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
CENTRAL VALLEY ELECTRIC COOPERATIVE INC
Employer identification number
85-0027414
85-0027414
| Return Reference | Explanation |
|---|---|
| FORM 990, PART I, LINE 19: | 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 $12,000, WHICH IS THE INCOME STATEMENT EFFECT OF ACCRUED UNBILLED REVENUE AND FORM 990 REPORTING OF UNREALIZED GAINS AND LOSSES AS A COMPONENT OF OTHER CHANGES IN NET ASSETS IN LIEU OF REPORTING AS AN ITEM OF REVENUE OR INCOME. THE GAAP BASIS FINANCIAL STATEMENTS INCLUDE AN ACCRUAL FOR UNBILLED REVENUE BECAUSE THE COOPERATIVE'S BILLING CYCLE DOES NOT END ON THE LAST DAY OF THE MONTH. THEREFORE, IT HAS REVENUE IN DECEMBER OF EACH YEAR THAT IT HAS EARNED BUT WILL NOT BILL UNTIL THE FIRST BILLING CYCLE OF THE FOLLOWING YEAR. THE COOPERATIVE ESTIMATES THIS REVENUE AND RECORDS IT AS ACCRUED UNBILLED REVENUE IN ORDER TO MATCH THE REVENUE WITH THE YEAR EARNED. HOWEVER, THE COOPERATIVE ALLOCATES THE REVENUE TO MEMBERS IN THE YEAR IT IS BILLED RATHER THAN WHEN IT IS ACCRUED. THIS TIMING DIFFERENCE IS FAIR AND EQUITABLE BECAUSE IT MATCHES THE PATRONAGE DIVIDEND ALLOCATED WITH THE BILLING RECORDS USED TO ALLOCATE THE MARGINS. DUE TO THE TIMING OF WHEN THE COOPERATIVE ALLOCATES ACCRUED UNBILLED REVENUE, PAGE 1, PART I, LINE 19 ANNUALLY REPORTS NET INCOME EQUAL TO THE NET INCREASE IN ACCRUED UNBILLED REVENUE OR A NET LOSS EQUAL TO THE NET DECREASE IN UNBILLED REVENUE. THE FOLLOWING SCHEDULE IS PROVIDED TO FURTHER EXPLAIN THE IMPACT OF THIS TRANSACTION: ADD: UNBILLED REVENUE 12/31/22 $ 633,000 LESS: UNBILLED REVENUE 12/31/21 (621,000) (A) - NET INCOME ON PAGE 1, PART I, LINE 19 $ 12,000 (B) - BENEFITS PAID TO MEMBERS (I.E. PATRONAGE DIVIDENDS), PART I, LINE 14 $ 1,664,532 (C) - UNREALIZED GAIN - PART XI, LINE 5 $(1,278,732) TOTAL 2022 NET MARGIN (A + B + C) $ 397,800 |
| 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 6. PUCHASE OF ELECTRIC ENERGY, WAS AMENDED TO STATE "EACH APPLICANT FOR SERVICE SHALL, AS SOON AS ELECTRIC ENERGY SHALL BE AVAILABLE, PURCHASE FROM THE COOPERATIVE ELECTRIC ENERGY AS SPECIFIED IN HIS APPLICATION FOR SERVICE OR SERVICE AGREEMENT, AND SHALL PAY THEREFOR MONTHLY AT RATES WHICH SHALL FROM TIME TO TIME BE FIXED BY THE BOARD OF TRUSTEES AS SUCH RATE MAY BE MODIFIED OR AMENDED PURSUANT TO APPLICABLE LAW". THE SECTION GOES ON TO STATE THAT "EACH PATRON SHALL PAY TO THE COOPERATIVE SUCH MINIMUM AMOUNT PER MONTH REGARDLESS OF THE AMOUNT OF ELECTRIC ENERGY CONSUMED, AS SHALL BE FIXED BY THE BOARD OF TRUSTEES FROM TIME TO TIME SUBJECT TO APPLICABLE LAW." ARTICLE III - MEETING OF MEMBERS SECTION 1. ANNUAL MEETING, WAS AMENDED TO ADD "THE BOARD OF TRUSTEES HAS THE AUTHORITY TO CANCEL, POSTPONE, CHANGE THE ORDER OF BUSINESS OR MODIFY THE MANNER IN WHICH A MEETING OF THE COOPERATIVE IS CONDUCTED IN CIRCUMSTANCES WHERE IT REASONABLY DETERMINES THAT THE CONDUCT OF THE MEETING WOULD POSE A THREAT TO THE PUBLIC HEATH, SAFETY OR WELFARE." SECTION 7. ORDER OF BUSINESS, WAS AMENDED TO ADD "FOR GOOD CAUSE, THE MANNER AND ORDER OF CONDUCTING BUSINESS MAY BE ALTERED BY THE BOARD OF TRUSTEES." ARTICLE VI - OFFICERS SECTION 9. BONDS OF OFFICERS, WAS AMENDED TO STATE "THE TREASURER AND ANY OTHER OFFICER OR AGENT OF THE COOPERATIVE CHARGED WITH RESPONSIBILITY FOR THE CUSTODY OF ANY OF ITS FUNDS OR PROPERTY MAY GIVE BOND IN SUCH SUM AND WITH SUCH SURETY AS THE BOARD OF TRUSTEES SHALL DETERMINE." ARTICLE XI - MISCELLANEOUS SECTION 4. ACCOUNTING SYSTEM AND REPORTS, WAS AMENDED TO STATE "ALL ACCOUNTS OF THE COOPERATIVE MAY BE EXAMINED BY A COMMITTEE OF THE BOARD OF TRUSTEES WHICH SHALL RENDER REPORTS TO THE BOARD OF TRUSTEES AT LEAST FOUR TIMES A YEAR AT REGULAR MEETINGS OF THE BOARD OF TRUSTEES. THE BOARD OF TRUSTEES SHALL CAUSE TO BE MADE A FULL AND COMPLETE AUDIT OF THE ACCOUNTS, BOOKS, AND FINANCIAL CONDITION OF THE COOPERATIVE. SUCH AUDIT REPORTS MAY BE SUBMITTED TO THE MEMBERS AT THE FOLLOWING ANNUAL MEETING." |
| 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 A, LINE 8B | THE COOPERATIVE HAS NO COMMITTEES WITH AUTHORITY TO ACT ON BEHALF OF THE GOVERNING BODY. THEREFORE, THE QUESTION HAS BEEN ANSWERED "NO". |
| FORM 990, PART VI, SECTION B, LINE 11B | MANAGEMENT PRESENTED A COPY OF THE FORM 990 TO THE BOARD FOR DISCUSSION AND REVIEW PRIOR TO FILING. |
| FORM 990, PART VI, SECTION B, LINE 12C | TRUSTEES MUST DISCLOSE TO THE BOARD PRESIDENT AND EMPLOYEES MUST DISCLOSE TO THE GENERAL MANAGER ANY SITUATION, WHICH, IN HIS OR HER OPINION, VIOLATES, MAY VIOLATE, OR COULD APPEAR TO VIOLATE THE INTENT OF THIS POLICY. |
| FORM 990, PART VI, SECTION B, LINE 15 | THE BOARD OF TRUSTEES USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE COOPERATIVE'S GENERAL MANAGER. THE SURVEY INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT NEW MEXICO AND THE NATION. THE GENERAL MANAGER USES A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE ORGANIZATION'S OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEES, IF ANY. THE SURVEY INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT NEW MEXICO AND THE NATION. |
| FORM 990, PART VI, SECTION C, LINE 19 | THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF ITS GOVERNING DOCUMENTS AND AUDITED FINANCIAL STATEMENTS TO ANY MEMBER WHO REQUESTS A COPY OF ANY SUCH DOCUMENT. ANNUALLY, THE COOPERATIVE MAILS A COPY OF THE AUDITED BALANCE SHEET AND INCOME STATEMENT TO THE MEMBERS OF THE COOPERATIVE WITH THE ANNUAL REPORT. |
| 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 LIFE INSURANCE TO ALL ELIGIBLE EMPLOYEES 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 BY THE COOPERATIVE TO THE DEFINED CONTRIBUTION PLAN AND THE INSURANCE PAID ON BEHALF OF AND FOR THEIR BENEFIT. IN ADDITION TO THE ABOVE PENSION PLANS, THE COOPERATIVE ALSO PROVIDES POST-RETIREMENT HEALTH INSURANCE BENEFITS TO RETIREES PRIOR TO JANUARY 1, 1995 THROUGH AN UNFUNDED WELFARE BENEFIT PLAN. THE VALUE OF THESE BENEFITS HAS NOT BEEN ESTIMATED. |
| FORM 990, PART VIII, LINE 2C: | 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 VIII, LINE 2B: | THE COOPERATIVE AND WESTERN FARMERS ELECTRIC COOPERATIVE (WFEC), A RURAL ELECTRIC GENERATION AND TRANSMISSION COOPERATIVE, HAVE ENTERED INTO A WHOLESALE POWER CONTRACT WHERE WFEC WILL PROVIDE THE COOPERATIVE WITH ELECTRIC POWER. AS PART OF THE AGREEMENT THE COOPERATIVE MUST CONTRIBUTE EQUITY TO WFEC IN A MANNER AND AMOUNT SUCH THAT, AS OF JUNE 1, 2026, THE COOPERATIVE HAS CONTRIBUTED EQUITY TO WFEC COMPARABLE TO THE AMOUNT OF EQUITY CONTRIBUTED TO WFEC BY PRIOR EXISTING MEMBERS. THE PURPOSE OF THE CONTRIBUTION IS TO OBTAIN A POWER SUPPLY IN ORDER TO MEET THE TERMS OF THE WHOLESALE PURCHASE CONTRACT. PURSUANT TO APPROVAL BY THE NEW MEXICO PUBLIC REGULATION COMMISSION, THE EQUITY CONTRIBUTION IS RECOVERED MONTHLY FROM THE MEMBERS THROUGH THE SALE OF ELECTRICITY. |
| FORM 990, PART IX: | THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE UNIFORM SYSTEM OF ACCOUNTS (USOA) AS PRESCRIBED FOR ELECTRIC BORROWERS OF THE RURAL UTILITIES SERVICES (RUS). 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 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 USOA. |
| 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 $ 5,411,152 LESS: TRUSTEE FEES REPORTED ON FORMS 1099-NEC (208,005) LESS: EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (349,297) PLUS: SALARIES AND WAGES CAPITALIZED DIRECTLY TO PLANT 2,468,853 PLUS: SALARIES AND WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING AND OTHER ACCOUNTS 430,833 TOTAL WAGES ACCRUED AND/OR PAID $ 7,753,536 |
| FORM 990, PART IX, LINE 24: | AMINISTRATIVE & GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL SALARIES, BENEFITS, & OTHER $ 1,628,092 OFFICE SUPPLIES 222,544 OUTSIDE SERVICES 90,200 INJURIES AND DAMAGES 110,832 REGULATORY COMMISSION 340,527 MISCELLANEOUS GENERAL 225,014 TRUSTEES 260,950 DUES AND SUBSCRIPTIONS 133,758 MAINTENANCE OF GENERAL PLANT 57,619 MAINTENANCE OF SCADA 71,648 DUPLICATE CHARGES (54,223) ADVERTISING 58,892 ANNUAL MEETING 31,359 CAPITAL CREDITS 6,885 RENTS 39,885 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 3,223,982 LESS: RECLASS OF TRUSTEES FEES TO PART IX, LINE 5 (208,005) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (1,015,868) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (493,973) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 1,506,136 |
| 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 CALENDAR TAX 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 2022 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/OR DONATIONS ARE MADE TO NON-PROFIT AND CIVIC ORGANIZATIONS THAT ARE LOCATED IN THE COOPERATIVE'S SERVICE AREA, AND ARE INTENDED TO IMPROVE THE COMMUNITIES IN WHICH OUR MEMBERS RESIDE. EACH GRANT, SPONSORSHIP, AND/OR DONATION MADE DURING THE YEAR WAS BELOW THE REPORTING THRESHOLD OF SCHEDULE I, PART II. |
| FORM 990, PART XI, LINE 9: | PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 1,664,532. PATRONAGE CAPITAL RETIRED - TOTAL -2,786,821. UNRECOGNIZED POST RETIREMENT BENEFIT COSTS -16,974. |
| FORM 990, PART XII, LINE 2B: | AUDITED FINANCIAL STATEMENTS WERE PREPARED BY AN INDEPENDENT ACCOUNTANT FOR THE COOPERATIVE'S FINANCIAL STATEMENT AUDIT YEAR-END OF JUNE 30. THE TAX RETURN HAS BEEN AND CONTINUES TO BE PREPARED BASED ON A CALENDAR TAX YEAR-END OF DECEMBER 31. THE BOARD HAS AN APPOINTED AUDIT COMMITTEE WHICH 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) 2021
Additional Data
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