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TIN:
SCHEDULE O
(Form 990 or 990-EZ)
Department of the Treasury
Internal Revenue Service
(Form 990 or 990-EZ)
Department of the Treasury
Internal Revenue Service
Supplemental Information to Form 990 or 990-EZ
Complete to provide information for responses to specific questions on
Form 990 or 990-EZ or to provide any additional information.
Attach to Form 990 or 990-EZ.
Information about Schedule O (Form 990 or 990-EZ) and its instructions is atwww.irs.gov/form990.
OMB No. 1545-0047
2015
Open to Public
Inspection
Inspection
Name of the organization
CHOCTAW ELECTRIC COOPERATIVE INC
Employer identification number
73-0182325
73-0182325
| Return Reference | Explanation |
|---|---|
| FORM 990, PART VI, SECTION A, LINE 4 | AT THE ANNUAL MEETING ON SEPTEMBER 26TH, 2015, THE BYLAWS WERE AMENDED AS FOLLOWS: ARTICLE III: "MEETINGS OF MEMBERS" WAS AMENDED TO MAKE IT POSSIBLE FOR CEC TO HOLD SIMULTANEOUS ANNUAL MEETINGS ANYWHERE IN CEC SERVICE TERRITORY. IT ALSO GIVES MEMBERS THE OPTION TO VOTE BY MAIL-IN BALLOT. ARTICLE IV: "TRUSTEES" WAS AMENDED TO PREVENT FORMER CO-OP EMPLOYEES FROM SERVING ON THE BOARD OF TRUSTEES; CLARIFY ROTATION OF TRUSTEE ELECTIONS; LIMIT TRUSTEES TO SERVING NO MORE THAN FOUR TERMS; REQUIRE VOTING DISTRICT COMPOSITION TO BE REVIEWED ONCE EVERY FIVE YEARS TO MAINTAIN EQUALITY; REQUIRE INCUMBENT TRUSTEES TO PETITION MEMBERS TO RUN FOR OFFICE; ALLOW TRUSTEES TO DECLARE A SEAT VACANT IF A TRUSTEE FAILS TO ATTEND AT LEAST 75 PERCENT OF BOARD MEETINGS EACH YEAR; AND REQUIRE APPOINTED TRUSTEES TO STAND FOR ELECTION AT THE ANNUAL MEETING FOLLOWING THEIR APPOINTMENT; PREVENT TRUSTEES FROM RECEIVING INSURANCE BENEFITS, BUT WOULD ALLOW THEM THE OPTION TO PARTICIPATE IN CEC'S HEALTH BENEFITS AT THEIR OWN EXPENSE; PREVENT CLOSE RELATIVES OF TRUSTEES OR FORMER TRUSTEES FROM RECEIVING CONTRACTS OR ANY OTHER FINANCIAL COMPENSATION; ALLOW BOARD MEMBERS COMPENSATION FOR EXPENSES INCURRED FROM PERFORMING THEIR DUTIES AS TRUESTEES; AND ALLOW MEMBERS ACCESS TO CO-OP AUDIT REPORTS. ARTICLE V: "MEETING OF TRUSTEES" WAS AMENDED TO ALLOW MEMBERS TO ATTEND CO-OP BOARD MEETINGS, HOWEVER, THE BOARD MAY ENTER INTO PRIVATE EXECUTIVE SESSION TO DISCUSS LEGAL MATTERS, REAL ESTATE TRANSACTIONS, CONTRACT NEGOTIATIONS, PERSONNEL ISSUES, COMPETITIVE ISSUES, AND CO-OP AND MEMBER SECURITY. FINAL ACTION ON MATTERS DISCUSSED IN EXECUTIVE SESSION MUST BE MADE IN THE REGULAR MEETING, EXCEPT WHEN VOTING COULD RESULT IN LEGAL ACTION OR OTHER NEGATIVE FINANCIAL IMPACT ON CEC. ACTICLE VI: "OFFICERS & MISCELLANEOUS" WAS AMENDED TO PREVENT THE TITLE OF GENERAL MANAGER/CEO TO BE USED INTERCHANGEABLY WITH EXECUTIVE VICE PRESIDENT; AND ELIMINATES A REDUNDANT BYLAW PROVISION. ARTICLE XV: "AMENDMENTS" WAS AMENDED TO INCLUDE THE CREATION OF A NEW SECTION ON BYLAW AMENDMENTS. THE NEW PROVISION REQUIRES THE ANNUAL MEETING NOTICE TO INCLUDE A COPY OF PROPOSED AMENDMENT(S), YET ALLOWS TRUSTEES OR MEMBERS TO REPEAL OR CORRECT ANY BYLAW OR AMENDMENT THAT IS ILLEGAL OR HAS BECOME A LEGAL NULLITY. DEADLINES FOR SUBMITTING BYLAW CHANGES ARE MORE CLEARLY DEFINED, AND PROCEDURES CONCERNING PROPOSED AMENDMENTS ARE CLARIFIED TO BRING CEC BYLAWS INTO COMPLIANCE WITH STATE AND FEDERAL LAWS. A COMPLETE COPY CEC'S BYLAWS MAY BE FOUND ON THE COOPERATIVE'S WEBSITE. |
| 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. AMENDMENTS TO THE ARTICLES OF INCORPORATION; 2. AMENDMENTS TO THE BYLAWS; 3. DISPOSAL OF SUBSTANTIAL PORTION OF THE COOPERATIVE'S ASSETS; 4. DISSOLUTION/LIQUIDATION OF THE COOPERATIVE; AND 5. MERGER OR CONSOLIDATION OF THE COOPERATIVE WITH ANOTHER ORGANIZATION. |
| FORM 990, PART VI, SECTION B, LINE 11 | MANAGEMENT PRESENTED A COPY OF THE FORM 990 TO THE BOARD FOR DISCUSSION, REVIEW AND APPROVAL PRIOR TO FILING. THE DISCUSSION AND REVIEW WAS PERFORMED AT THE BOARD MEETING IMMEDIATELY BEFORE FILING THE FORM 990. |
| FORM 990, PART VI, SECTION B, LINE 15 | THE BOARD OF DIRECTORS ASSSESS PERFORMANCE AND ALSO USES A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE CEO. THE SURVEY SHOWS COMPARATIVE SALARIES FOR GENERAL MANAGERS FROM COOPERATIVES LOCATED IN OKLAHOMA. THE CEO ASSSESSES PERFORMANCE AND ALSO USES A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE ORGANIZATION'S OTHER OFFICERS. THE SURVEY INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT OKLAHOMA. |
| FORM 990, PART VI, SECTION C, LINE 19 | THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF ITS GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND AUDITED FINANCIAL STATEMENTS TO ANY MEMBER WHO REQUESTS A COPY OF ANY SUCH DOCUMENT. ANNUALLY THE COOPERATIVE PROVIDES A COPY OF THE AUDITED BALANCE SHEET AND INCOME STATEMENT TO THE MEMBERS OF THE COOPERATIVE WITH THE ANNUAL REPORT. FINALLY, THE ANNUAL REPORT AND BYLAWS CAN BE FOUND ON THE COOPERATIVE'S WEBSITE. |
| FORM 990, PART VII, COLUMN F | IN ORDER TO PROVIDE RETIREMENT BENEFITS TO ITS EMPLOYEES THE COOPERATIVE PARTICIPATES IN A MULTI-EMPLOYER DEFINED BENEFIT PLAN. CONTRIBUTIONS TO THIS PLAN ARE BASED ON THE FULL FUNDING LIMIATION OF THE PLAN. EMPLOYER CONTRIBUTIONS ARE AVAILABLE TO PARTICIPATING EMPLOYEES, INCLUDING OFFICERS AND HIGHLY COMPENSATED EMPLOYEES, MEETING THE ELIGIBILITY REQUIREMENTS OF THE PLAN. THE COOPERATIVE ALSO PROVIDES HEALTH BENEFITS TO ALL ELIGIBLE EMPLOYEES THROUGH A SELF-INSURANCE PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR OFFICERS AND HIGHLY COMPENSATED EMPLOYEES ARE COMPRISED OF THE THE ACTUARIAL INCREASE IN THE DEFINED BENEFIT PENSION PLAN AND THE INSURANCE PREMIUM VALUES FOR CONTRIBUTIONS MADE TO THE SELF-INSURANCE PLAN ON BEHALF OF AND FOR THEIR BENEFIT. |
| 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 | THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE RUS UNIFORM SYSTEM OF ACCOUNTS AS PRESCRIBED FOR BORROWERS OF THE RURAL UTILITIES SERVICE. THE UNIFORM SYSTEM OF ACCOUNTS 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 ARE REPORTED ON LINE 24 UNDER THE EXPENSE CATEGORIES REQUIRED BY THE UNIFORM SYSTEM OF ACCOUNTS. |
| FORM 990, PART IX, LINE 24 | ADMINISTRATIVE AND GENERAL EXPENSES IS COMPRISED OF THE FOLLOWING: OFFICE SUPPLIES AND OTHER EXPENSES $ 134,685 LEASE PAYMENT 25,469 SHIPPING AND FREIGHT 16,975 DATA PROCESSING 16,299 TELEPHONE & UTILITIES 227,021 OUTSIDE SERVICES EMPLOYED 65,117 IN-HOUSE ATTORNEY FEES & EXP 69,110 COBANK CASH MANAGEMENT FEES 8,721 COMPLIANCE 83,910 ELECTRONIC MAPPING PROGRAM 40,407 BROADBAND GRANT EXPENSE 2,015 GENERAL LIABILITY INSURANCE 77,905 INJURIES AND DAMAGES 633 TRUSTEES' FEES AND EXPENSES 146,707 BYLAW COMMITTEE EXPENSE 5,225 DUES AND SUBSCRIPTIONS 101,265 TRAINING EXPENSE 55,377 MANAGERS EXPENSES 21,243 MAINTENANCE OF GENERAL PLANT 81,747 MEMBER MEETING EXPENSE 76,692 NONOPERATING EXPENSES - INTERNET 2,153 TOTAL ADMINISTRATIVE AND GENERAL EXPENS PER FORM 990 $1,258,676 |
| 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 THE TOTAL WAGES ACCRUED AND/OR PAID: TOTAL PER LINES 5-7 $3,304,875 LESS DIRECTORS FEES REPORTED ON 1099-MISC (72,000) LESS EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (166,118) PLUS SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 1,077,859 PLUS SALARIES AND WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 929,802 TOTAL WAGES ACCRUED AND/OR PAID $5,074,418 |
| 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 2015 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 DONATIONS ARE MADE TO NON-PROFIT AND CIVIC ORGANIZATIONS THAT ARE LOCATED IN THE COOPERATIVE'S SERVICE AREA. ALL DONATIONS ARE INTENDED TO IMPROVE THE COMMUNITIES IN WHICH OUR MEMBERS RESIDE. EACH GRANT, SCHOLARSHIP AND/OR DONATION MADE DURING THE YEAR WAS BELOW THE REPORTING THRESHOLD OF SCHEDULE I, PART II. |
| FORM 990, PART XI, LINE 9: | DONATED CAPITAL 142. NET CHANGE IN MEMBERSHIP 445. OTHER COMPREHENSIVE INCOME (LOSS) - PROVISION FOR PENSIONS & BENEFITS 367,000. PATRONAGE CAPITAL ASSIGNED 4,961,895. PATRONAGE CAPITAL RETIRED -72,152. UNCLAIMED PATRONAGE CAPITAL RETAINED -2,537. |
| FORM 990, PART X, LINES 17 AND 25 | THE COOPERATIVE PREVIOUSLY INCLUDED ACCRUED EXPENSES COMPRISED OF ACCRUED EMPLOYEE BENEFITS AND OTHER ACCRUED EXPENSES AND DEFERRED CREDITS AS COMPONENTS OF OTHER LIABILITIES ON LINE 25 OF PART X. HOWEVER, FOR THE 2015 CALENDAR YEAR, THE COOPERATIVE BEGAN REPORTING THESE AMOUNTS ON LINE 17 IN ACCORDANCE WITH FORM 990 INSTRUCTIONS. TO INCREASE CONSISTENCY, ACCRUED EXPENSES IN THE AMOUNT OF $987,179 FOR THE 2014 CALENDAR YEAR HAVE BEEN RECLASSIFIED FROM LINE 25 TO LINE 17. |
For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.
Cat. No. 51056K
Schedule O (Form 990 or 990-EZ) 2015
Additional Data
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