TIN:
SCHEDULE O
(Form 990)
Department of the Treasury
Internal Revenue Service
(Form 990)
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
2021
Open to Public
Inspection
Inspection
Name of the organization
GRAHAM COUNTY ELECTRIC COOPERATIVE INC
Employer identification number
86-0079733
86-0079733
| Return Reference | Explanation |
|---|---|
| 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 NET INCOME OF $179,540, WHICH IS THE EFFECT OF NON-OPERATING MARGINS RETAINED. THE FOLLOWING SCHEDULE IS PROVIDED TO FURTHER EXPLAIN THE IMPACT OF THIS TRANSACTION: ADD: NON-OPERATING MARGINS RETAINED 179,866 LESS: OTHER ADJUSTMENTS (326) (A) - NET INCOME ON PAGE 1, PART I, LINE 19 $ 179,540 (B) - BENEFITS PAID TO MEMBERS (I.E. PATRONAGE DIVIDENDS), PART I, LINE 14 $ 2,212,096 TOTAL 2021 NET MARGIN PER FINANCIAL STATEMENTS (A + B) $ 2,391,636 |
| FORM 990, PART VI, SECTION A, LINE 2 | A BUSINESS RELATIONSHIP EXISTS BETWEEN DIRECTORS GENE ROBERT LARSON, TOMMY CLONTS, GERALD SCHMIDT, JIM BRYCE, DENNIS JACOB, AND STEPHEN HOOPER WHO ALL SERVE ON THE BOARD OF GRAHAM COUNTY UTILITIES AT THE REQUEST OF AND FOR THE BENEFIT OF THE COOPERATIVE. IN ADDITION, A BUSINESS RELATIONSHIP EXISTS BETWEEN DIRECTORS GENE ROBERT LARSON AND REUBEN MCBRIDE AT ARIZONA ELECTRIC POWER COOPERATIVE. |
| FORM 990, PART VI, SECTION A, LINE 4 | DURING THE YEAR, THE COOPERATIVE'S BYLAWS WERE AMENDED. THE FOLLOWING IS A SUMMARY OF THE CHANGES MADE: ARTICLE I - MEMBERSHIP SECTION 1. REQUIREMENTS FOR MEMBERSHIP, WAS AMENDED TO REMOVE THE PARAGRAPH STATING "AT EACH MEETING OF THE MEMBERS HELD SUBSEQUENT TO THE EXPIRATION OF A PERIOD OF SIX MONTHS FROM THE DATE OF INCORPORATION OF THE COOPERATIVE, ALL APPLICATIONS RECEIVED MORE THAN NINETY DAYS PRIOR TO SUCH MEETING WHICH HAVE NOT BEEN ACCEPTED OR WHICH HAVE BEEN REJECTED BY THE BOARD OF DIRECTORS SHALL BE SUBMITTED BY THE SECRETARY TO SUCH MEETING AND, SUBJECT TO COMPLIANCE BY THE APPLICANT WITH THE REQUIREMENTS HEREINABOVE SET FORTH, ANY SUCH APPLICATION MAY BE ACCEPTED BY VOTE OF THE MEMBERS. THE SECRETARY SHALL GIVE EACH SUCH APPLICANT AT LEAST TEN DAYS WRITTEN NOTICE OF THE DATE OF THE MEMBERS' MEETING TO WHICH HIS APPLICATION WILL BE SUBMITTED AND SUCH APPLICANT SHALL BE ENTITLED TO BE PRESENT AND HEARD AT THE MEETING." SECTION 5. MEMBERSHIP FEES, WAS AMENDED TO STATE "THE MEMBERSHIP FEE SHALL BE FIVE DOLLARS, UPON THE PAYMENT OF WHICH A MEMBER SHALL BE ELIGIBLE FOR ONE SERVICE CONNECTION TO THE ELECTRIC DISTRIBUTION SYSTEM AND ONE CONNECTION TO THE WATER DISTRIBUTION SYSTEM IF THE COOPERATIVE OPERATES SUCH A SYSTEM IN THE MEMBER'S LOCATION." SECTION 6. PURCHASE OF ELECTRIC AND/OR WATER SERVICES, WAS AMENDED TO ADD WATER SERVICES AS PART OF THE COOPERATIVE'S OPERATIONS. SECTION 7. TERMINATION OF MEMBERSHIP, AMENDED PART (A) TO STATE "PURCHASE OF UTILITY SERVICES FROM THE COOPERATIVE" RATHER THAN THE PREVIOUS "PURCHASE ENERGY". ARTICLE III - MEETINGS OF MEMBERS SECTION 1. ANNUAL MEETING, WAS AMENDED TO STATE "THE ANNUAL MEETING SHALL BE HELD BEFORE SEPTEMBER 30 EACH YEAR" RATHER THAN THE PREVIOUS "2ND SATURDAY IN FEBRUARY". ARTICLE IV - DIRECTORS SECTION 3. QUALIFICATIONS, AMENDED PART (B) TO STATE "(B) IS IN ANY WAY EMPLOYED BY OR FINANCIALLY INTERESTED IN (I) AN ENTITY OR ENTERPRISE THAT COMPETES WITH THE COOPERATIVE IN THE SALE OF UTILITY SERVICES, OR (II) AN ENTITY OR ENTERPRISE THAT COMPETES WITH THE COOPERATIVE IN THE SALE OF WATER, OR (III) AN ENTITY THAT RECEIVES FROM OR PROVIDES WHOLESALE UTILITY SERVICES TO THE COOPERATIVE (EXCEPTION AEPCO, SIERRA SOUTHWEST BOARD MEMBERSHIP), OR (IV) AN ENTITY OR ENTERPRISE SELLING ELECTRICAL ENERGY TO THE COOPERATIVE, OR (V) AN ENTITY OR ENTERPRISE PRIMARILY ENGAGED IN THE SALE OF ELECTRICAL OR PLUMBING APPLIANCES, FIXTURES OR SUPPLIES TO THE MEMBERS OF THE COOPERATIVE." SECTION 5. NOMINATIONS AND ELECTION OF DIRECTORS, ADDED PART (H) TO STATE "(H) IF AN ELECTION IS UNCONTESTED BY A QUALIFIED CANDIDATE, THEN THE BOARD OF DIRECTORS MAY FORGO THE ELECTION PROCESS." SECTION 8. COMPENSATION, WAS AMENDED TO STATE "DIRECTORS SHALL NOT RECEIVE SALARIES FOR THEIR SERVICES AS DIRECTORS, EXCEPT THAT BY RESOLUTION OF THE BOARD OF DIRECTORS A FIXED FEE FOR ATTENDANCE AT BOARD MEETINGS MAY BE ESTABLISHED FROM TIME TO TIME BY THE MAJORITY APPROVAL OF THE BOARD OF DIRECTORS. THIS RATE MAY BE UP TO THE AVERAGE COMPENSATION RATE FOR ELECTRICAL DISTRIBUTION COOPERATIVE BOARD OF DIRECTORS IN THE STATE OF ARIZONA. DIRECTORS SHALL ALSO BE PAID AN ATTENDANCE FEE AND SHALL BE REIMBURSED FOR OUT-OF-POCKET EXPENSES INCURRED FOR REPRESENTATION ON OUTSIDE COMMITTEES AND BOARDS AS APPROVED BY THE BOARD OF DIRECTORS. NO DIRECTOR SHALL RECEIVE COMPENSATION FOR SERVING THE COOPERATIVE IN ANY OTHER CAPACITY, NOR SHALL ANY CLOSE RELATIVE OF A DIRECTOR RECEIVE COMPENSATION FOR SERVING THE COOPERATIVE, UNLESS (I) THE PAYMENT IS A RESULT OF A COMPETITIVE BID PROCESS IN WHICH THE DIRECTOR INVOLVED DID NOT PARTICIPATE IN THE DRAFTING OF THE BID REQUEST OR IN THE BID APPROVAL PROCESS; OR (II) SERVICE BY THE DIRECTOR OR HIS OR HER CLOSE RELATIVE IS A RESULT OF A SITUATION THAT IS CERTIFIED BY THE BOARD OF DIRECTORS TO HAVE BEEN AN EMERGENCY MEASURE, OR (III) THE HIRING OF THE RELATIVE AS AN EMPLOYEE IS APPROVED BY THE BOARD OF DIRECTORS AND THE POSITION IS NOT AS GENERAL MANAGER OR FINANCE MANAGER." ARTICLE V - MEETINGS OF DIRECTORS SECTION 4. QUORUM, WAS AMENDED TO ADD "ONCE A QUORUM ON THE DIRECTORS IS ESTABLISHED IT SHALL BE A LEGAL MEETING AND WILL CONTINUE TO BE A LEGAL MEETING EVEN IF DIRECTORS LEAVE THE MEETING PRIOR TO ADJOURNMENT." ARTICLE VI - OFFICERS, SECTION 4. PRESIDENT, WAS AMENDED TO REMOVE PART (C) AND ADD IT TO THE END OF THE SECTION, STATING "IN GENERAL, PERFORM ALL DUTIES INCIDENT TO THE OFFICE OF PRESIDENT AND SUCH OTHER DUTIES AS MAY BE PRESCRIBED BY THE BOARD OF DIRECTORS FROM TIME TO TIME." SECTION 6. SECRETARY, WAS AMENDED TO REMOVE PART (H) AND ADD IT TO THE END OF THE SECTION, STATING "IN GENERAL, PERFORM ALL DUTIES INCIDENT TO THE OFFICE OF SECRETARY AND SUCH OTHER DUTIES AS FROM TIME TO TIME MAY BE ASSIGNED TO HIM BY THE BOARD OF DIRECTORS." SECTION 8. COMPENSATION, WAS AMENDED TO ADD THE BOARD OF DIRECTORS. ARTICLE VII - NON-PROFIT OPERATION SECTION 2. PATRONAGE CAPITAL IN CONNECTION WITH FURNISHING UTILITY SERVICES, WAS AMENDED TO ADD WATER SERVICES AS PART OF THE COOPERATIVE'S OPERATIONS. ARTICLE VIII - DISPOSITION OF PROPERTY, WAS AMENDED TO STATE "UNLESS OTHERWISE PERMITTED BY ARIZONA LAW AS THE SAME EXISTS OR MAY HEREAFTER BE IN EFFECT, THE COOPERATIVE MAY NOT SELL, MORTGAGE, LEASE OR OTHERWISE DISPOSE OF OR ENCUMBER ALL OR ANY SUBSTANTIAL PORTION OF ITS PROPERTY UNLESS SUCH SALE, MORTGAGE, LEASE OR OTHER DISPOSITION OR ENCUMBRANCE IS AUTHORIZED AT A MEETING OF THE MEMBERS THEREOF BY THE AFFIRMATIVE VOTE OF NOT LESS THAN A MAJORITY OF ALL OF THE MEMBERS AT THE MEETING OF THE COOPERATIVE". ARTICLE X - FINANCIAL TRANSACTIONS SECTION 4. CHANGE IN RATES, WAS AMENDED TO CHANGE "ELECTRIC ENERGY" TO "UTILITY SERVICES". ARTICLE XII - AMENDMENTS, WAS AMENDED TO STATE "AS PROVIDED IN THE ARTICLES OF INCORPORATION, THE ORIGINAL BY-LAWS OF THE CORPORATION SHALL BE ADOPTED BY ITS BOARD OF DIRECTORS. THE POWER TO ALTER, AMEND OR REPEAL THE BY-LAWS OR ADOPT NEW BY-LAWS, SHALL BE VESTED IN THE BOARD OF DIRECTORS. TO COMPLETE A CHANGE IN BY-LAWS THE FOLLOWING PROCESS WILL BE FOLLOWED: 1. CHANGES WILL BE SENT TO THE MEMBERS 30 DAYS IN ADVANCE OF THE BOARD OF DIRECTORS VOTING ON THE CHANGES. THE 30-DAY COMMENT PERIOD IS FOR MEMBERS TO SEND COMMENTS OR ASK QUESTIONS. 2. THE VOTE ON THE AMENDED BY-LAWS WILL BE PART OF THE NEXT AVAILABLE BOARD MEETING. 3. MEMBERS WILL RECEIVE OUTCOME OF THE VOTE AND ANY ADDITIONAL INFORMATION NO LATER THAN 30 DAYS AFTER THE APPROVAL OF AMENDED BY-LAWS." A COMPLETE COPY OF THE BYLAWS CAN BE FOUND ON THE COOPERATIVE'S WEBSITE: HTTPS://WWW.GCE.COOP. |
| 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. |
| 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 B, LINE 11B | MANAGEMENT AND PAID PREPARER REVIEW DRAFTS OF FORM 990 PRIOR TO E-FILING. |
| FORM 990, PART VI, SECTION B, LINE 12C | GCEC HAS A CONFLICT OF INTEREST POLICY THAT IS APPLICABLE TO ALL BOARD MEMBERS. DIRECTORS ARE TO MAKE WRITTEN DISCLOSURES OF ANY SUBSTANTIAL OUTSIDE INTEREST IN ANY ENTITY DOING BUSINESS WITH GCEC, INCLUDING BUT NOT LIMITED TO ANY OWNERSHIP INTEREST OR VOTING PRIVILEGE AS A DIRECTOR OR TRUSTEE, IN ORDER TO PERMIT CONSIDERATION BY THE BOARD OF DIRECTORS OF SUCH CONTINUING RELATIONSHIP. SUCH DISCLOSURE SHALL BE MADE AT THE TIME A DIRECTOR ACQUIRES SUCH AN INTEREST. ADDITIONALLY, ALL DIRECTORS SHALL ANNUALLY MAKE A WRITTEN DISCLOSURE OF ANY TO GCEC. GCEC'S GENERAL COUNSEL SHALL ANNUALLY REVIEW WITH THE BOARD OF DIRECTORS THIS POLICY AND MATTERS RELATING TO THEIR COLLECTIVE AND INDIVIDUAL DUTIES AND OBLIGATIONS AS DIRECTORS. SUCH REVIEW SHALL TAKE PLACE DURING THE QUARTER AFTER GCEC'S ANNUAL MEETING. IMPLEMENTATION OF THE POLICY SHALL BE THE RESPONSIBILITY OF THE BOARD OF DIRECTORS, EXCEPT AS OTHERWISE PROVIDED HEREIN BY THE GENERAL MANAGER OR THE GCEC GENERAL COUNSEL. |
| FORM 990, PART VI, SECTION B, LINE 15A | THE BOARD OF TRUSTEES EVALUATES THE PERFORMANCE OF THE GENERAL MANAGER/EXECUTIVE VP AND THEN VOTES ON THE ANNUAL SALARY. THE DECISION IS PARTIALLY BASED ON A COMPENSATION SURVEY, WHICH INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT ARIZONA AND THE NATION. EXECUTIVE VP/GENERAL MANAGER EVALUATES THE PERFORMANCE OF THE ORGANIZATION'S OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEES, IF ANY. A COMPENSATION SURVEY, WHICH INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT ARIZONA AND THE NATION, IS THEN USED TO HELP SET COMPENSATION. |
| 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. THE ANNUAL REPORT, AUDITED FINANCIAL STATEMENTS AND BYLAWS CAN ALSO BE FOUND 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 OFFICERS AND HIGHLY COMPENSATED EMPLOYEES, MEETING THE ELIGIBILITY REQUIREMENTS OF SUCH PLANS. THE COOPERATIVE ALSO PROVIDES HEALTH, DENTAL, VISION, AND GROUP TERM LIFE INSURANCE TO ALL EMPLOYEES, INCLUDING OFFICERS, THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICERS AND HIGHLY COMPENSATED EMPLOYEES IS COMPRISED OF THE ACTUARIAL INCREASE IN THE DEFINED BENEFIT PLAN, THE TOTAL AMOUNT CONTRIBUTED TO THE 401(K) PENSION PLAN AND EMPLOYER PAID INSURANCE PREMIUMS. |
| 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 TO 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 11A: | THE CORONAVIRUS AID, RELIEF, AND ECONOMIC SECURITY ACT (CARES ACT) ESTABLISHED THE PAYCHECK PROTECTION PROGRAM (PPP) TO PROVIDE LOANS TO SMALL BUSINESSES AS A DIRECT INCENTIVE TO KEEP THEIR WORKERS ON THE PAYROLL. THE LOANS ARE FORGIVEN IF ALL EMPLOYEE RETENTION CRITERIA ARE MET AND THE FUNDS ARE USED FOR ELIGIBLE EXPENSES. DURING 2020, THE COOPERATIVE APPLIED FOR AND RECEIVED A LOAN OF $906,800. AFTER FULFILLING THE REQUIREMENTS OF THE PROGRAM, THE COOPERATIVE APPLIED FOR AND WAS GRANTED LOAN FORGIVENESS. BECAUSE THE NATURE OF THE PROGRAM IS COMPRISED OF A BONA FIDE LOAN FOLLOWED BY LOAN FORGIVENESS, THE AMOUNT FORGIVEN WAS RECORDED AS INCOME. ALTHOUGH THE INSTRUCTIONS TO FORM 990 STATE THAT THE AMOUNT OF PPP LOANS THAT ARE FORGIVEN MAY BE REPORTED ON LINE 1E AS CONTRIBUTIONS FROM A GOVERNMENTAL UNIT, THE COOPERATIVE HAS CHOSEN TO REPORT THE PPP LOAN FORGIVENESS AS OTHER INCOME ON LINE 11A. |
| 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 $ 1,731,054 LESS: TRUSTEE FEES REPORTED ON FORMS 1099-NEC (49,249) LESS: EMPLOYEE OFFICER BENEFITS REPORTED ON LINE 5 (74,673) PLUS: SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 584,426 PLUS: SALARIES AND WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING AND OTHER ACCOUNTS 734,828 TOTAL WAGES ACCRUED AND/OR PAID $ 2,926,386 |
| FORM 990, PART IX, LINE 24: | ADMINISTRATIVE AND GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS, & OTHER $ 440,286 OFFICE SUPPLIES 371,666 OUTSIDE SERVICES EMPLOYED 96,927 PROPERTY INSURANCE 13,545 INJURIES & DAMAGES 71,052 EDUCATION & TRAINING 264,755 DIRECTORS 47,452 REGULATORY COMMISSION EXPENSE 34,654 MISCELLANEOUS GENERAL 157,404 RENTS 14,483 MAINTENANCE OF GENERAL PLANT 129,001 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 1,641,225 LESS: RECLASS OF TRUSTEE FEES TO PART IX, LINE 5 (49,249) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (505,516) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (362,805) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 723,655 |
| 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 2021 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: | ALTHOUGH NO LONGER A BORROWER OF THE RURAL UTILITIES SERVICE (RUS), THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE UNIFORM SYSTEM OF ACCOUNTS (USOA) AS PRESCRIBED FOR RUS BORROWERS. THE USOA 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 ITS 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 XI, LINE 9: | PATRONAGE CAPITAL ASSIGNABLE 2,212,096. PATRONAGE CAPITAL RETIRED - TOTAL -408,633. PATRONAGE CAPITAL RETIRED - DISCOUNT 1,305. NET CHANGE IN MEMBERSHIPS 570. DONATED CAPITAL & OTHER -58,276. OTHER COMPREHENSIVE INCOME 515,093. |
| FORM 990, PART XII, LINE 2C: | AUDITED FINANCIAL STATEMENTS WERE PREPARED BY AN INDEPENDENT ACCOUNTANT FOR THE COOPERATIVE'S FINANCIAL STATEMENT AUDIT YEAR-END OF SEPTEMBER 30TH. THE TAX RETURN HAS BEEN AND CONTINUES TO BE PREPARED BASED ON A CALENDAR TAX YEAR-END OF DECEMBER 31. THE BOARD AS A WHOLE IS RESPONSIBLE FOR OVERSEEING THE FINANCIAL STATEMENT AUDIT AND SELECTING THE INDEPENDENT FINANCIAL STATEMENT AUDITOR. |
For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.
Cat. No. 51056K
Schedule O (Form 990) 2021
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