Form990-PF

Department of the Treasury
Internal Revenue Service

Return of Private Foundation
or Section 4947(a)(1) Trust Treated as Private Foundation
bulletDo not enter social security numbers on this form as it may be made public.
bulletInformation about Form 990-PF and its instructions is at www.irs.gov/form990pf.
OMB No. 1545-0052
2014
Open to Public Inspection
For calendar year 2014, or tax year beginning 2014, and ending , 20
Name of foundation
ED RACHAL FOUNDATION
 

Number and street (or P.O. box number if mail is not delivered to street address)555 N CARANCAHUA ST SUITE 700   Room/suite
City or town, state or province, country, and ZIP or foreign postal code
CORPUS CHRISTI, TX784010899
A Employer identification number

74-1116595
B Telephone number (see instructions)

(361) 881-9040
C bullet
G Check all that apply:

D 1. bullet
2. bullet
E bullet
H Check type of organization:
I Fair market value of all assets at end
of year (from Part II, col. (c),
line 16)bullet$463,258,326J Accounting method:
 
(Part I, column (d) must be on cash basis.)
F bullet
Part I Analysis of Revenue and Expenses (The total of amounts in columns (b), (c), and (d) may not necessarily equal the amounts in column (a) (see instructions).) (a) Revenue and
expenses per
books 		(b) Net investment
income 		(c) Adjusted net
income 		(d) Disbursements
for charitable
purposes
(cash basis only)
Revenue 1 Contributions, gifts, grants, etc., received (attach
schedule)..............  
2 Check bullet
Sch. B ...............
3 Interest on savings and temporary cash investments      
4 Dividends and interest from securities...... 6,224,933 6,224,933  
5a Gross rents.............. 6,447,018 6,447,018  
b Net rental income or (loss) 5,907,588
6a Net gain or (loss) from sale of assets not on line 10 182,084
b Gross sales price for all assets on line 6a 27,903,535
7 Capital gain net income (from Part IV, line 2)... 182,084
8 Net short-term capital gain.........  
9 Income modifications...........  
10a Gross sales less returns and allowances  
b Less: Cost of goods sold....  
c Gross profit or (loss) (attach schedule).....    
11 Other income (attach schedule)....... Click to see attachment 74,211,082 74,340,709  
12 Total. Add lines 1 through 11........ 87,065,117 87,194,744  
Operating and Administrative Expenses 13 Compensation of officers, directors, trustees, etc. 911,435 509,631   401,804
14 Other employee salaries and wages...... 224,570 113,518   111,052
15 Pension plans, employee benefits....... 130,875 64,893   65,982
16a Legal fees (attach schedule)......... Click to see attachment 199,154 183,642   15,512
b Accounting fees (attach schedule)....... Click to see attachment 16,600 8,300   8,300
c Other professional fees (attach schedule).... Click to see attachment 288,890 250,790   38,100
17 Interest...............        
18 Taxes (attach schedule) (see instructions)... Click to see attachment 4,379,135 2,721,159   5,267
19 Depreciation (attach schedule) and depletion... Click to see attachment 144,910 125,272  
20 Occupancy.............. 71,787 29,644   42,143
21 Travel, conferences, and meetings....... 62,690 21,232   41,458
22 Printing and publications.......... 3,328 1,601   1,727
23 Other expenses (attach schedule)....... Click to see attachment 1,654,112 675,075   979,037
24 Total operating and administrative expenses.
Add lines 13 through 23.......... 8,087,486 4,704,757   1,710,382
25 Contributions, gifts, grants paid........ 10,544,365 11,544,365
26 Total expenses and disbursements. Add lines 24 and 25 18,631,851 4,704,757   13,254,747
27 Subtract line 26 from line 12:
a Excess of revenue over expenses and disbursements 68,433,266
b Net investment income (if negative, enter -0-) 82,489,987
c Adjusted net income (if negative, enter -0-)...  
For Paperwork Reduction Act Notice, see instructions.
Cat. No. 11289X Form 990-PF (2014)
Form 990-PF (2014)
Page 2
Part II Balance Sheets Attached schedules and amounts in the description column
should be for end-of-year amounts only. (See instructions.)		 Beginning of year End of year
(a) Book Value (b) Book Value (c) Fair Market Value
Assets 1 Cash—non-interest-bearing............... 118 82 82
2 Savings and temporary cash investments.......... 9,771,365 28,583,226 28,583,226
3 Accounts receivable bullet14,365,265
Less: allowance for doubtful accounts bullet   22,973,427 14,365,265 14,365,265
4 Pledges receivable bullet  
Less: allowance for doubtful accounts bullet        
5 Grants receivable.................      
6 Receivables due from officers, directors, trustees, and other
disqualified persons (attach schedule) (see instructions).....      
7 Other notes and loans receivable (attach schedule) bullet  
Less: allowance for doubtful accounts bullet        
8 Inventories for sale or use...............      
9 Prepaid expenses and deferred charges........... 495,444 842,735 842,735
10a Investments—U.S. and state government obligations (attach schedule) 54,478,997 Click to see attachment70,816,569 70,816,569
b Investments—corporate stock (attach schedule)........ 11,168,054 Click to see attachment9,500,647 9,500,647
c Investments—corporate bonds (attach schedule)........ 25,745,788 Click to see attachment26,621,619 26,621,619
11 Investments—land, buildings, and equipment: basis bullet198,459,807
Less: accumulated depreciation (attach schedule) bullet263,639 196,078,405 Click to see attachment198,196,168 198,196,169
12 Investments—mortgage loans..............      
13 Investments—other (attach schedule)........... 91,191,997 Click to see attachment145,382,109 99,030,109
14 Land, buildings, and equipment: basis bullet15,506,975
Less: accumulated depreciation (attach schedule) bullet205,070 13,377,460 Click to see attachment15,301,905 15,301,905
15 Other assets (describe bullet)      
16 Total assets (to be completed by all filers—see the
instructions. Also, see page 1, item I) 425,281,055 509,610,325 463,258,326
Liabilities 17 Accounts payable and accrued expenses.......... 24,344,080 49,865,165
18 Grants payable.................. 1,000,000  
19 Deferred revenue.................. 7,916,667 2,916,667
20 Loans from officers, directors, trustees, and other disqualified persons    
21 Mortgages and other notes payable (attach schedule)......    
22 Other liabilities (describe bullet)    
23 Total liabilities (add lines 17 through 22).......... 33,260,747 52,781,832
Net Assets or Fund Balances bullet
and complete lines 24 through 26 and lines 30 and 31.
24 Unrestricted................... 392,020,308 456,828,493
25 Temporarily restricted................    
26 Permanently restricted................    
bullet
and complete lines 27 through 31.
27 Capital stock, trust principal, or current funds.........    
28 Paid-in or capital surplus, or land, bldg., and equipment fund    
29 Retained earnings, accumulated income, endowment, or other funds    
30 Total net assets or fund balances (see instructions)...... 392,020,308 456,828,493
31 Total liabilities and net assets/fund balances (see instructions).. 425,281,055 509,610,325
Part III Analysis of Changes in Net Assets or Fund Balances
1 Total net assets or fund balances at beginning of year—Part II, column (a), line 30 (must agree
with end-of-year figure reported on prior year’s return)............... 1 392,020,308
2 Enter amount from Part I, line 27a..................... 2 68,433,266
3 Other increases not included in line 2 (itemize) bulletClick to see attachment 3 364,893
4 Add lines 1, 2, and 3.......................... 4 460,818,467
5 Decreases not included in line 2 (itemize) bulletClick to see attachment 5 3,989,974
6 Total net assets or fund balances at end of year (line 4 minus line 5)—Part II, column (b), line 30. 6 456,828,493
Form 990-PF (2014)
Form 990-PF (2014)
Page 3
Part IV
Capital Gains and Losses for Tax on Investment Income
(a) List and describe the kind(s) of property sold (e.g., real estate,
2-story brick warehouse; or common stock, 200 shs. MLC Co.) 		(b) How acquired
P—Purchase
D—Donation 		(c) Date acquired
(mo., day, yr.) 		(d) Date sold
(mo., day, yr.)
1 a PUBLICLY TRADED SECURITIES P    
b LAND - BORDER PATROL EASEMENT P    
c EQUIPMENT & TOOLS P    
d
e
(e) Gross sales price (f) Depreciation allowed
(or allowable) 		(g) Cost or other basis
plus expense of sale 		(h) Gain or (loss)
(e) plus (f) minus (g)
a 27,783,535   27,592,363 191,172
b 120,000     120,000
c   25,300 154,388 -129,088
d
e
Complete only for assets showing gain in column (h) and owned by the foundation on 12/31/69 (l) Gains (Col. (h) gain minus
col. (k), but not less than -0-) or
Losses (from col.(h))
(i) F.M.V. as of 12/31/69 (j) Adjusted basis
as of 12/31/69 		(k) Excess of col. (i)
over col. (j), if any
a       191,172
b       120,000
c       -129,088
d
e
2 Capital gain net income or (net capital loss) Bracket If gain, also enter in Part I, line 7
If (loss), enter -0- in Part I, line 7		 Bracket 2 182,084
3 Net short-term capital gain or (loss) as defined in sections 1222(5) and (6):
If gain, also enter in Part I, line 8, column (c) (see instructions). If (loss), enter -0-
in Part I, line 8 . . . . . . . . . . . . . . . . 		Bracket 3 182,084
Part V
Qualification Under Section 4940(e) for Reduced Tax on Net Investment Income
(For optional use by domestic private foundations subject to the section 4940(a) tax on net investment income.)

If section 4940(d)(2) applies, leave this part blank.
Was the foundation liable for the section 4942 tax on the distributable amount of any year in the base period?
If "Yes," the foundation does not qualify under section 4940(e). Do not complete this part.
1 Enter the appropriate amount in each column for each year; see instructions before making any entries.
(a)
Base period years Calendar
year (or tax year beginning in) 		(b)
Adjusted qualifying distributions 		(c)
Net value of noncharitable-use assets 		(d)
Distribution ratio
(col. (b) divided by col. (c))
2013 17,793,839 314,661,763 0.056549
2012 10,969,967 160,524,811 0.068338
2011 6,285,041 115,803,872 0.054273
2010 4,638,181 96,526,303 0.048051
2009 3,198,714 55,876,805 0.057246
2 Total of line 1, column (d) ...................... 2 0.284457
3 Average distribution ratio for the 5-year base period—divide the total on line 2 by 5, or by
the number of years the foundation has been in existence if less than 5 years. . . 		3 0.056891
4 Enter the net value of noncharitable-use assets for 2014 from Part X, line 5..... 4 393,371,193
5 Multiply line 4 by line 3....................... 5 22,379,281
6 Enter 1% of net investment income (1% of Part I, line 27b)........... 6 824,900
7 Add lines 5 and 6......................... 7 23,204,181
8 Enter qualifying distributions from Part XII, line 4.............. 8 14,861,856
If line 8 is equal to or greater than line 7, check the box in Part VI, line 1b, and complete that part using a 1% tax rate. See
the Part VI instructions.
Form 990-PF (2014)
Form 990-PF (2014)
Page 4
Part VI
Excise Tax Based on Investment Income (Section 4940(a), 4940(b), 4940(e), or 4948—see page 18 of the instructions)
1a Bulletand enter “N/A" on line 1. Bracket
Date of ruling or determination letter:   (attach copy of letter if necessary–see instructions)
b 1 1,649,800
hereBulletand enter 1% of Part I, line 27b...................
c All other domestic foundations enter 2% of line 27b. Exempt foreign organizations enter 4% of Part I, line 12, col. (b)
2 Tax under section 511 (domestic section 4947(a)(1) trusts and taxable foundations only. Others enter -0-) 2  
3 Add lines 1 and 2........................... 3 1,649,800
4 Subtitle A (income) tax (domestic section 4947(a)(1) trusts and taxable foundations only. Others enter -0-) 4  
5 Tax based on investment income. Subtract line 4 from line 3. If zero or less, enter -0- ..... 5 1,649,800
6 Credits/Payments:
a 2014 estimated tax payments and 2013 overpayment credited to 2014 6a 2,495,116
b Exempt foreign organizations—tax withheld at source....... 6b
c Tax paid with application for extension of time to file (Form 8868)... 6c  
d Backup withholding erroneously withheld ........... 6d  
7 Total credits and payments. Add lines 6a through 6d.............. 7 2,495,116
8 Enter any penalty for underpayment of estimated tax. if Form 2220 is attached. 8  
9 Tax due. If the total of lines 5 and 8 is more than line 7, enter amount owed.......Bullet 9  
10 Overpayment. If line 7 is more than the total of lines 5 and 8, enter the amount overpaid...Bullet 10 845,316
11 Enter the amount of line 10 to be: Credited to 2015 estimated taxBullet845,316 RefundedBullet 11  
Part VII-A
Statements Regarding Activities
1a
During the tax year, did the foundation attempt to influence any national, state, or local legislation or did
Yes
No
it participate or intervene in any political campaign? ....................
1a
 
No
b
Did it spend more than $100 during the year (either directly or indirectly) for political purposes (see Instructions
for definition)?.................................
1b
 
No
If the answer is "Yes" to 1a or 1b, attach a detailed description of the activities and copies of any materials
published or distributed by the foundation in connection with the activities.
c
Did the foundation file Form 1120-POL for this year?.....................
1c
 
No
d
Enter the amount (if any) of tax on political expenditures (section 4955) imposed during the year:
(1) On the foundation. bullet$   (2) On foundation managers.bullet$  
e
Enter the reimbursement (if any) paid by the foundation during the year for political expenditure tax imposed
on foundation managers.bullet$  
2
Has the foundation engaged in any activities that have not previously been reported to the IRS?.......
2
 
No
If "Yes," attach a detailed description of the activities.
3
Has the foundation made any changes, not previously reported to the IRS, in its governing instrument, articles
of incorporation, or bylaws, or other similar instruments? If "Yes," attach a conformed copy of the changes....
3
 
No
4a
Did the foundation have unrelated business gross income of $1,000 or more during the year?........
4a
 
No
b
If "Yes," has it filed a tax return on Form 990-T for this year?...................
4b
 
 
5
Was there a liquidation, termination, dissolution, or substantial contraction during the year?.........
5
 
No
If "Yes," attach the statement required by General Instruction T.
6
Are the requirements of section 508(e) (relating to sections 4941 through 4945) satisfied either:
  • By language in the governing instrument, or
  • By state legislation that effectively amends the governing instrument so that no mandatory directions
    • that conflict with the state law remain in the governing instrument?................
    6
    Yes
     
    7
    Did the foundation have at least $5,000 in assets at any time during the year? If "Yes," complete Part II, col. (c),
    and Part XV..................................
    7
    Yes
     
    8a
    Enter the states to which the foundation reports or with which it is registered (see instructions)
    bulletTX
    b
    If the answer is "Yes" to line 7, has the foundation furnished a copy of Form 990-PF to the Attorney
    General (or designate) of each state as required by General Instruction G? If "No," attach explanation .
    8b
    Yes
     
    9
    Is the foundation claiming status as a private operating foundation within the meaning of section 4942(j)(3)
    or 4942(j)(5) for calendar year 2014 or the taxable year beginning in 2014 (see instructions for Part XIV)?
    If "Yes," complete Part XIV.............................
    9
     
    No
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 5
    Part VII-A
    Statements Regarding Activities (continued)
    10
    Did any persons become substantial contributors during the tax year? If "Yes," attach a schedule listing their names
    and addresses. ...............................
    10
     
    No
    11
    At any time during the year, did the foundation, directly or indirectly, own a controlled entity within the
    meaning of section 512(b)(13)? If "Yes," attach schedule. (see instructions) .............
    11
    Yes
     
    12
    Did the foundation make a distribution to a donor advised fund over which the foundation or a disqualified person had
    advisory privileges? If "Yes," attach statement (see instructions).................
    12
     
    No
    13
    Did the foundation comply with the public inspection requirements for its annual returns and exemption application?
    13
    Yes
     
    Website addressbulletWWW.EDRACHAL.ORG
    14
    The books are in care ofbulletPAUL D ALTHEIDE Telephone no.bullet (361) 881-9040
    Located atbullet555 N CARANCAHUA ST SUITE 700CORPUS CHRISTITX ZIP+4bullet78401
    15
    Section 4947(a)(1) nonexempt charitable trusts filing Form 990-PF in lieu of Form 1041.........bullet
    and enter the amount of tax-exempt interest received or accrued during the year ......bullet
    15  
    16 At any time during calendar year 2014, did the foundation have an interest in or a signature or other authority over YesNo
    a bank, securities, or other financial account in a foreign country?
    16   No
    See instructions for exceptions and filing requirements for FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR). If "Yes", enter the name of the foreign country bullet  
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 6
    Part VII-B
    Statements Regarding Activities for Which Form 4720 May Be Required
    File Form 4720 if any item is checked in the "Yes" column, unless an exception applies.
    Yes
    No
    1a
    During the year did the foundation (either directly or indirectly):
    (1) Engage in the sale or exchange, or leasing of property with a disqualified person?
    (2) Borrow money from, lend money to, or otherwise extend credit to (or accept it from)
    a disqualified person?........................
    (3) Furnish goods, services, or facilities to (or accept them from) a disqualified person?
    (4) Pay compensation to, or pay or reimburse the expenses of, a disqualified person?
    (5) Transfer any income or assets to a disqualified person (or make any of either available
    for the benefit or use of a disqualified person)?.................
    (6) Agree to pay money or property to a government official? (Exception. Check "No"
    if the foundation agreed to make a grant to or to employ the official for a period
    after termination of government service, if terminating within 90 days.).........
    b
    If any answer is "Yes" to 1a(1)–(6), did any of the acts fail to qualify under the exceptions described in Regulations
    section 53.4941(d)-3 or in a current notice regarding disaster assistance (see instructions)? ........
    1b
     
    No
    .........bullet
    c
    Did the foundation engage in a prior year in any of the acts described in 1a, other than excepted acts,
    that were not corrected before the first day of the tax year beginning in 2014?.............
    1c
     
     
    2
    Taxes on failure to distribute income (section 4942) (does not apply for years the foundation was a private
    operating foundation defined in section 4942(j)(3) or 4942(j)(5)):
    a
    At the end of tax year 2014, did the foundation have any undistributed income (lines 6d
    and 6e, Part XIII) for tax year(s) beginning before 2014?...............
    If "Yes," list the years bullet20, 20, 20, 20
    b
    Are there any years listed in 2a for which the foundation is not applying the provisions of section 4942(a)(2)
    (relating to incorrect valuation of assets) to the year’s undistributed income? (If applying section 4942(a)(2)
    to all years listed, answer "No" and attach statement—see instructions.) ..............
    2b
     
     
    c
    If the provisions of section 4942(a)(2) are being applied to any of the years listed in 2a, list the years here.
    bullet20, 20, 20, 20
    3a
    Did the foundation hold more than a 2% direct or indirect interest in any business enterprise at
    any time during the year?........................
    b
    If "Yes," did it have excess business holdings in 2014 as a result of (1) any purchase by the foundation
    or disqualified persons after May 26, 1969; (2) the lapse of the 5-year period (or longer period approved
    by the Commissioner under section 4943(c)(7)) to dispose of holdings acquired by gift or bequest; or (3)
    the lapse of the 10-, 15-, or 20-year first phase holding period? (Use Schedule C, Form 4720, to determine
    if the foundation had excess business holdings in 2014.)....................
    3b
     
    No
    4a
    Did the foundation invest during the year any amount in a manner that would jeopardize its charitable purposes?
    4a
     
    No
    b
    Did the foundation make any investment in a prior year (but after December 31, 1969) that could jeopardize its
    charitable purpose that had not been removed from jeopardy before the first day of the tax year beginning in 2014?
    4b
     
    No
    5a
    During the year did the foundation pay or incur any amount to:
    (1) Carry on propaganda, or otherwise attempt to influence legislation (section 4945(e))?
    (2) Influence the outcome of any specific public election (see section 4955); or to carry
    on, directly or indirectly, any voter registration drive?...............
    (3) Provide a grant to an individual for travel, study, or other similar purposes?
    (4) Provide a grant to an organization other than a charitable, etc., organization described
    in section 4945(d)(4)(A)? (see instructions)..................
    (5) Provide for any purpose other than religious, charitable, scientific, literary, or
    educational purposes, or for the prevention of cruelty to children or animals?........
    b
    If any answer is "Yes" to 5a(1)–(5), did any of the transactions fail to qualify under the exceptions described in
    Regulations section 53.4945 or in a current notice regarding disaster assistance (see instructions)? ......
    5b
     
    No
    .........bullet
    c
    If the answer is "Yes" to question 5a(4), does the foundation claim exemption from the
    tax because it maintained expenditure responsibility for the grant?............
    If "Yes," attach the statement required by Regulations section 53.4945–5(d).
    6a
    Did the foundation, during the year, receive any funds, directly or indirectly, to pay premiums on
    a personal benefit contract?.......................
    b
    Did the foundation, during the year, pay premiums, directly or indirectly, on a personal benefit contract?....
    6b
     
    No
    If "Yes" to 6b, file Form 8870.
    7a
    At any time during the tax year, was the foundation a party to a prohibited tax shelter transaction?
    b
    If yes, did the foundation receive any proceeds or have any net income attributable to the transaction? ....
    7b
     
     
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 7
    Part VIII
    Information About Officers, Directors, Trustees, Foundation Managers, Highly Paid Employees,
    and Contractors
    1 List all officers, directors, trustees, foundation managers and their compensation (see instructions).
    (a) Name and address (b) Title, and average
    hours per week
    devoted to position     		(c) Compensation
     (If not paid, enter
    -0-)     		(d) Contributions to
    employee benefit plans
    and deferred compensation     		(e) Expense account,
    other allowances
    PAUL D ALTHEIDE CEO / SEC
    52.00     		399,000 13,769 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    ROBERT WALKER VICE CHAIR
    4.00     		61,000 0 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    KEN KELLAR MEMBER
    4.00     		19,000 0 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    RICHARD SCHENDEL TREASURER
    4.00     		60,000 0 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    DAVID HOYER BOARD CHAIRM
    6.00     		61,000 0 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    KEN W TRAWICK MEMBER
    4.00     		61,415 0 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    JOHN JOHNSON ASST TREASUR
    4.00     		61,000 0 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    S PAUL BAEN COO
    40.00     		189,020 10,205 0
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    2 Compensation of five highest-paid employees (other than those included on line 1—see instructions). If none, enter “NONE."
    (a) Name and address of each employee paid more than $50,000 (b) Title, and average
    hours per week
    devoted to position     		(c) Compensation (d) Contributions to
    employee benefit
    plans and deferred
    compensation     		(e) Expense account,
    other allowances
    PEGGY SIDLER COMPTROLLER
    32.00     		94,583 13,769  
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    ADELINE DENVIR ADMIN ASST
    32.00     		65,958 25,502  
    555 N CARANCAHUA ST SUITE 700
    CORPUS CHRISTI,TX784010899
    Total number of other employees paid over $50,000...................bullet  
    3 Five highest-paid independent contractors for professional services (see instructions). If none, enter "NONE".
    (a) Name and address of each person paid more than $50,000 (b) Type of service (c) Compensation
     
    Total number of others receiving over $50,000 for professional services.............bullet7
    Part IX-A
    Summary of Direct Charitable Activities
    List the foundation’s four largest direct charitable activities during the tax year. Include relevant statistical information such as the number of organizations and other beneficiaries served, conferences convened, research papers produced, etc. Expenses
    1 EXPENSES INCURRED IN DEVELOPING A RETREAT CENTER FOR QUALIFYING CIVIC COMMUNITY AND NOT-FOR-PROFIT ORGANIZATIONS. USED FOR APPROXIMATELY 3,000 PEOPLE DAYS. 1,710,382
    2  
    3  
    4  
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 8
    Part IX-B
    Summary of Program-Related Investments (see instructions)
    Describe the two largest program-related investments made by the foundation during the tax year on lines 1 and 2. Amount
    1 N/A  
    2  
    All other program-related investments. See instructions.
    3  
    Total. Add lines 1 through 3.........................bullet  
    Part X
    Minimum Investment Return (All domestic foundations must complete this part. Foreign foundations,
    see instructions.)
    1
    Fair market value of assets not used (or held for use) directly in carrying out charitable, etc.,
    purposes:
    a
    Average monthly fair market value of securities...................
    1a
    99,238,854
    b
    Average of monthly cash balances.......................
    1b
    21,588,297
    c
    Fair market value of all other assets (see instructions)................
    1c
    278,534,466
    d
    Total (add lines 1a, b, and c).........................
    1d
    399,361,617
    e
    Reduction claimed for blockage or other factors reported on lines 1a and
    1c (attach detailed explanation) .............
    1e
     
    2
    Acquisition indebtedness applicable to line 1 assets..................
    2
     
    3
    Subtract line 2 from line 1d.........................
    3
    399,361,617
    4
    Cash deemed held for charitable activities. Enter 1 1/2% of line 3 (for greater amount, see
    instructions) .............................
    4
    5,990,424
    5
    Net value of noncharitable-use assets. Subtract line 4 from line 3. Enter here and on Part V, line 4
    5
    393,371,193
    6
    Minimum investment return. Enter 5% of line 5..................
    6
    19,668,560
    Part XI
    Distributable Amount bullet and do not complete this part.)
    1
    Minimum investment return from Part X, line 6....................
    1
    19,668,560
    2a
    Tax on investment income for 2014 from Part VI, line 5......
    2a
    1,649,800
    b
    Income tax for 2014. (This does not include the tax from Part VI.)...
    2b
     
    c
    Add lines 2a and 2b............................
    2c
    1,649,800
    3
    Distributable amount before adjustments. Subtract line 2c from line 1............
    3
    18,018,760
    4
    Recoveries of amounts treated as qualifying distributions................
    4
     
    5
    Add lines 3 and 4............................
    5
    18,018,760
    6
    Deduction from distributable amount (see instructions).................
    6
     
    7
    Distributable amount as adjusted. Subtract line 6 from line 5. Enter here and on Part XIII, line 1 ...
    7
    18,018,760
    Part XII
    Qualifying Distributions (see instructions)
    1
    Amounts paid (including administrative expenses) to accomplish charitable, etc., purposes:
    a
    Expenses, contributions, gifts, etc.—total from Part I, column (d), line 26 ..........
    1a
    13,254,747
    b
    Program-related investments—total from Part IX-B..................
    1b
     
    2
    Amounts paid to acquire assets used (or held for use) directly in carrying out charitable, etc.,
    purposes...............................
    2
    1,607,109
    3
    Amounts set aside for specific charitable projects that satisfy the:
    a
    Suitability test (prior IRS approval required)....................
    3a
     
    b
    Cash distribution test (attach the required schedule) .................
    3b
     
    4
    Qualifying distributions. Add lines 1a through 3b. Enter here and on Part V, line 8, and Part XIII, line 4
    4
    14,861,856
    5
    Foundations that qualify under section 4940(e) for the reduced rate of tax on net investment
    income. Enter 1% of Part I, line 27b (see instructions).................
    5
     
    6
    Adjusted qualifying distributions. Subtract line 5 from line 4..............
    6
    14,861,856
    Note: The amount on line 6 will be used in Part V, column (b), in subsequent years when calculating whether the foundation qualifies for
    the section 4940(e) reduction of tax in those years.
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 9
    Part XIII
    Undistributed Income (see instructions)
    (a)
    Corpus     		(b)
    Years prior to 2013     		(c)
    2013     		(d)
    2014
    1 Distributable amount for 2014 from Part XI, line 7 18,018,760
    2 Undistributed income, if any, as of the end of 2014:
    a Enter amount for 2013 only.......  
    b Total for prior years:20, 20, 20  
    3 Excess distributions carryover, if any, to 2014:
    a From 2009.......  
    b From 2010.......  
    c From 2011....... 856,931
    d From 2012....... 4,221,304
    e From 2013....... 4,667,095
    fTotal of lines 3a through e......... 9,745,330
    4Qualifying distributions for 2014 from Part
    XII, line 4: bullet$ 14,861,856
    a Applied to 2013, but not more than line 2a  
    b Applied to undistributed income of prior years
    (Election required—see instructions).....     		 
    c Treated as distributions out of corpus (Election
    required—see instructions).........     		 
    d Applied to 2014 distributable amount..... 14,861,856
    e Remaining amount distributed out of corpus  
    5 Excess distributions carryover applied to 2014. 3,156,904 3,156,904
    (If an amount appears in column (d), the
    same amount must be shown in column (a).)
    6Enter the net total of each column as
    indicated below:
    a Corpus. Add lines 3f, 4c, and 4e. Subtract line 5 6,588,426
    b Prior years’ undistributed income. Subtract
    line 4b from line 2b ...........     		 
    c Enter the amount of prior years’ undistributed
    income for which a notice of deficiency has
    been issued, or on which the section 4942(a)
    tax has been previously assessed......     		 
    d Subtract line 6c from line 6b. Taxable amount
    —see instructions ...........     		 
    e Undistributed income for 2013. Subtract line
    4a from line 2a. Taxable amount—see
    instructions .............     		 
    f Undistributed income for 2014. Subtract
    lines 4d and 5 from line 1. This amount must
    be distributed in 2015 ..........     		0
    7 Amounts treated as distributions out of
    corpus to satisfy requirements imposed by
    section 170(b)(1)(F) or 4942(g)(3) (Election may
    be required - see instructions) .......     		 
    8Excess distributions carryover from 2009 not
    applied on line 5 or line 7 (see instructions) ...     		 
    9Excess distributions carryover to 2015.
    Subtract lines 7 and 8 from line 6a ......     		6,588,426
    10 Analysis of line 9:
    a Excess from 2010....  
    b Excess from 2011....  
    c Excess from 2012.... 1,921,331
    d Excess from 2013.... 4,667,095
    e Excess from 2014....  
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 10
    Part XIV
    Private Operating Foundations (see instructions and Part VII-A, question 9)
    1a If the foundation has received a ruling or determination letter that it is a private operating
    foundation, and the ruling is effective for 2014, enter the date of the ruling.......bullet
     
    b Check box to indicate whether the organization is a private operating foundation described in section or
    2a Enter the lesser of the adjusted net
    income from Part I or the minimum
    investment return from Part X for each
    year listed ..........     		Tax year Prior 3 years (e) Total
    (a) 2014 (b) 2013 (c) 2012 (d) 2011
             
    b 85% of line 2a .........          
    c Qualifying distributions from Part XII,
    line 4 for each year listed .....     		         
    d Amounts included in line 2c not used
    directly for active conduct of exempt activities ...........     		         
    e Qualifying distributions made directly
    for active conduct of exempt activities.
    Subtract line 2d from line 2c ....     		         
    3 Complete 3a, b, or c for the
    alternative test relied upon:
    a “Assets" alternative test—enter:
    (1) Value of all assets ......          
    (2) Value of assets qualifying
    under section 4942(j)(3)(B)(i)    		          
    b “Endowment" alternative test— enter 2/3
    of minimum investment return shown in
    Part X, line 6 for each year listed...     		         
    c “Support" alternative test—enter:
    (1) Total support other than gross
    investment income (interest,
    dividends, rents, payments
    on securities loans (section
    512(a)(5)), or royalties) ....     		         
    (2) Support from general public
    and 5 or more exempt
    organizations as provided in
    section 4942(j)(3)(B)(iii)....     		         
    (3) Largest amount of support
    from an exempt organization    		          
    (4) Gross investment income          
    Part XV
    Supplementary Information (Complete this part only if the organization had $5,000 or more in
    assets at any time during the year—see instructions.)
    1Information Regarding Foundation Managers:
    aList any managers of the foundation who have contributed more than 2% of the total contributions received by the foundation
    before the close of any tax year (but only if they have contributed more than $5,000). (See section 507(d)(2).)
    bList any managers of the foundation who own 10% or more of the stock of a corporation (or an equally large portion of the
    ownership of a partnership or other entity) of which the foundation has a 10% or greater interest.
    2Information Regarding Contribution, Grant, Gift, Loan, Scholarship, etc., Programs:
    Check here bullet
    aThe name, address, and telephone number or e-mail address of the person to whom applications should be addressed:
    PAUL D ALTHEIDE
    555 N CARANCAHUA SUITE 700
    CORPUS CHRISTI,TX78401
    (361) 881-9040
    bThe form in which applications should be submitted and information and materials they should include:
    SEE FOUNDATION'S WEBSITE, WWW.EDRACHAL.ORG, FOR GUIDELINES AND APPLICATION.
    cAny submission deadlines:
    NO SUBMISSION DEADLINES.
    dAny restrictions or limitations on awards, such as by geographical areas, charitable fields, kinds of institutions, or other
    factors:
    LIMITED GEOGRAPHICALLY TO THE STATE OF TEXAS.
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 11
    Part XV
    Supplementary Information (continued)
    3 Grants and Contributions Paid During the Year or Approved for Future Payment
    Recipient If recipient is an individual,
    show any relationship to
    any foundation manager
    or substantial contributor
    		 Foundation
    status of
    recipient     		Purpose of grant or
    contribution     		Amount
    Name and address (home or business)
    aPaid during the year
    NUECES COUNTY TEXAS
    901 LEOPARD ST
    CORPUS CHRISTI,TX78401     		  GOV PURCHASE OF LAND 1,000,000
    SEE STATEMENT 25
    SEE STMT
    SEE STMT,TX78401     		    SEE STMT 10,544,365
    Total .................................bullet 3a 11,544,365
    bApproved for future payment
    Total .................................bullet 3b  
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 12
    Part XVI-A
    Analysis of Income-Producing Activities
    Enter gross amounts unless otherwise indicated. Unrelated business income Excluded by section 512, 513, or 514 (e)
    Related or exempt
    function income
    (See instructions.)
    1Program service revenue: (a)
    Business code     		(b)
    Amount     		(c)
    Exclusion code     		(d)
    Amount
    a
    b
    c
    d
    e
    f
    gFees and contracts from government agencies          
    2 Membership dues and assessments....          
    3
    Interest on savings and temporary cash investments ............     		         
    4 Dividends and interest from securities....     14 6,224,933  
    5 Net rental income or (loss) from real estate:
    aDebt-financed property......          
    bNot debt-financed property.....     16 5,907,588  
    6
    Net rental income or (loss) from personal property .............     		         
    7 Other investment income.....     15 74,323,448  
    8
    Gain or (loss) from sales of assets other than inventory .............     		    1 182,084  
    9 Net income or (loss) from special events:          
    10 Gross profit or (loss) from sales of inventory..          
    11 Other revenue: aMISCELLANEOUS INCOME     1 2,655  
    bEASEMENTS & ROW     1 14,606  
    cSREG - PASSIVE LOSS CO 525990 -164,898      
    dSTANDARD RENEWABLE ENERGY G 525990 53,367      
    eBAYFRONT MARINA INVESTMENTS 525990 -18,096      
    12 Subtotal. Add columns (b), (d), and (e).. -129,627 86,655,314  
    13Total. Add line 12, columns (b), (d), and (e)..................
    1386,525,687
    (See worksheet in line 13 instructions to verify calculations.)
    Part XVI-B
    Relationship of Activities to the Accomplishment of Exempt Purposes
    Line No.
    DownArrow     		Explain below how each activity for which income is reported in column (e) of Part XVI-A contributed importantly to
    the accomplishment of the foundation’s exempt purposes (other than by providing funds for such purposes). (See
    instructions.)
    Form 990-PF (2014)
    Form 990-PF (2014)
    Page 13
    Part XVII
    Information Regarding Transfers To and Transactions and Relationships With Noncharitable Exempt Organizations
    1
    Did the organization directly or indirectly engage in any of the following with any other organization described in section 501(c) of the Code (other than section 501(c)(3) organizations) or in section 527, relating to political
    Yes
    No
    organizations?
    a
    Transfers from the reporting foundation to a noncharitable exempt organization of:
    (1) Cash...................................
    1a(1)
     
    No
    (2) Other assets.................................
    1a(2)
     
    No
    b
    Other transactions:
    (1) Sales of assets to a noncharitable exempt organization....................
    1b(1)
     
    No
    (2) Purchases of assets from a noncharitable exempt organization..................
    1b(2)
     
    No
    (3) Rental of facilities, equipment, or other assets.......................
    1b(3)
     
    No
    (4) Reimbursement arrangements...........................
    1b(4)
     
    No
    (5) Loans or loan guarantees.............................
    1b(5)
     
    No
    (6) Performance of services or membership or fundraising solicitations................
    1b(6)
     
    No
    c
    Sharing of facilities, equipment, mailing lists, other assets, or paid employees..............
    1c
     
    No
    d
    If the answer to any of the above is "Yes," complete the following schedule. Column (b) should always show the fair market value
    of the goods, other assets, or services given by the reporting foundation. If the foundation received less than fair market value
    in any transaction or sharing arrangement, show in column (d) the value of the goods, other assets, or services received.
    (a) Line No. (b) Amount involved (c) Name of noncharitable exempt organization (d) Description of transfers, transactions, and sharing arrangements
    2a
    Is the foundation directly or indirectly affiliated with, or related to, one or more tax-exempt organizations
    described in section 501(c) of the Code (other than section 501(c)(3)) or in section 527?...........
    b
    If "Yes," complete the following schedule.
    (a) Name of organization (b) Type of organization (c) Description of relationship
    ERF REAL ESTATE INC
    EIN 20-2661759     		501(C)(2) SEE GENERAL FOOTNOTE
    ERF PORT ARANSAS INC
    EIN 46-4468454     		501(C)(2) SEE GENERAL FOOTNOTE
    ERF FLIGHT SERVICES 501(C)(3) SEE GENERAL FOOTNOTE
    ERF TOWER II
    EIN 47-4191656     		501(C)(3) SEE GENERAL FOOTNOTE
    Sign Here
    Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.
    Bullet Bullet
    May the IRS discuss this return
    with the preparer shown below
    (see instr.)?
    Signature of officer or trustee Date Title
    Paid Preparer Use Only Print/Type preparer's name Preparer's Signature Date PTIN
    Firm's namebullet



    Firm's addressbullet







         		Firm's EINbullet
    Phone no.
    Form 990-PF (2014)
    Additional Data


    Software ID:  
    Software Version:  


    Form 990PF - Special Condition Description:
    Special Condition Description

    TY 2014 AccountingFeesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category Amount Net Investment Income Adjusted Net Income Disbursements for Charitable Purposes
    ACCOUNTING FEES 16,600 8,300   8,300

    Note: To capture the full content of this document, please select landscape mode (11" x 8.5") when printing.

    TY 2014 DepreciationSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Description of Property Date Acquired Cost or Other Basis Prior Years' Depreciation Computation Method Rate /
    Life (# of years)    		 Current Year's Depreciation Expense Net Investment Income Adjusted Net Income Cost of Goods Sold Not Included
          133,425     144,910 125,272    

    TY 2014 InvestmentsCorpBondsSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Name of Bond End of Year Book Value End of Year Fair Market Value
    CORPORATE BONDS - SEE STATEMENT 23 26,621,619 26,621,619

    TY 2014 InvestmentsCorpStockSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Name of Stock End of Year Book Value End of Year Fair Market Value
    CORPORATE STOCK - SEE STATEMENT 22 9,500,647 9,500,647

    TY 2014 InvestmentsGovtObligationsSch
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    US Government Securities - End of Year Book Value:

    70,816,569
    US Government Securities - End of Year Fair Market Value:

    70,816,569
    State & Local Government Securities - End of Year Book Value:


     
    State & Local Government Securities - End of Year Fair Market Value:


     


    TY 2014 InvestmentsLandSchedule2
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category/ Item Cost/Other Basis Accumulated Depreciation Book Value End of Year Fair Market Value
    LAND 66,252,725   66,252,725 66,622,842
    LAND IMPROVEMENTS 29,748 11,947 17,801  
    BLDGS & LEASEHOLD IMPROVEMENTS 5,133,726 190,595 4,943,131 5,129,683
    FURNITURE & EQUIPMENT 133,763 60,007 73,756 59,700
    EQUIPMENT & TOOLS 4,175 99 4,076 3,500
    EASEMENTS 1   1  
    SOFTWARE 4,368 991 3,377 1,500
    UNREALIZED APPRECIATION ON ASSETS 522,357   522,357  
    MINERAL INTERESTS 126,378,944   126,378,944 126,378,944

    TY 2014 InvestmentsOtherSchedule2
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category/ Item Listed at Cost or FMV Book Value End of Year Fair Market Value
    STANDARD RENEWABLE ENERGY FMV 150,000 150,000
    BAYFRONT MARINA PARTNERSHIP FMV 20,042 20,042
    CITY OF CORPUS CHRISTI BONDS FMV 2,600,000 2,600,000
    NOTES RECEIVABLE FMV 83,766,607 83,766,607
    REVOLVING CREDIT NOTES FMV 12,493,460 12,493,460
    LOAN COMMITMENTS FMV 46,352,000  

    TY 2014 LandEtcSchedule2
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category / Item Cost / Other Basis Accumulated Depreciation Book Value End of Year Fair Market Value
    BLDGS & LEASEHOLD IMPROVEMENTS 2,655,912 167,366 2,488,546 1,928,096
    LAND IMPROVEMENTS 2,589,341 37,704 2,551,637 2,159,612
    FURNITURE & EQUIPMENT 18,409   18,409 8,400
    EQUIPMENT & TOOLS 708,927   708,927 476,900
    VEHICLES 67,229   67,229 60,000
    PILATUS 3,699,986   3,699,986 3,699,986
    SOFTWARE 4,195   4,195 1,000
    UNREALIZED APPRECIATION ON ASSETS 675,067   675,067  
    LAND 5,087,909   5,087,909 6,967,911
    UNREALIZED APPRECIATION ON LAND        


    TY 2014 LegalFeesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category Amount Net Investment Income Adjusted Net Income Disbursements for Charitable Purposes
    INVESTMENT & TAX COMPLIANCE 183,642 183,642    
    EXEMPT PURPOSE 15,512     15,512


    TY 2014 OtherDecreasesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Description Amount
       
       


    TY 2014 OtherExpensesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Description Revenue and Expenses per Books Net Investment Income Adjusted Net Income Disbursements for Charitable Purposes
    EXPENSES        
    PILATUS AIRPLANE EXPENSE 19,047 19,047    
    BAD DEBT EXPENSE 250,000 250,000    
    BOARD EXPENSE 27,196 18,132   9,064
    ROTC COSTS 58,411     58,411
    MCGLOIN EXPENSES 1,047     1,047
    CONTRACT LABOR 519,271 83,940   435,331
    FUEL & OIL 11,374 45   11,329
    INSURANCE 119,322 61,119   58,203
    MACHINE HIRE 10,264 56   10,208
    MISCELLANEOUS 1,050 1,050    
    OFFICE EXPENSE 32,991 14,624   18,367
    RANCH SUPPLIES 84,621 521   84,100
    REPAIRS & MAINTENANCE 30,551 1,066   29,485
    SEMINARS DUES & FEES 33,768 2,929   30,839
    TRAINING 10,107     10,107
    ACCRUED VACATION & SICK LEAVE 445,092 222,546   222,546


    TY 2014 OtherIncomeSchedule2
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Description Revenue And Expenses Per Books Net Investment Income Adjusted Net Income
    ROYALTIES - GALVAN RANCH 74,309,196 74,309,196  
    ROYALTIES - EL DESCONSO 14,252 14,252  
    MISCELLANEOUS INCOME 2,655 2,655  
    EASEMENTS & ROW 14,606 14,606  
    SREG - PASSIVE LOSS CO -164,898    
    STANDARD RENEWABLE ENERGY GRP 53,367    
    BAYFRONT MARINA INVESTMENTS -18,096    


    TY 2014 OtherIncreasesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Description Amount
       
       


    TY 2014 OtherProfessionalFeesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category Amount Net Investment Income Adjusted Net Income Disbursements for Charitable Purposes
    CONSULTING - OIL & GAS 50,082 50,082    
    CONSULTING - REAL ESTATE 41,496 41,496    
    CONSULTING - INVESTMENTS 50,000 50,000    
    CONSULTING - EXEMPT PURPOSE 38,100     38,100
    INVESTMENT CHARGES & FEES 94,212 94,212    
    FARM RENTAL INCOME 15,000      


    TY 2014 TaxesSchedule
    Name:
    ED RACHAL FOUNDATION
    EIN: 74-1116595
    Category Amount Net Investment Income Adjusted Net Income Disbursements for Charitable Purposes
    FOREIGN TAXES 2,046 2,046    
    EXCISE TAXES 1,652,709      
    AD VALOREM TAXES 2,199,950 2,194,683   5,267
    RENT INCOME 482,241      
    FARM RENTAL INCOME 42,189