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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
NORTHWESTERN ELECTRIC COOPERATIVE INC
Employer identification number
73-0375825
73-0375825
| Return Reference | Explanation |
|---|---|
| Form 990, Part VI, Section A, line 2 | TYSON LITTAU (CEO) AND RAY SMITH (VICE PRESIDENT) BOTH SERVED ON THE BOARD OF WESTERN FARMERS ELECTRIC COOPERATIVE AT THE REQUEST OF AND FOR THE BENEFIT OF THE COOPERATIVE. |
| 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 VOTING 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.AMENDMENTS TO THE ARTICLES OF INCORPORATION; AND 5.AMENDMENTS TO THE COOPERATIVE'S BYLAWS. |
| Form 990, Part VI, Section A, line 8b | FROM TIME TO TIME THE ENTIRE BOARD WILL GO INTO EXECUTIVE SESSION FOR DISCUSSING ITEMS OF A SENSITIVE AND CONFIDENTIAL NATURE. WHEN THIS OCCURS MANAGEMENT AND OTHERS IN ATTENDANCE ARE REMOVED FROM THE MEETING ROOM. ITEMS DISCUSSED IN EXECUTIVE SESSION ARE NOT DOCUMENTED. HOWEVER, ACTIONS TAKEN BY THE BOARD AFTER EXECUTIVE SESSIONS ARE ADJOURNED ARE FULLY DOCUMENTED IN THE WRITTEN MINUTES. |
| Form 990, Part VI, Section B, line 11 | MANAGEMENT PRESENTED A COPY OF THE FORM 990 TO THE BOARD FOR DISCUSSION 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 12c | THE BOARD OF TRUSTEES AND OFFICERS ARE REQUIRED TO REVIEW AND BE FAMILIAR WITH THE POLICIES OUTLINED IN THE COOPERATIVE'S CONFLICT OF INTEREST POLICY. THE BOARD OF TRUSTEES AND OFFICERS ARE REQUIRED TO DISCLOSE ANY ACTION OR SITUATION THAT MIGHT VIOLATE THE POLICY TO THE FULL BOARD OF TRUSTEES AS SOON AS POSSIBLE. THE CONFLICT OF INTEREST POLICY IS REVIEWED AND REDISTRIBUTED TO EACH EMPLOYEE, OFFICER AND DIRECTOR AT LEAST ONCE EVERY OTHER YEAR. |
| Form 990, Part VI, Section B, line 15 | THE BOARD OF TRUSTEES USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE CEO. THE SURVEY SHOWS COMPARATIVE SALARIES FOR CEOS FROM SIMILARLY SITUATED COOPERATIVES LOCATED IN OKLAHOMA AND THE NATION. THE CEO, BOARD OF TRUSTEES, AND AN INDEPENDENT COMPENSATION CONSULTANT USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE COOPERATIVE'S OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEES, IF ANY. THE SURVEY INCLUDES SALARIES FROM SIMILARLY SITUATED COOPERATIVES THROUGHOUT OKLAHOMA AND THE NATION. |
| Form 990, Part VI, Section C, line 19 | THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF ITS GOVERNING DOCUMENTS, EXTERNAL POLICIES, AND AUDITED FINANCIAL STATEMENTS TO ANY MEMBER WHO REQUESTS A COPY OF ANY SUCH DOCUMENT. ANNUALLY THE COOPERATIVE PROVIDES THE YEAR END BALANCE SHEET AND INCOME STATEMENT TO THE MEMBERS OF THE COOPERATIVE WITH THE ANNUAL MEETING NOTICE AND ANNUAL REPORT. ADDITIONALLY AN OPERATING REPORT, WHICH SUMMARIZES VARIOUS FINANCIAL STATISTICS, IS PUBLISHED IN AND DISTRIBUTED TO THE MEMBERS VIA MONTHLY NEWSLETTER. THE COOPERATIVE'S BYLAWS ARE ALSO MADE AVAILABLE ON THE COOPERATIVE'S WEBSITE. |
| 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 OFFICER AND HIGHLY COMPENSATED EMPLOYEES, MEETING THE ELIGIBILITY REQUIREMENTS OF SUCH PLANS. THE COOPERATIVE ALSO PROVIDES HEALTH, DENTAL AND LIFE INSURANCE TO ALL ELIGIBLE EMPLOYEES THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICER AND HIGHLY COMPENSATED EMPLOYEES 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. IN ADDITION TO THE ABOVE BENEFIT 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 VII, Section A | THE BOARD OF TRUSTEES CONSIDERS THE CEO TO BE BOTH THE TOP MANAGEMENT OFFICIAL AND THE TOP FINANCIAL OFFICIAL. THEREFORE, ONLY THE CEO IS LISTED AS AN EMPLOYEE OFFICER. |
| 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 ORGANIZATION TO ITS MEMBERS. |
| Form 990, Part IX | THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE RURAL UTILITIES SERVICE (RUS) UNIFORM SYSTEM OF ACCOUNTS AS PRESCRIBED RUS ELECTRIC BORROWERS. 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 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 UNIFORM SYSTEM OF ACCOUNTS. |
| 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 THE AMOUNTS REPORTED ON LINES 5-7 TO TOTAL WAGES ACCRUED AND/OR PAID: TOTAL PER LINES 5-7 $ 2,802,963 LESS TRUSTEES FEES REPORTED ON 1099-MISC (160,072) LESS EMPLOYEE OFFICER BENEFITS REPORTED ON LINE 5 (95,399) PLUS SALARIES AND WAGES ALLOCATED TO NONOPERATING MARGINS 452 PLUS SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 867,464 PLUS SALARIES AND WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 369,161 TOTAL WAGES ACCRUED AND/OR PAID $3,784,569 |
| Form 990, Part IX, Line 24 | ADMINISTRATIVE AND GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: OFFICE SUPPLIES AND EXPENSES $ 311,552 OUTSIDE SERVICES EMPLOYED 52,340 EMPLOYEE EXPENSE 138,406 TRUSTEES' EXPENSE 56,716 INJURIES AND DAMAGES 62,817 PROPERTY & GENERAL LIABILITY INSURANCE 92,016 DUES TO ASSOCIATED ORGANIZATIONS 102,680 ANNUAL AND DISTRICT MEETING EXPENSE 78,788 MISCELLANEOUS GENERAL EXPENSE 33,137 MAINTENANCE OF GENERAL PLANT 34,701 TOTAL ADMINISTRATIVE AND GENERAL EXPENSE PER 990 $ 963,153 |
| 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. EXCESS OF OPERATING COSTS AND EXPENSES PROPERLY CHARGEABLE AGAINST SUCH SERVICES (I.E. MARGINS FROM THE PROVISION OF ELECTRIC ENERGY). 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 24E | OTHER EXPENSES IS COMPRISED OF THE FOLLOWING: CUSTOMER SERVICE $ 338,224 OTHER DEDUCTIONS 65,646 TOTAL OTHER EXPENSES PER FORM 990, LINE 24E $ 403,870 |
| 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 X, LINES 17 AND 25 | THE COOPERATIVE PREVIOUSLY INCLUDED "ACCRUED PAYROLL AND COMPENSATED ABSENCES AND "OTHER CURRENT ACCRUED LIABILITES" 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 99O INSTRUCTIONS. TO INCREASE CONSISTENCY, THE AMOUNT OF $298,298 FOR "ACCRUED PAYROLL AND COMPENSATED ABSENCES AND $3,070 FOR "OTHER CURRENT ACCRUED LIABILITES" FOR THE 2014 CALENDAR YEAR HAVE BEEN RECLASSED FROM LINE 25 TO LINE 17. |
| Form 990, Part XI, line 9: | NET CHANGE IN MEMBERSHIPS -203,369. PATRONAGE CAPITAL ASSIGNABLE 2,228,123. PATRONAGE CAPITAL RETIRED - TOTAL -1,035,347. PATRONAGE CAPITAL RETIRED - DISCOUNT 22,680. UNCLAIMED PATRONAGE CAPITAL RETIREMENT CHECKS 225,865. |
| Service | 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. |
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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