2025-11-10T13:23:28-06:00 2024-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2024-01-01 850036237 FARMERS ELECTRIC COOPERATIVE INC OF NEW MEXICO FARM 5757624466 PO BOX 550 CLOVIS NM 881020550 ANTONIO SANCHEZ JR CEO 5757624466 2025-11-10 1 0 WILLIAM M MILLER P00439459 8067473806 2025-11-10 X 2024 2025-03-06 01:10:19Z ANTONIO SANCHEZ JR PO BOX 550 CLOVIS NM 881020550 44143399 0 X WWW.FECNM.ORG X 1937 NM TO PROVIDE QUALITY AND RELIABLE ELECTRIC SERVICE TO MEMBERS OF THE COOPERATIVE. 6 6 64 0 0 0 0 0 42121072 43502412 468609 629848 6335 11139 42596016 44143399 15548 13635 3513245 4062388 5318941 5325646 0 0 0 33577651 34130396 42425385 43532065 170631 611334 137801679 153749954 77411068 89560108 60390611 64189846 NONE 0 0 PROVIDING ELECTRIC ENERGY TO OUR MEMBERS ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. THERE WERE 16,290 ACTIVE SERVICES AT YEAR END. 0 0 0 0 0 0 0 0 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 0 1 1 0 0 1 37 0 64 1 0 0 0 0 0 56082196 751371 0 0 0 X 6 6 0 0 0 0 1 1 1 1 0 0 0 1 1 1 1 1 1 1 1 0 X X SUZETTE HOWARD ACCOUNTING MANAGER 5757624466 3701 NORTH THORNTON ST CLOVIS NM 881020550 X MICHAEL B WEST PRESIDENT 4.00 0.30 X X 3893 0 0 GEORGE DODGE JR VICE PRESIDENT 5.50 0.30 X X 5517 0 0 DONNIE BIDEGAIN SECRETARY/TREASURER 3.90 0.30 X X 3317 0 0 JUBAL PIERCE TRUSTEE (JAN-NOV) 3.80 0.30 X 4517 0 0 JUDY SMITH TRUSTEE 2.60 0.30 X 3517 0 0 JUSTIN BARNES TRUSTEE 2.20 0.30 X 2717 0 0 QUENTIN WOOD TRUSTEE (MAY-DEC) 2.90 0.30 X 3985 0 0 JOHN PAT WOODS TRUSTEE (JAN-MAY) 0.90 0.30 X 1004 0 0 ANTONIO SANCHEZ CEO/GENERAL MANAGER 46.00 X 181507 0 83955 THOMAS J MOORE DIRECTOR OF MEMBER SERVICE 45.00 X 123963 0 54838 SUZETTE HOWARD CFO 45.00 X 120252 0 57759 BARRY T BASS LINE SUPERINTENDENT 50.00 X 124528 0 112684 HELEN JO WALLIN CUSTOMER SERVICE/HR MANAGER 45.00 X 121404 0 44332 MICHAEL L MCCORD ENGINEERING MANAGER 50.00 X 118771 0 36404 KALON LAFFERTY LINE FOREMAN 50.00 X 114238 0 19248 CALVIN LILES LINE FOREMAN 50.00 X 107337 0 20547 1040467 0 429767 14 0 1 0 SOUTHWEST POWER SOLUTIONS 1912 S 6TH ST TUCUMCARI NM 88401 LINE CONSTRUCTION 713292 SGS ENGINEERING 401 50TH ST LUBBOCK TX 79404 ENGINEERING SERVICES 348660 EXPANSE ELECTRICAL COMPANY PO BOX 842751 DALLAS TX 75284 LINE CONSTRUCTION 127032 HI RANGE ELECTRIC PO BOX 2688 HEREFORD TX 79045 LINE CONSTRUCTION 121796 HRT POWER SERVICES 959 CR 6 CLOVIS NM 88101 LINE CONSTRUCTION 102194 5 X SALES OF ELECTRICITY 221000 41804643 41804643 PATRONAGE DIVIDENDS 221000 1686046 1686046 SERVICE FEES 221000 11723 11723 43502412 629848 629848 MISCELLANEOUS REVENUES 221000 7284 7284 POLE ATTACHMENT INCOME 221000 3855 3855 11139 44143399 43509696 0 633703 X 13635 4062388 650741 2927748 649766 845199 252192 1933121 4393843 PURCHASED POWER 23603030 DISTRIBUTION EXPENSE 2591081 ADMIN & GENERAL EXPENSE 733948 CONSUMER EXPENSE 615305 260068 43532065 287034 840530 6113637 13658297 3536762 3049372 189345 3638981 3608841 669988 688678 158167263 46552703 105728090 111614560 1853606 2195086 15053924 16688346 919657 1216899 137801679 153749954 3804361 7596411 70905942 68240010 2700765 13723687 77411068 89560108 X 0 0 0 0 60390611 64189846 60390611 64189846 137801679 153749954 X 611334 255314 2932587 X X 0 1 X 1 0 752878 752878 3792173 1325613 2466560 147717416 45227090 102490326 5904796 5904796 111614560 PATRONAGE CAPITAL - OTHERS 388813 C PATRONAGE CAPITAL - CFC 307124 C PATRONAGE CAPITAL - FEDERATED 413118 C PATRONAGE CAPITAL - WFEC 5462665 C PATRONAGE CAPITAL - COBANK 31841 C CFC - CAPITAL TERM CERTIFICATES 727043 C INVESTMENTS IN OTHER ASSOCIATED ORGANIZATIONS 5386 C MEMBERSHIPS - OTHER 3710 C EQUITY CONTRIBUTION - WFEC 9348646 C 16688346 CONSUMER DEPOSITS 272074 DEFERRED CREDITS - ADVANCES FOR CONSTRUCTION 12652850 ACCRUED OPERATING TAXES 798763 13723687 X 44392268 255314 255314 44136954 6445 6445 44143399 39463232 0 39463232 4068833 4068833 43532065 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 4B - OTHER ADJUSTMENTS: RECLASSIFY EXPENSES RECORDED IN NON-OPERATING MARGINS 6,445. PART XII, LINE 4B - OTHER ADJUSTMENTS: RECLASSIFY EXPENSES RECORDED IN NON-OPERATING MARGINS 6,445. PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 4,062,388. 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 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". X X 0 0 0 ANTONIO SANCHEZ CEO/GENERAL MANAGER 174263 0 1083 0 6161 0 78309 0 5646 0 265462 0 0 0 BARRY T BASS LINE SUPERINTENDENT 121122 0 541 0 2865 0 110146 0 2538 0 237212 0 0 0 THOMAS J MOORE DIRECTOR OF MEMBER SERVICE 117130 0 541 0 6292 0 50683 0 4155 0 178801 0 0 0 SUZETTE HOWARD CFO 115281 0 541 0 4430 0 48884 0 8875 0 178011 0 0 0 HELEN JO WALLIN CUSTOMER SERVICE/HR MANAGER 114363 0 541 0 6500 0 38830 0 5502 0 165736 0 0 0 MICHAEL L MCCORD ENGINEERING MANAGER 115651 0 541 0 2579 0 28529 0 7875 0 155175 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. 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 CONTRIBUTION TO THE PLAN IN LIEU OF THE ACTUARIAL INCREASE ARE EXPENSED IN THE FINANCIAL STATEMENTS. ANTONIO SANCHEZ: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 76,468 EMPLOYER CONTRIBUTION TO 401(K) PLAN 1,841 TOTAL REPORTED IN COLUMN C $ 78,309 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (76,468) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 59,309 EXPENSE TO THE COOPERATIVE $ 61,150 BARRY BASS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 108,902 EMPLOYER CONTRIBUTION TO 401(K) PLAN 1,244 TOTAL REPORTED IN COLUMN C $ 110,146 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (108,902) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 41,220 EXPENSE TO THE COOPERATIVE $ 42,464 THOMAS J. MOORE: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 49,465 EMPLOYER CONTRIBUTION TO 401(K) PLAN 1,218 TOTAL REPORTED IN COLUMN C $ 50,683 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (49,465) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 40,181 EXPENSE TO THE COOPERATIVE $ 41,399 SUZETTE HOWARD: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 47,626 EMPLOYER CONTRIBUTION TO 401(K) PLAN 1,258 TOTAL REPORTED IN COLUMN C $ 48,884 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (47,626) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 41,752 EXPENSE TO THE COOPERATIVE $ 43,010 HELEN JO WALLIN: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 37,615 EMPLOYER CONTRIBUTION TO 401(K) PLAN 1,215 TOTAL REPORTED IN COLUMN C $ 38,830 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (37,615) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 39,793 EXPENSE TO THE COOPERATIVE $ 41,008 MICHAEL MCCORD: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 27,278 EMPLOYER CONTRIBUTION TO 401(K) PLAN 1,251 TOTAL REPORTED IN COLUMN C $ 28,529 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (27,278) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 41,752 EXPENSE TO THE COOPERATIVE $ 43,003 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 A NET INCOME OF $611,334, WHICH IS THE INCOME STATEMENT EFFECT OF ACCRUED UNBILLED REVENUE AND FORM 990 REPORTING OF UNREALIZED GAINS AND LOSSES AS A COMPONENT OF OTHER CHANGES IN NET ASSETS IN LIEU OF REPORTING AS AN ITEM OF REVENUE OR INCOME. 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 12/31/24 $ 860,090 LESS: UNBILLED REVENUE 12/31/23 (879,443) ADD: TRANSFER MARGINS TO OTHER EQUITIES 886,001 LESS: UNREALIZED (GAIN)/LOSS (255,314) (A) - INCREASE EQUALS NET INCOME ON PAGE 1, LINE 19 $ 611,334 (B) - BENEFITS PAID TO MEMBERS (I.E. PATRONAGE DIVIDENDS), PART I, LINE 14 $ 4,062,388 (C) - UNREALIZED GAIN/LOSS - PART XI, LINE 5 255,314 TOTAL 2024 NET MARGIN (A + B + C) $ 4,929,036 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 TRUSTEES. 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 5. AMENDMENT TO THE BYLAWS 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. THE DISCUSSION AND REVIEW WAS PERFORMED AT THE BOARD MEETING IMMEDIATELY BEFORE THE FILING OF THE FORM 990. FORM 990, PART VI, SECTION B, LINE 12C EACH TRUSTEE SHALL ANNUALLY SIGN A STATEMENT WHICH AFFIRMS SUCH PERSON: A.) HAS RECEIVED A COPY OF THE CONFLICT OF INTEREST POLICY B.) HAS READ AND UNDERSTANDS THE POLICY C.) HAS AGREED TO COMPLY WITH THE POLICY FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF TRUSTEES USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE GENERAL MANAGER. THE SURVEY SHOWS COMPARATIVE SALARIES FOR GENERAL MANAGERS FROM COOPERATIVES LOCATED IN NEW MEXICO AND THE NATION. THE GENERAL MANAGER USES A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE COOPERATIVE'S OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICERS AND KEY EMPLOYEES, IF ANY. THE SURVEY INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT NEW MEXICO AND THE NATION. FORM 990, PART VI, SECTION C, LINE 19 THE COOPERATIVE MAILS AN ANNUAL REPORT TO ALL MEMBERS. INCLUDED IN THE REPORT IS A COPY OF THE AUDITED BALANCE SHEET AND INCOME STATEMENT. THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF THE AUDITED FINANCIAL STATEMENTS, CONFLICT OF INTEREST POLICY AND GOVERNING DOCUMENTS TO ANY MEMBER WHO MAKES A WRITTEN REQUEST FOR A COPY OF ANY SUCH DOCUMENT. THE MEMBER SHALL MAKE A REQUEST FOR INFORMATION AND/OR DOCUMENTS BY SUBMITTING A "MEMBER INFORMATION REQUEST" FORM. THIS PROCEDURE IS CONSISTENT WITH COOPERATIVE POLICY VII-1. THE BYLAWS, FINANCIAL INFORMATION AND A COPY OF THE FORM 990 CAN BE FOUND ON THE COOPERATIVE'S WEBSITE WWW.FECNM.ORG. FORM 990, PARTS VI & VII THE COOPERATIVE ANNUALLY PROVIDES EACH TRUSTEE WHO SERVED ON THE BOARD DURING THE YEAR A QUESTIONNAIRE AND TIME LOG. THE COMPLETED QUESTIONNAIRES AND TIME LOGS ARE USED TO COMPLETE THE APPLICABLE QUESTIONS ON THE FORM 990 PERTAINING TO BUSINESS RELATIONSHIPS AMONG TRUSTEES, OFFICERS, AND KEY EMPLOYEES, AS WELL AS TO DETERMINE IF THERE ARE ANY TRANSACTIONS WHICH MUST BE REPORTED IN DETAIL ON SCHEDULE L - "TRANSACTIONS WITH INTERESTED PERSONS". IF THE COOPERATIVE WAS UNABLE TO OBTAIN A COMPLETED QUESTIONNAIRE AND/OR TIME LOG, THE COOPERATIVE RELIED UPON THE COMPLETED INFORMATION FOR THE PRIOR YEAR. JOHN WOODS RETIRED DURING 2024; THEREFORE, HIS PRIOR YEAR QUESTIONNAIRE WAS RELIED UPON WHILE PREPARING THE RETURN. THERE WERE NO KNOWN CHANGES. 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 PALN 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 AND LIFE INSURANCE TO ALL ELIGIBLE EMPLOYEES THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICERS 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. FORM 990, PART VIII, LINE 2B: 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 VIII, LINE 2A: THE COOPERATIVE AND WESTERN FARMERS ELECTRIC COOPERATIVE (WFEC), A RURAL ELECTRIC GENERATION AND TRANSMISSION COOPERATIVE, HAVE ENTERED INTO A WHOLESALE POWER CONTRACT WHERE WFEC WILL PROVIDE THE COOPERATIVE WITH ELECTRIC POWER. AS PART OF THE AGREEMENT THE COOPERATIVE MUST CONTRIBUTE EQUITY TO WFEC IN A MANNER AND AMOUNT SUCH THAT, AS OF JUNE 1, 2026, THE COOPERATIVE HAS CONTRIBUTED EQUITY TO WFEC COMPARABLE TO THE AMOUNT OF EQUITY CONTRIBUTED TO WFEC BY PRIOR EXISTING MEMBERS. THE PURPOSE OF THE CONTRIBUTION IS TO OBTAIN A POWER SUPPLY IN ORDER TO MEET THE TERMS OF THE WHOLESALE PURCHASE CONTRACT. PURUSANT TO APPROVAL BY THE NEW MEXICO PUBLIC REGULATION COMMISSION, THE EQUITY CONTRIBUTION IS RECOVERED MONTHLY FROM THE MEMBERS THROUGH THE SALE OF ELECTRICITY. FORM 990, PART IX: THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE RUS UNIFORM SYSTEM OF ACCOUNTS (USOA) AS PRESCRIBED FOR RURAL UTILITIES SERVICE (RUS) ELECTRIC BORROWERS. THE USOA DOES NOT RECORD EXPENSES IN THE GENERAL EXPENSE CATEGORIES PROVIDED ON PART IX LINES 1-23. THE COOPERATIVE SEPARETLY 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 $ 3,578,489 LESS: TRUSTEE FEES REPORTED ON FORMS 1099-NEC (28,467) LESS: EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (196,552) PLUS: SALARIES AND WAGES ALLOCATED TO NONOPERATING 3,369 PLUS: SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 967,665 PLUS: SALARIES AND WAGES CAPITALIZED/EXPENSES INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 204,104 TOTAL WAGES ACCRUED AND OR PAID $ 4,528,608 FORM 990, PART IX, LINE 24: ADMINISTRATIVE AND GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS, & OTHER $ 849,817 OFFICE SUPPLIES 178,285 OUTSIDE SERVICES EMPLOYED 50,362 REGULATORY COMMISSION 210,359 MISCELLANEOUS GENERAL 311,851 ASSOCIATION DUES 143,677 CAPITAL CREDIT 27,560 TRUSTEES 83,823 ADVERTISING 25,417 RENTS 1,048 MAINTENANCE OF GENERAL PLANT 67,639 DUPLICATE CHARGES (CREDIT) (40,347) TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 1,909,491 LESS: RECLASS OF TRUSTEE FEES TO PART IX, LINE 5 (28,467) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (726,177) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (420,899) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 733,948 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 2024 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: SALES $ 71,292 TRANSMISSION 182,331 MISCELLANEOUS AND OTHER DEDUCTIONS 6,445 TOTAL OTHER EXPENSES PER FORM 990, LINE 24E $ 260,068 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 4,062,388. PATRONAGE CAPITAL RETIRED - TOTAL -1,151,736. PATRONAGE CAPITAL RETIRED - DISCOUNT 21,935. FORM 990, PART XII, LINE 2C: FARMERS ELECTRIC COOPERATIVE HAS A SEPARATE AUDIT COMMITTEE RESPONSIBLE FOR OVERSEEING THE FINANCIAL STATEMENT AUDIT AND SELECTING THE INDEPENDENT FINANCIAL STATEMENT AUDITOR. FARMERS ELECTRIC EDUCATION FOUNDATION PO BOX 550 CLOVIS NM 881020550 850348498 TO PROVIDE COLLEGE SCHOLARSHIPS TO ACTIVE MEMBERS AND THEIR FAMILY. NM 501(C)(3) PF FARMERS ELECTRIC COOPERATVIE INC 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 0 0 0 0 FARMERS ELECTIC EDUCATION FOUNDATION N N/A - LESS THAN $50,000 FARMERS ELECTIC EDUCATION FOUNDATION O N/A - LESS THAN $50,000