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.
Go to www.irs.gov/Form990 for the latest information.
OMB No. 1545-0047
2020
Open to Public
Inspection
Inspection
Name of the organization
DAIRYLAND POWER COOPERATIVE
Employer identification number
39-0233059
39-0233059
| Return Reference | Explanation |
|---|---|
| Form 990, Part IV, Line 12a | The consolidated financial statements include the accounts of Dairyland Power Cooperative and Dairyland's wholly owned subsidiary, Genoa FuelTech, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. |
| Form 990, Part VI, Section A, Line 1a | Dairyland's Board of Directors receive advice and recommendations for action from an Executive Committee, made up of members of the Board of Directors only. The executive Committee is authorized by the bylaws to act on behalf of the Board on certain matters between meetings of the full Board. |
| Form 990, Part VI, Section A, Line 4 | Due to the COVID-19 pandemic, the business of Dairyland's 2020 Annual Meeting was handled by unanimous written consent of the membership without convening an in-person meeting; no changes were made in 2020 to the Articles or Bylaws, either in that written consent in lieu of meeting or otherwise. |
| Form 990, Part VI, Section A, Line 6 | Dairyland Power Cooperative provides wholesale electric service and other services to five classes of members (A C, D, E and Special Services). |
| Form 990, Part VI, Section A, Line 7a | Member control of Dairyland is vested in its Board of Directors, consisting of representatives from each of the 24 Class A member distribution cooperatives. Each director is nominated by his or her member cooperative, and then elected by Dairyland's membership at Dairyland's annual meeting in June to serve a one-year term. |
| Form 990, Part VI, Section A, Line 7b | Pursuant to Dairyland's Bylaws, the Board of Directors is charged with directing the management of the Cooperative. The Bylaws provide for the Board to be advised by a technical advisory committee consisting of the managers of the member distribution cooperatives. Member approval is required for amendments to the Articles of Incorporation or Bylaws for merger or consolidation, or for sale of more than 10% of the Cooperative's property. |
| Form 990, Part VI, Section B, Line 11b | Prior to filing the Form 990, approval of the draft return was obtained at the August 5, 2021 meeting of the Board of Directors' Audit & Risk Management Committee. The Committee then presented its report on the return to the full Board at its August 2021 meeting. A copy of the draft return was provided to each board member. Following approval by the Board, the Form 990 was finalized and filed. |
| Form 990, Part VI, Section B, Line 12c | During June of each year, each director on the newly-elected Board is given a copy of Dairyland's Board Policy B109 Business Ethics and a Business Ethics disclosure report to be completed in accordance with Policy B109. A similar disclosure report is required of all Dairyland employees during the first quarter of each year. Each Director's completed report is reviewed by the Chairman of the Audit & Risk Committee. Any questions are reviewed by Dairyland's outside General Counsel. Any unique responses are presented to the full Committee in executive session. Each employee's report is reviewed by the President and CEO and Chief Member Relations and HR Officer. The Chief Member Relations and HR Officer's report, the report of the President and CEO, and the report of any other employee containing any unique responses are reviewed by the Chairman of the Audit & Risk Management Committee and the Chairman of the Board of Directors, and as appropriate by General Counsel and the full Committee. |
| Form 990, Part VI, Section B, Line 15 | Pursuant to a written policy and guidelines adopted by the Board, the process for determining the compensation in 2020 of both Dairyland's former President and CEO Barbara Nick (who retired effective July 17, 2020) and her successor Brent Ridge (who started on July 13, 2020) followed all three of the listed criteria - review and approval by independent persons, comparability data and contemporaneous substantiation of the deliberations and decisions. This process was followed in 2019 for the retired President and CEO (as described in Dairyland's 2019 Form 990) and in June 2020 for current President and CEO Ridge. In the latter case, the CEO Search Committee, made up of independent Board members, and the full Board, had available to them compensation survey data from comparable generation & transmission cooperatives as well as compensation information from the Committee's third-party search consultant, all of which was taken into account in establishing a target range early in the search process and in negotiating and reaching agreement on an initial-year compensation package with the Board's chosen candidate at the conclusion of the process. The Committee's deliberations and recommendations and the Board's deliberations and decision are described in contemporaneous minutes of their respective executive sessions. For Executive Staff/Key Employees, the HR Business Partner conducts an annual salary increase percentages survey of similar Generation & Transmission Cooperatives and obtains comparable salary data compiled by National Rural Electric Cooperative Association (NRECA), along with survey results conducted by an outside compensation consultant. The results of the surveys, along with current and previous salary information, are presented to the President and CEO. Based on the information provided, the President and CEO determines the applicable compensation for each Key Employee. They included Chief Financial Officer and Executive Vice President, Chief Operating Officer, Chief Member Relations and HR Officer, Vice President of Power Supply, Vice President of External and Member Relations, Vice President of Government and Community Relations, Chief Information Officer, Chief Risk Officer, and Chief Strategy Officer. For the tax year covered by this return, this was done in September of 2020. The Executive Staff/Key Employees did receive compensation increases in October of 2020. |
| Form 990, Part VI, Section B, Line 16a | Weston 4, near Wausau, in central Wisconsin, is a 595-megawatt electric generator that uses clean coal technologies. Weston 4 began operating on June 30, 2008. Wisconsin Public Services owns 70% and Dairyland Power Cooperative owns 30%. It is not operated as a joint venture or similar arrangement. |
| Form 990, Part VI, Section C, Line 19 | Dairyland Power Cooperative makes its governing documents, conflict of interest policy, and financial statements available upon request to the public. |
| Form 990, Part VII, Section A, Line 1a | Members of the Board of Directors of Dairyland serve annual terms that run from the annual meeting of members in June of the year of election to the annual meeting in June of the following year. All average hours worked per week were based on a separate questionnaire, specific to the Form 990 filing, that was completed by all directors, officers, key employees and highly compensated employees. |
| Form 990, Part VIII, Line 2a - 2e | Other operating revenue primarily includes revenue received from transmission service and is recorded as services are provided. |
| Form 990, Part VIII, Line 3 | Included in the $1,611,443 is an investment gain, including fund expenses, on nuclear decommissioning funds of $9,026 recorded as decommissioning liabilities of $9,026. |
| Form 990, Part IX, Line 4 | Dairyland Power Cooperative's Board of Directors has adopted a policy of retiring capital credits allocated to members on a first-in, first-out basis. As part of an equity development strategy adopted in 2003, patronage capital retired will be limited to no greater than 2% of the total assigned patronage capital balance as of December 31 of the prior year. This policy is subject to annual review and approval by the Board of Directors and the RUS. During 2020, as a result of the COVID-19 pandemic, the Board of Directors approved capital credit retirements at 5% of net patronage capital. This one-time increase was to provide relief to the Class A member cooperatives and enable them to provide relief to their end-use members. The Board determined that the one-time increase would neither impair the financial condition of Dairyland nor violate the terms of the indenture of mortgage or any outstanding loan agreements that Dairyland is party to. Accordingly, $11,548,703 was retired in 2020. Implementation of this policy is subject to annual review and approval by the Board of Directors and the Rural Utilities Service, and no cash retirements are made which would impair the financial condition of the Cooperative or violate any terms of its agreements. Since 2003, the amount of non-operating margins assigned to members each year is at the discretion of the Board of Directors. Any unassigned non-operating margins will become unallocated reserves and part of permanent equity. Patronage capital as of December 31, 2020 included 2020 margins allocated/assignable of $13,713,315 and unallocated reserves of $1,992,306. It is our interpretation of federal cooperative tax law to report capital credits allocated during the tax year of $13,713,315 on Form 990, Part IX, Line 4. |
| Form 990, Part X, Line 15 | Dairyland Power Cooperative's accounting policies and the consolidated financial statements conform to accounting principles generally accepted in the United States of America applicable to electric cooperatives. During 2020, the Cooperative established a regulatory asset related to the unrecovered plant balances upon closure of the Genoa #3 generating station expected in 2021. A second regulatory asset was also established in 2020 and relates to the retirements and retention programs associated with the Genoa Station #3 closure. In 2020, Dairyland began accelerating depreciation of plant assets related to Genoa #3 which was recorded against the regulatory assets. Accelerated depreciation will continue to occur until the book value is zero at the closure date. The revenue recognition related to the GRE prepayment was also accelerated to coincide with the expected plant closure date. The regulatory asset related to the Genoa Station #3 closure will be amortized through rates over 8 years beginning in 2022. The December 31, 2020 balance associated with the unrecovered plant balance was $16,138,757. The expected following year's portion of these regulatory assets is included in prepaid expenses and other current assets at December 31, 2020. In addition, Part X Line 15 also includes $8,000,000 in segregated cash related to the regulatory liability revenue deferral plan that was established by the Board of Directors and approved by the Rural Utility Service. Additional information related to this plan is discussed in Schedule D, Part XIII. |
| Form 990, Part XI, Line 9 | Other change in net assets or fund balance is a result of: patronage capital-retired of -$11,548,703, accumulated other comprehensive loss of $552,028, and allocation of capital credits for 2020 of $13,713,315. |
For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.
Cat. No. 51056K
Schedule O (Form 990 or 990-EZ) 2020
Additional Data
| Software ID: | 20012124 |
| Software Version: | v1.00 |