2023-10-30T09:25:28-05:00 2022-12-31 410746749 CLIFTONLARSONALLEN LLP 2689 COMMERCE DRIVE NW SUITE 201 ROCHESTER MN 55901 990 2022-01-01 410558175 STEARNS COOPERATIVE ELECTRIC ASSOCIATION STEA 8009620655 900 KRAFT DR SE PO BOX 40 MELROSE MN 56352 MATTHEW O'SHEA CEO 8009620655 2023-09-29 1 MATTHEW OSHEA 999009999 0 KATHERINE LUTZKE CPA P01760889 5072802300 2023-09-29 2 AAL1 IAL1 2022 2023-04-26 12:10:37Z STEARNS ELECTRIC ASSOCIATION MATTHEW O'SHEA 900 KRAFT DR SE PO BOX 40 MELROSE MN 56352 64606320 0 X WWW.STEARNSELECTRIC.ORG X 1937 MN GENERATION AND PURCHASE OF ELECTRICITY FOR DISTRIBUTION ON A COOPERATIVE BASIS TO MEMBERS. 9 9 82 0 19273 3773 0 0 61943099 62743968 351430 364078 3087418 1243906 65381947 64351952 0 0 5398280 4043870 984669 977771 0 0 0 58998998 59330311 65381947 64351952 0 0 153957017 157900352 80385184 82181273 73571833 75719079 GENERATION AND PURCHASE OF ELECTRICITY FOR DISTRIBUTION AND SALE ON A COOPERATIVE BASIS TO MEMBERS. 0 0 SOLD 550,607,119 KWH'S TO OUR COOPERATIVE MEMBERS IN 2022. THE AVERAGE NUMBER OF TOTAL SERVICES WAS 28,073. WE OPERATE ON A COOPERATIVE BASIS TO GENERATE, PURCHASE, DISTRIBUTE, AND SELL ELECTRICITY TO OUR MEMBERS. NET PATRONAGE MARGINS, OUR NET INCOME, IS USED TO GROW OUR PLANT AND RETIRE CAPITAL CREDITS. NET MARGINS ARE ALLOCATED TO MEMBERS AND RETURNED TO OUR MEMBERS OVER TIME. 0 0 0 0 0 0 0 0 0 1 1 0 0 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 1 0 1 1 0 1 58 0 82 1 1 1 0 0 0 0 63049867 720999 0 0 0 X 9 9 0 0 0 0 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 0 X CINDY ANDERSON 8009620655 900 KRAFT DR SE MELROSE MN 56352 ERIC PETERSON PRESIDENT 7.00 0.00 X X 14250 0 0 RANDALL ROTHSTEIN VICE PRESIDENT 5.00 0.00 X X 12850 0 0 STEVEN NOTCH SECRETARY/TREASURER - PART YEAR 4.00 0.00 X X 4600 0 0 MICHAEL CRAMER DIRECTOR/SECRETARY/TREASURER 6.00 0.00 X X 13650 0 0 JEFF KOEHLER DIRECTOR 4.00 0.00 X 8650 0 0 ARLYN LAWRENZ DIRECTOR 5.00 0.00 X 12850 0 0 GREG BLAINE DIRECTOR 13.00 0.00 X 12850 0 0 JEROME FRIES DIRECTOR 9.00 0.00 X 12850 0 0 LAWRENCE IVERSON DIRECTOR 5.00 0.00 X 12950 0 0 ROBERT NIEHAUS DIRECTOR 5.00 0.00 X 8650 0 0 ROBIN C DOEGE CEO - PART YEAR 45.00 0.00 X 226622 0 88065 MATTHEW R O'SHEA CEO 46.00 0.00 X 197399 0 83052 VICTORIA HERKENHOFF VP OF ADMINISTRATION & FIN 46.00 0.00 X 184264 0 84219 GLENN BLOMMEL MANAGER OF OPERATIONS 51.00 0.00 X 166846 0 79615 JAMES PACHAN MANAGER OF ENGINEERING 45.00 0.00 X 138851 0 72304 RYAN A ZIERDEN MANAGER OF IT 48.00 0.00 X 147691 0 59465 CINDY ANDERSON MANGER OF FINANCE 45.00 0.00 X 132216 0 70217 JACOB DOONER LINE SUPERINTENDENT 52.00 0.00 X 124368 0 43698 1432407 0 580635 32 0 1 0 CARR'S TREE SERVICE PO BOX 250 OTTERTAIL MN 56571 TREE CLEARING 1418700 INTEGRITY CONTRACTING INC 17827 COUNTY ROAD 2 SHEVLIN MN 56676 UNDERGROUND POWER LINE UTILITY CONTRACTO 714794 NISC PO BOX 1147 MANDAN ND 58554 SOFTWARE SERVICE/SUPPORT 459351 LEGACY POWER LINE INC 12822 HWY 10 PO BOX 469 WADENA MN 56482 OVERHEAD POWER LINE UTILITY CONTRACTOR 308067 HIGHLINE CONSTRUCTION INC 16124 OLD LAKE RD PAYNESVILLE MN 56362 OVERHEAD POWER LINE UTILITY CONTRACTOR 239203 8 SALE OF ELECTRICITY 221000 62743968 62743968 62743968 231432 231432 21667 0 21667 21667 21667 160842 28196 132646 132646 132646 246322 226172 20150 20150 CAPITAL CREDITS 523000 991069 991069 SUBSIDIARY INCOME 523000 170637 151364 19273 MISCELLANEOUS FEES 523000 40383 40383 1202089 64351952 63946934 19273 385745 4043870 977771 2023019 4829693 COST OF POWER 40533066 OPERATIONS 3743662 MAINTENANCE 3576057 GENERAL & ADMIN 2467257 2157557 64351952 900094 1199557 6946676 8079157 6284872 5776005 2505129 3601551 386166 406912 152339700 48473839 100527429 103865861 35414106 34143702 992545 827607 153957017 157900352 8841956 8719251 67290880 70628256 4252348 2833766 80385184 82181273 X 0 0 0 0 73571833 75719079 73571833 75719079 153957017 157900352 X 0 2147246 X X 0 1 X 1 0 969166 969166 6284534 2435967 3848567 145086000 46037872 99048128 103865861 PATRONAGE CAPITAL 29278122 C INVEST IN CFC-LOAN CTCS 1093751 C INVEST IN ASSOCIATED ORG 13625 C INVEST IN ECON DEV PROJECTS 1261388 C OTHER INVESTMENTS 2496816 C 34143702 DEFERRED CREDITS 2417287 ACCUMULATED PROVISION FOR PENSIONS 416479 2833766 X PART X, LINE 2: THE COOPERATIVE IS EXEMPT FROM INCOME TAXES UNDER SECTION 501(C)(12) OF THE INTERNAL REVENUE CODE (IRC). THE COOPERATIVE'S WHOLLY OWNED SUBSIDIARY, SEA DEVELOPMENT, LLC, IS TREATED AS A DISREGARDED ENTITY FOR INCOME TAX PURPOSES. GAINS AND LOSSES FROM THE LLC ARE INCLUDED WITH THE COOPERATIVE'S UNRELATED BUSINESS INCOME FOR TAX REPORTING PURPOSES. THE COOPERATIVE UTILIZES AN ASSET AND LIABILITY APPROACH TO FINANCIAL ACCOUNTING AND REPORTING FOR INCOME TAXES. DEFERRED INCOME TAXES ARE COMPUTED ANNUALLY FOR DIFFERENCES BETWEEN THE FINANCIAL STATEMENT AND TAX BASIS OF ASSETS AND LIABILITIES THAT WILL RESULT IN TAXABLE OR DEDUCTIBLE AMOUNTS IN THE FUTURE BASED ON ENACTED TAX LAWS AND RATES APPLICABLE TO THE PERIODS IN WHICH THE DIFFERENCES ARE EXPECTED TO AFFECT TAXABLE INCOME. AS OF DECEMBER 31, 2022 AND 2021, THE COOPERATIVE HAS A DEFERRED INCOME TAX ASSET OF $5,163 AND $8,096, RESPECTIVELY, SEE NOTE 16 IN THE AUDITED FINANCIAL STATEMENTS. VALUATION ALLOWANCES ARE ESTABLISHED WHEN NECESSARY TO REDUCE DEFERRED TAX ASSETS TO THE AMOUNT EXPECTED TO BE REALIZED. THE BENEFIT FOR INCOME TAXES IS THE TAX PAYABLE OR REFUNDABLE FOR THE PERIOD PLUS OR MINUS THE CHANGE DURING THE PERIOD IN DEFERRED TAX ASSETS AND LIABILITIES. THE COOPERATIVE EVALUATED ITS TAX POSITIONS AND DETERMINED THAT IT HAS NO UNCERTAIN TAX POSITIONS AS OF DECEMBER 31, 2022 AND 2021. X X 0 0 0 ROBIN C DOEGE CEO - PART YEAR 198587 0 7500 0 20535 0 63556 0 24509 0 314687 0 0 0 MATTHEW R O'SHEA CEO 168694 0 6750 0 21955 0 55204 0 27848 0 280451 0 0 0 VICTORIA HERKENHOFF VP OF ADMINISTRATION & FIN 160688 0 6750 0 16826 0 53611 0 30608 0 268483 0 0 0 GLENN BLOMMEL MANAGER OF OPERATIONS 148362 0 6000 0 12484 0 50475 0 29140 0 246461 0 0 0 JAMES PACHAN MANAGER OF ENGINEERING 131971 0 6000 0 880 0 43888 0 28416 0 211155 0 0 0 RYAN A ZIERDEN MANAGER OF IT 141148 0 6000 0 543 0 45265 0 14200 0 207156 0 0 0 CINDY ANDERSON MANGER OF FINANCE 125427 0 6000 0 789 0 41814 0 28403 0 202433 0 0 0 JACOB DOONER LINE SUPERINTENDENT 115706 0 1500 0 7162 0 14600 0 29098 0 168066 0 0 0 FORM 990, PART VI, SECTION A, LINE 6 PERSONS AND ENTITIES, INCLUDING JOINT MEMBERS, RECEIVING ELECTRIC SERVICE FROM THE COOPERATIVE, AND HAVING VOTING RIGHTS AS REFLECTED ON THE RECORDS OF THE COOPERATIVE. FORM 990, PART VI, SECTION A, LINE 7A MEMBERS ELECT THE BOARD OF DIRECTORS (GOVERNING BODY) BY BALLOT THROUGH ELECTION PROCESS (9 VOTING DISTRICTS). FORM 990, PART VI, SECTION A, LINE 7B REMOVAL OF DIRECTORS FOR CAUSE & REINSTATE AN EXPELLED MEMBER. DISPOSAL OF MORE THAN 25% OF THE COOPERATIVE PROPERTY. MERGE OR CONSOLIDATE WITH ANOTHER ENTITY AND FILE BANKRUPTCY. A BYLAW CHANGE MUST BE APPROVED BY THE MEMBERS. FORM 990, PART VI, SECTION A, LINE 8B THE ORGANIZATION DOES NOT HAVE ANY COMMITTEES THAT HAVE AUTHORITY TO ACT ON BEHALF OF THE GOVERNING BODY. FORM 990, PART VI, SECTION B, LINE 11B THE CEO AND THE MANAGER OF FINANCE PROVIDE AND REVIEW FORM 990 WITH DIRECTORS BEFORE FILING. FORM 990, PART VI, SECTION B, LINE 12C STEARNS ELECTRIC ASSOCIATION'S "CONFLICT OF INTEREST" POLICY APPLIES TO DIRECTORS, OFFICERS, AND SENIOR MANAGEMENT OF THE COOPERATIVE. ANNUALLY, DIRECTORS, OFFICERS AND SENIOR MANAGEMENT SIGN A GIFT STATEMENT ACKNOWLEDGING THEY UNDERSTAND THE COOPERATIVE'S GIFT POLICY AND THAT THEY HAVE NOT RECEIVED GIFTS OF SUCH NATURE. EACH YEAR, THEY ALSO SIGN A "CONFLICT OF INTEREST CERTIFICATION AND DISCLOSURE STATEMENT AND DISCLOSE ANY POSSIBLE CONFLICTS OF INTEREST AS DEFINED IN THE CONFLICT OF INTEREST POLICY. THE BOARD OF DIRECTORS REVIEWS SIGNED AND COMPLETED "GIFT STATEMENTS AND "CONFLICT OF INTEREST CERTIFICATIONS" EACH YEAR AND TAKES ACTION AS DEEMED NECESSARY BASED UPON THE POLICY. IF THERE WAS A POTENTIAL / ACTUAL CONFLICT OF INTEREST, THE PROCEEDINGS WOULD BE DOCUMENTED IN THE BOARD MINUTES. ANY NUMBER OF RESTRICTIONS MAY BE IMPOSED ON PERSONS WITH A CONFLICT OF INTEREST SUCH AS REQUIRING DIVESTITURE OF PROPERTY, OR INABILITY TO PARTICIPATE IN, DISCUSS, OR VOTE UPON DECISIONS OR ACTIONS TO WHICH THE CONFLICT IS OR MAY BE RELEVANT. VIOLATION OF THE POLICY MAY RESULT IN DISCIPLINARY ACTIONS, INCLUDING BUT NOT LIMITED TO: TERMINATION OF DIRECTORSHIP OR EMPLOYMENT. FINALLY, ALL EMPLOYEES ARE ALSO EXPECTED TO DISCLOSE POSSIBLE CONFLICTS OF INTEREST AS OUTLINED IN THE EMPLOYEE HANDBOOK. FORM 990, PART VI, SECTION B, LINE 15 A NATIONAL SURVEY IS USED FOR COMPARABILITY DATA. THE BOARD TAKES ACTION INDEPENDENTLY TO ESTABLISH COMPENSATION FOR THE CEO. SALARY ADJUSTMENT FORM IS SIGNED BY BOARD PRESIDENT. THE CEO DETERMINES COMPENSATION FOR KEY EMPLOYEES. A NATIONAL SURVEY IS USED FOR COMPARABILITY DATA. A SALARY FORM IS SIGNED BY EMPLOYEE SUPERVISOR. THIS PROCESS WAS MOST RECENTLY COMPLETED IN 2022. FORM 990, PART VI, SECTION C, LINE 19 GOVERNING DOCUMENTS & CONFLICT OF INTEREST POLICY ARE AVAILABLE ON REQUEST FROM THE PERSON LISTED IN PART VI-C, LINE 20. FINANCIAL STATEMENTS ARE AVAILABLE PER THE PUBLIC INSPECTION RULES. FORM 990, PART XI, LINE 9: CAPITAL CREDITS RETIRED -2,045,083. PATRONAGE MARGINS ALLOCATED 4,043,870. ESTATE DISCOUNTS RETAINED 148,458. ROUNDING 1. PART XII, LINE 2C: THE PROCESS FOR OVERSIGHT OF THE ANNUAL FINANCIAL STATEMENT AUDIT AND SELECTION OF AN INDEPENDENT ACCOUNTANT HAS NOT CHANGED. FORM 990, PART IX, LINE 4: THE IRS INSTRUCTIONS STATE THAT PATRONAGE MARGINS ALLOCATED BY SECTION 501(C)(12) ORGANIZATIONS TO THEIR MEMBERS SHOULD BE REPORTED ON LINE 4. THE ORGANIZATION HAS INTERPRETED PATRONAGE DIVIDENDS PAID TO MEAN PATRONAGE DIVIDENDS ALLOCATED OR TO BE ALLOCATED FOR THE CURRENT YEAR. SINCE THIS ALLOCATION IS NOT AN EXPENSE UNDER GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP), THIS HAS RESULTED IN A RECONCILING ITEM TO NET ASSETS IN PART XI, ON PAGE 12 OF THE FORM 990. SEA DEVELOPMENT LLC 900 KRAFT DR SE MELROSE MN 56352 383733826 LAND/ECONOMIC DEVEOPMENT MN -943 0 STEARNS COOPERATIVE ELECTRIC ASSOCIATION 1