARE REPORTED TO 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. PART X, LINE 2: THE COOPERATIVE AND SUBSIDIARIES 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 SUBSIDIARIES DETERMINED THAT IT IS MORE LIKELY THAN NOT THAT ITS TAX POSITIONS 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 4B - OTHER ADJUSTMENTS: EXCISE TAX RECLASSED TO EXPENSE 1,179. EQUITY METHOD INCOME/LOSS FROM SUBSIDIARY 1,992,694. PART XII, LINE 4B - OTHER ADJUSTMENTS: PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 3,813,798. EXCISE TAX RECLASSED TO EXPENSE 1,179. 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. 0 X 0 0 0 DAVID MCGINNIS GENERAL MANAGER/CEO 440600 0 8569 0 85715 0 26400 0 32921 0 594205 0 0 0 KEVIN STEVENS COO 255191 0 4640 0 28536 0 21158 0 32921 0 342446 0 0 0 MIKE ROLANDT CFO 222560 0 4280 0 16257 0 18969 0 46019 0 308085 0 0 0 TRACY BEGLEY MANAGER OF INSIDE OPERATIONS 220000 0 4000 0 17784 0 17936 0 45873 0 305593 0 0 0 CHRIS OFFILL CEO/CFO COMMUNICATIONS 223600 0 4300 0 13308 0 18696 0 33386 0 293290 0 0 0 PAUL YATES MANAGER OF UNDERGROUND OPERATIONS 196040 0 3770 0 26674 0 17161 0 32130 0 275775 0 0 0 LESLIE SIMCO MANAGER OF OPERATIONS 167770 0 3084 0 21544 0 14458 0 45256 0 252112 0 0 0 JEFF SMITH MANAGER OF INFORMATION TECHNOLOGY 186368 0 3584 0 12662 0 15712 0 32921 0 251247 0 0 0 JASON SPROWL MANAGER OF OPERATIONS - LOSS CONTROL 179603 0 3300 0 5698 0 13992 0 45400 0 247993 0 0 0 WILLIAM MCGINNIS MANAGER OF BUS. DEVELOPMENT 173275 0 3080 0 8256 0 11116 0 43943 0 239670 0 0 0 MICHAEL LAUER MANAGER OF BUS. DEVELOPMENT 170561 0 3280 0 16486 0 14773 0 32293 0 237393 0 0 0 MARC KARO FOREMAN 175785 0 2400 0 584 0 9984 0 44796 0 233549 0 0 0 EDDY REECE MANAGER OF SUBSTATIONS 160038 0 3188 0 8046 0 13262 0 45326 0 229860 0 0 0 MARTY JONES MANAGER OF OPERATIONS 160368 0 3084 0 13790 0 13755 0 32147 0 223144 0 0 0 SHAWN WRIGHT LINE SUPERINTENDENT - SERVICE SUPERV 163226 0 3006 0 4162 0 12745 0 28696 0 211835 0 0 0 MEGAN MCGINNIS FAMILY RELATIONSHIP - EMPLOYEE OFFICER (D. MCGINNIS - GENERAL MANAGER/CEO) 122719 EMPLOYMENT 0 WILLIAM MCGINNIS FAMILY RELATIONSHIP - EMPLOYEE OFFICER (D. MCGINNIS - GENERAL MANAGER/CEO) 184611 EMPLOYMENT 0 BRAYDEN COPELAND FAMILY RELATIONSHIP - DIRECTOR (COPELAND) 65388 EMPLOYMENT 0 OLIVIA COPELAND FAMILY RELATIONSHIP - DIRECTOR (COPELAND) 48821 EMPLOYMENT 0 FORM 990, PART I, LINE 19: 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 INCOME OF $2,972,979 WHICH IS THE INCOME STATEMENT EFFECT OF ACCRUED UNBILLED REVENUE, RETENTION OF NON-OPERATING MARGINS, AND EQUITY METHOD LOSS. EQUITY METHOD LOSS IS RECORDED IN THE COOPERATIVE'S BOOKS AND INCLUDED IN NET MARGINS. U.S. GAAP REQUIRES THE COOPERATIVE TO RECORD ON ITS BOOKS EQUITY METHOD INCOME OR LOSS FROM ITS WHOLLY OWNED SUBSIDIARY. EQUITY METHOD INCOME/LOSS IS NOT INCOME FOR IRS FORM 990 PURPOSES AS SUCH HAS BEEN REPORTED AS AN OTHER CHANGE IN NET ASSETS. 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 REPORTS NET INCOME EQUAL TO THE NET INCREASE IN ACCRUED UNBILLED REVENUE OR A NET LOSS EQUAL TO THE NET DECREASE IN UNBILLED REVENUE PLUS NON-OPERATING MARGINS. THE FOLLOWING SCHEDULE IS PROVIDED TO FURTHER EXPLAIN THE IMPACT OF THESE TRANSACTIONS: ADD: UNBILLED REVENUE 12/31/23 $ 3,224,000 LESS: UNBILLED REVENUE 12/31/22 (2,207,000) (A) - NET INCREASE OF UNBILLED REVENUE $ 1,017,000 ADD: NON-OPERATING MARGINS 1,955,979 (B) - PART I, LINE 19 $ 2,972,979 (C) - LESS EQUITY METHOD LOSS (1,992,694) (D) - BENEFITS PAID TO MEMBERS (I.E. PATRONAGE DIVIDENDS), PART I, LINE 14 $ 3,813,798 TOTAL 2023 NET MARGIN (B + C + D) $ 4,794,083 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. 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, REVIEW AND APPROVAL PRIOR TO FILING. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF DIRECTORS PERFORM AN ANNUAL REVIEW AND UTILIZE INTERNAL RESOURCES WHEN DETERMINING THE COMPENSATION OF THE GENERAL MANAGER. THE BOARD AND THE GENERAL MANAGER UTILIZE INTERNAL RESOURCES WHEN DETERMINING THE COMPENSATION OF THE COOPERATIVE'S OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEE, IF ANY. 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 OR GOVERNING DOCUMENTS TO ANY MEMBER WHO REQUESTS A COPY. 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 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 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 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 AN RUS BORROWER, ITS ACCOUNTING RECORDS ARE MAINTAINED IN ACCORDANCE WITH THE RUS UNIFORM SYSTEM OF ACCOUNTS (USOA) 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 $10,982,493 LESS: DIRECTORS FEES REPORTED ON FORM 1099-NEC (135,539) LESS: OFFICER & KEY EMPLOYEE BENEFITS INCLUDED IN LINE 5 (556,407) PLUS: SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 2,844,108 PLUS: SALARIES AND WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 615,980 TOTAL WAGES ACCRUED AND/OR PAID $13,750,635 FORM 990, PART IX, LINE 24: ADMINISTRATIVE & GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS, & OTHER $ 3,714,786 OFFICE SUPPLIES 374,660 OUTSIDE SERVICES 588,226 GENERAL ADVERTISING 15,899 INSURANCES 113,323 REGULATORY COMMISSION 325,772 DIRECTORS 208,733 DUES & MEMBERSHIPS 101,346 ANNUAL MEETING 389,511 MAINTENANCE OF GENERAL PLANT 452,944 MISCELLANEOUS GENERAL 1,404,677 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 7,689,877 LESS: RECLASS OF DIRECTOR FEES TO PART IX, LINE 5 (135,539) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (2,979,540) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (679,340) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 3,895,458 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). 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 XI, LINE 9: PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 3,813,798. PATRONAGE CAPITAL RETIRED - TOTAL -3,999,756. PATRONAGE CAPITAL RETIRED - DISCOUNT 13,309. NET CHANGE IN MEMBERSHIPS 142,905. OTHER COMPREHENSIVE INCOME - PROVISION FOR PENSION AND BENEFITS -146,094. EQUITY METHOD INCOME (LOSS) FROM SUB -1,992,694. 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. GRAYSON-COLLIN SERVICES INC PO BOX 548 VAN ALSTYNE TX 75495 752822236 TO PROVIDE TELECOM SERVICES TO CO-OP MEMBERS TX GRAYSON COLLIN ELECTRIC COOPERATIVE INC C 4100495 1.00000 1 CUTTER COMMUNICATIONS INC DBA GRAYSON COLLIN COMMUNICATIONS PO BOX 2119 VAN ALSTYNE TX 75495 752463150 TO PROVIDE TELECOMMUNICATIONS EQUIP & SERVICES TX GRAYSON COLLIN SERVICES INC C 7445875 38503363 1.00000 1 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 1 1 0 0 CUTTER COMMUNICATIONS INC DBA GRAYSON COLLIN COMMUNICATIONS D 4615000 LINE OF CREDIT ADVANCE CUTTER COMMUNICATIONS INC DBA GRAYSON COLLIN COMMUNICATIONS P 170910 INVOICES & OTHER SUPPORT CUTTER COMMUNICATIONS INC DBA GRAYSON COLLIN COMMUNICATIONS Q 4785910 INVOICES & OTHER SUPPORT