2019-11-12T16:31:06-06:00 2018-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2018-01-01 730177775 CENTRAL RURAL ELECTRIC COOPERATIVE INC CENT 8003752884 PO BOX 1809 STILLWATER OK 74076 BILL DAVIS PRESIDENT 8003752884 2019-11-11 1 WILLIAM M MILLER P00439459 8067473806 2019-11-08 X 65.182.80.152 2019-11-11 11:25:41 CS P 587A88673713A033F58E04FDF6801CBB1F7DD2F2 587A88673713A033F58E04FDF6801CBB1F7DD2F2 2018 2020-03-31 21:24:44Z HUNTER ROBINSON PO BOX 1809 STILLWATER OK 74076 65881025 0 X WWW.MYCENTRAL.COOP X 1938 OK TO PROVIDE QUALITY AND RELIABLE ELECTRIC SERVICE TO MEMBERS AT COST ON A COOPERATIVE BASIS. 8 8 98 0 3240 1740 0 0 57744189 65273138 1056514 500725 -132648 86175 58668055 65860038 0 9195 3571006 5213230 7084101 8161318 0 0 0 50243785 52476295 60898892 65860038 -2230837 0 164071808 156959183 99652995 80052878 64418813 76906305 EMPOWERING OUR MEMBERS AND COMMUNITIES. 0 0 SALE OF ELECTRIC POWER TO MEMBERS - 21,938 ACTIVE SERVICES WERE PROVIDED POWER AT YEAR END AT COST ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. 0 0 0 0 0 0 0 0 0 1 0 1 0 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 1 1 1 0 0 1 61 0 98 1 1 1 0 0 0 0 63707026 1277124 0 0 0 X 8 8 0 0 0 0 1 1 1 1 0 0 0 1 1 1 1 1 1 1 1 0 OK X CENTRAL RURAL ELECTRIC ACCOUNTING DEPT 4053722884 3305 S BOOMER ROAD STILLWATER OK 74076 X BILL DAVIS PRESIDENT 11.30 X X 27000 0 0 RAY NETTLES VICE PRESIDENT 10.80 X X 30000 0 0 CAROL DVORAK SECRETARY/TREASURER 10.40 X X 28000 0 0 CLYDE HABBEN TRUSTEE 5.50 X 22500 0 0 GARY MCCUNE TRUSTEE 12.20 X 30000 0 0 MARK PITTMAN TRUSTEE 14.40 X 37000 0 0 STU PRESTON TRUSTEE 15.40 X 32750 0 0 LEN TONTZ TRUSTEE 7.30 X 26000 0 0 DAVID SWANK CEO (JAN-DEC) 40.00 X 296979 0 136085 HUNTER ROBINSON INTERIM CEO 60.00 X 103054 0 87880 CRAIG MCBRAIN CFO 45.00 X 110464 0 38038 MICHELLE PERZEE COO 40.00 X 107079 0 40128 YUVARAJ KONDASWAMY SYSTEM ENGINEER 40.00 X 113280 0 46089 TODD HIEMER EXEC VP OF ENGINEERING 40.00 X 111033 0 45767 JEFF RHEIN CHIEF TECHNOLOGY OFFICER 40.00 X 108012 0 68592 JAMES CLAY TECHNOLOGY INTEGRATION TECH 40.00 X 106797 0 33635 DALE VEIT DIRECTOR OF TECHNOLOGY 40.00 X 105649 0 42970 1395597 0 539184 11 0 1 0 RIGGS TREE SERVICE INC PO BOX 453225 GROVE OK 74345 TREE CLEARING 1666311 ARKANSAS ELECTRIC COOPERATIVES INC PO BOX 194208 LITTLE ROCK AR 72219 CONSTRUCTION CONTRACTOR 1288582 PCI UTILITIES LLC PO BOX 2967 MCKINNEY TX 75070 CONSTRUCTION CONTRACTOR 497843 OSMOSE UTILITIES SERVICES INC PO BOX 8000560 BUFFALO NY 14267 POLE INSPECTION & RESTORATION 419195 INTERWORKS INC 1425 S SANGRE RD STILLWATER OK 74074 INFORMATION TECHNOLOGY 276912 8 X SALES OF ELECTRICITY 221000 61667580 61667580 PATRONAGE DIVIDENDS 221000 2366006 2366006 SERVICE FEES & OTHER CHARGES 221000 1147533 1147533 OTHER PROGRAM REVENUE 221000 92019 92019 65273138 440912 440912 3240 0 3240 3240 3240 80800 20987 59813 59813 59813 MISC NON-OPERATING REVENUE 221000 82935 82935 82935 65860038 65356073 3240 500725 X 9195 5213230 1152957 4483291 963414 1179965 381691 1612916 5560294 PURCHASED POWER 37873334 SUBSIDIARY EXPENSE 2947205 DISTRIBUTION EXPENSE 2528848 ADMIN & GENERAL EXPENSE 1182707 770991 65860038 14828422 2078194 11806650 6866591 3175574 910 33072 1848500 2913271 162833124 61799437 111298938 101033687 29228447 31048597 0 4870138 164071808 156959183 4959799 4889816 55796549 58340095 38896647 16822967 99652995 80052878 X 768190 785920 0 0 63650623 76120385 64418813 76906305 164071808 156959183 X 0 5177343 7310149 X X 0 1 X 1 0 1179946 1179946 20473425 4762392 15711033 135109677 57030568 78079109 6070076 6477 6063599 101033687 CAPITAL TERM CERTIFICATES - CFC 971735 C PATRONAGE CAPITAL - CFC 222742 C PATRONAGE CAPITAL - KAMO POWER 27326317 C PATRONAGE CAPITAL - NISC 137020 C PATRONAGE CAPITAL - COBANK 360625 C PATRONAGE CAPITAL - AECI 1576456 C PATRONAGE CAPITAL - OTHER 352986 C NOTES RECEIVABLE-CIA INSTALL 47750 C INVESTMENTS IN OTHERS 52966 C 31048597 CONSUMER DEPOSITS 595509 CUSTOMER ADVANCES FOR CONSTRUCTION 961640 OIL LOAD REVENUE DEFERRAL PLAN 11666265 DEFERRED CREDITS 817454 PROVISION FOR POST-RETIREMENT BENEFIT 2782099 16822967 X 62902200 0 62902200 2957838 2957838 65860038 57688970 0 57688970 8171068 8171068 65860038 PART X, LINE 2: THE COOPERATIVE AND SUBSIDIARIES FOLLOWS THE "UNCERTAIN TAX POSITIONS" PROVISIONS OF ACCOUNTING PRINCIPLES GENERALLY ACCEPTED IN THE UNITED STATES OF AMERICA. THE PRIMARY TAX POSITION OF THE COOPERATIVE IS ITS FILING STATUS AS A TAX EXEMPT ENTITY. THE COOPERATIVE AND SUBSIDIARIES DETERMINED THAT IT IS MORE LIKELY THAN NOT THAT ITS TAX POSITIONS WILL BE SUSTAINED UPON EXAMINATION BY THE INTERNAL REVENUE SERVICE (IRS), OR OTHER STATE TAXING AUTHORITY AND THAT ALL TAX BENEFITS ARE LIKELY TO BE REALIZED UPON SETTLEMENT WITH TAXING AUTHORITIES. PART XI, LINE 4B - OTHER ADJUSTMENTS: EXPENSES RECORDED IN NON-OPERATING MARGINS RECLASSED TO EXPENSES 2,957,838. PART XII, LINE 4B - OTHER ADJUSTMENTS: EXPENSES RECORDED IN NON-OPERATING MARGINS RECLASSED TO EXPENSES 2,957,838. PATRONAGE CAPITAL ALLOCATED OR TO BE ALLOCATED 5,213,230. PART IX: THE AMOUNT OF OTHER ASSETS ON FORM 990, PAGE 11, PART X, LINE 15 DOES NOT EQUAL OR EXCEED 5% OF THE TOTAL ASSETS ON FORM 990, PAGE 11, PART X, LINE 16, COLUMN B. CONSEQUENTLY, IN ACCORDANCE WITH IRS INSTRUCTIONS, SCHEDULE D, PART IX HAS BEEN LEFT BLANK. PART XII, LINE 4B: FOR THE AUDITED FINANCIAL STATEMENTS, THE AMOUNT OF PATRONAGE DIVIDENDS PAID OR ALLOCATED TO THE MEMBERS IS REPORTED AS AN INCREASE IN EQUITY AND NOT AS AN EXPENSE. THEREFORE, NET INCOME PER THE AUDITED FINANCIAL STATEMENTS IS REPORTED GROSS OF THE AMOUNT OF PATRONAGE DIVIDENDS THAT ARE EITHER ALLOCATED OR TO BE ALLOCATED AT THE TIME THE AUDITED FINANCIAL STATEMENTS ARE PREPARED. HOWEVER, BECAUSE THE ALLOCATION OF PATRONAGE DIVIDENDS IS ONE ASPECT OF HOW THE COOPERATIVE FULFILLS ITS TAX EXEMPT PURPOSE OF OPERATING ON A COOPERATIVE BASIS, THE AMOUNT OF PATRONAGE DIVIDENDS EITHER ALLOCATED OR TO BE ALLOCATED TO THE MEMBERS IS REPORTED ON FORM 990, PART IX, LINE 4 AS "BENEFITS PAID TO MEMBERS". PATRONAGE DIVIDENDS ARE ALLOCATED ON A PATRONAGE BASIS AND DONE SO PURSUANT TO A PRE-EXISTING OBLIGATION AS PROVIDED FOR IN THE "NON-PROFIT OPERATION" ARTICLE OF THE COOPERATIVE'S BYLAWS. X 0 0 0 DAVID SWANK CEO (JAN-DEC) 272244 0 21000 0 3735 0 109478 0 26607 0 433064 0 0 0 HUNTER ROBINSON INTERIM CEO 101761 0 1000 0 293 0 64093 0 23787 0 190934 0 0 0 YUVARAJ KONDASWAMY SYSTEM ENGINEER 112021 0 1000 0 259 0 19766 0 26323 0 159369 0 0 0 TODD HIEMER EXEC VP OF ENGINEERING 107052 0 0 0 3981 0 24925 0 20842 0 156800 0 0 0 JEFF RHEIN CHIEF TECHNOLOGY OFFICER 107578 0 0 0 434 0 52356 0 16236 0 176604 0 0 0 PART II, COLUMN C: INCLUDED IN THIS AMOUNT IS THE INCREASE IN ACTUARIAL VALUE OF BENEFITS PAYABLE UNDER A DEFINED BENEFIT RETIREMENT PLAN. THE CONTRIBUTION RATE FOR PARTICIPANTS IN THE NRECA R&S DEFINED BENEFIT PENSION PLAN ARE THE SAME FOR ALL INDIVIDUALS IN THIS MULTI-EMPLOYER PLAN. THE CHANGE IN ACTUARIAL VALUE FOR EACH PARTICIPANT, HOWEVER, VARIES WITH AGE. IN OTHER WORDS, THE OLDER A PLAN PARTICIPANT IS, THE GREATER THE INCREASE IN THAT INDIVIDUAL'S CHANGE IN ACTUARIAL VALUE, ALL OTHER THINGS BEING EQUAL. BECAUSE THIS RELATES TO A MULTI-EMPLOYER PLAN, CASH CONTRIBUTIONS TO THE PLAN IN LIEU OF THE ACTUARIAL INCREASE ARE EXPENSED IN THE FINANCIAL STATEMENTS. DAVID SWANK: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 101,182 EMPLOYER CONTRIBUTION TO 401(K) PLAN 8,296 TOTAL REPORTED IN COLUMN C $ 109,478 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (101,182) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 79,695 EXPENSE TO THE COOPERATIVE $ 87,991 HUNTER ROBINSON: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 60,942 EMPLOYER CONTRIBUTION TO 401(K) PLAN 3,151 TOTAL REPORTED IN COLUMN C $ 64,093 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (60,942) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 30,541 EXPENSE TO THE COOPERATIVE $ 33,692 YUVARAJ KONDASWAMY: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 16,234 EMPLOYER CONTRIBUTION TO 401(K) PLAN 3,532 TOTAL REPORTED IN COLUMN C $ 19,766 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (16,234) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 32,620 EXPENSE TO THE COOPERATIVE $ 36,152 TODD HIEMER: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 21,479 EMPLOYER CONTRIBUTION TO 401(K) PLAN 3,446 TOTAL REPORTED IN COLUMN C $ 24,925 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (21,479) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 39,380 EXPENSE TO THE COOPERATIVE $ 42,826 JEFF RHEIN: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN $ 49,334 EMPLOYER CONTRIBUTION TO 401(K) PLAN 3,022 TOTAL REPORTED IN COLUMN C $ 52,356 LESS: ACTUARIAL INCREASE IN DEFINED BENEFIT PLAN (49,334) ADD: CASH CONTRIBUTION TO DEFINED BENEFIT PLAN 40,781 EXPENSE TO THE COOPERATIVE $ 43,803 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 BY DISTRICT. 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, AND PURSUANT TO FORM 990 INSTRUCTIONS, THE QUESTION HAS BEEN ANSWERED "NO". FORM 990, PART VI, SECTION B, LINE 11B MANAGEMENT PROVIDED A COPY OF THE FORM 990 TO THE BOARD FOR DISCUSSION AND REVIEW PRIOR TO FILING. FORM 990, PART VI, SECTION B, LINE 12C THE BOARD OF TRUSTEES AND OFFICERS ARE REQUIRED TO REVIEW AND BE FAMILIAR WITH THE POLICIES OUTLINED IN THE COOPERATIVE'S CONFLICT OF INTEREST POLICY, AND ARE REQUIRED TO DISCLOSE ANY ACTION OR SITUATION THAT MIGHT VIOLATE THE POLICY TO THE FULL BOARD AS SOON AS POSSIBLE. THE CONFLICT OF INTEREST POLICY IS PERIODICALLY REVIEWED WITH EMPLOYEES AND TRUSTEES. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF TRUSTEES UTILIZE INTERNAL AND/OR EXTERNAL RESOURCES WHEN DETERMINING THE COMPENSATION OF THE CEO. THE BOARD AND THE CEO UTILIZE INTERNAL AND/OR EXTERNAL RESOURCES WHEN DETERMINING THE COMPENSATION OF THE COOPERATIVE'S OTHER EMPLOYEES MEETING THE DEFINITION OF OFFICER AND KEY EMPLOYEES, IF ANY. FORM 990, PART VI, SECTION C, LINE 19 THE COOPERATIVE PROVIDES A SUMMARIZED COPY OF THE AUDITED FINANCIAL STATEMENTS TO THE MEMBERS OF THE COOPERATIVE AT THE ANNUAL MEETING. THE COOPERATIVE'S BYLAWS AND ANNUAL REPORT ARE AVAILABLE ON ITS WEBSITE AS WELL AS A SUMMARY OF THE CURRENT YEAR REGULAR BOARD MEETINGS AT WWW.MYCENTRAL.COOP. FORM 990, PARTS VI & VII THE COOPERATIVE ANNUALLY PROVIDES EACH TRUSTEE WHO SERVED ON THE BOARD DURING THE YEAR A QUESTIONNAIRE AND TIME LOG. THE COMPLETED QUESTIONNAIRES AND TIME LOGS ARE USED TO COMPLETE THE APPLICABLE QUESTIONS ON THE FORM 990 PERTAINING TO BUSINESS RELATIONSHIPS AMONG TRUSTEES AND OFFICERS, AS WELL AS TO DETERMINE IF THERE ARE ANY TRANSACTIONS WHICH MUST BE REPORTED IN DETAIL ON SCHEDULE L - "TRANSACTIONS WITH INTERESTED PERSONS". IF THE COOPERATIVE WAS UNABLE TO OBTAIN A COMPLETED QUESTIONNAIRE AND/OR TIME LOG, THE COOPERATIVE RELIED UPON THE COMPLETED INFORMATION FOR THE PRIOR YEAR. 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 AND LIFE INSURANCE TO ALL EMPLOYEES THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICERS AND HIGHLY COMPENSATED EMPLOYEES ARE COMPRISED OF ACTUARIAL INCREASE IN THE DEFINED BENEFIT PLAN, THE TOTAL AMOUNT CONTRIBUTED BY THE COOPERATIVE TO THE DEFINED CONTRIBUTION PLAN AND THE INSURANCE PREMIUMS PAID FOR THEIR BENEFIT. IN ADDITION TO THE ABOVE PENSION PLANS, THE COOPERATIVE ALSO PROVIDES POST-RETIREMENT HEALTH INSURANCE BENEFITS THROUGH AN UNFUNDED WELFARE BENEFIT PLAN. THE VALUE OF THESE BENEFITS HAS NOT BEEN ESTIMATED. FORM 990, PART VIII, LINE 2: PATRONAGE DIVIDENDS 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 IX: THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE RUS UNIFORM SYSTEM OF ACCOUNTS (USOA) AS PRESCRIBED FOR RUS ELECTRIC 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. ON THE 2018 FORM 990, PART I, LINE 15, THE COOPERATIVE SEPARATELY STATED SALARIES AND WAGES, EMPLOYEE BENEFITS, AND PAYROLL TAXES THAT ARE ALLOCATED IN ACCORDANCE WITH THEIR ACCOUNTING SYSTEM. ON THE 2017 RETURN THE COOPERATIVE DID NOT SEPARATELY STATE THESE EXPENSES. THE 2017 RETURN IS COMPLETE AND ACCURATE, BUT THE COOPERATIVE BELIEVES BY SEPARATELY STATING THESE EXPENSES ON THE 2018 RETURN A READER OF THE FORM 990 WILL BE MORE INFORMED. FUTURE YEARS RETURNS FILED BY THE COOPERATIVE WILL SEPARATELY STATE SALARIES AND WAGES, EMPLOYEE BENEFITS, AND PAYROLL TAXES, MAKING THE COMPARISON ON PAGE 1 MORE MEANINGFUL. 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 $ 5,636,248 LESS: TRUSTEE FEES REPORTED ON FORMS 1099-MISC (233,250) LESS: EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (302,131) PLUS: SALARIES & WAGES CAPITALIZED DIRECTLY TO PLANT 843,575 PLUS: SALARIES & WAGES CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 364,025 TOTAL WAGES ACCRUED AND/OR PAID $ 6,308,467 FORM 990, PART IX, LINE 24: ADMINISTRATIVE AND GENERAL EXPENSE IS COMPRISED OF THE FOLLOWING: ADMINISTRATIVE & GENERAL $ 1,283,878 OFFICE SUPPLIES 407,322 OUTSIDE SERVICES EMPLOYED 326,312 PENSIONS & BENEFITS 58,996 DUPLICATE CHARGES - CREDIT (29,569) ADVERTISING 90,411 MISCELLANEOUS GENERAL 111,309 DISTRICT & ANNUAL MEETINGS 103,078 DUES TO ASSOCIATED ORGANIZATIONS 161,446 TRUSTEES 373,841 MAINTENANCE OF GENERAL PLANT 797,789 SUBSIDIARY ADMINISTRATIVE & GENERAL 403,922 TOTAL ADMIN & GENERAL EXP PER FINANCIAL STATEMENTS $ 4,088,735 LESS: RECLASS OF TRUSTEE FEES TO PART IX, LINE 5 (233,250) LESS: RECLASS OF LABOR TO PART IX, LINES 5 & 7 (1,719,647) LESS: RECLASS OF BENEFITS TO PART IX, LINES 8-10 (953,131) TOTAL ADMIN & GENERAL EXPENSE PER FORM 990, PART IX $ 1,182,707 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 2018 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, DONATIONS, AND/OR SPONSORSHIPS 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, DONATION, AND/OR SPONSORSHIP 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 5,213,230. PATRONAGE CAPITAL RETIRED - TOTAL -913,624. PATRONAGE CAPITAL RETIRED - DISCOUNT 96,563. UNCLAIMED PATRONAGE CAPITAL RETAINED PER STATE LAW 333,733. OCI - PENSIONS & BENEFITS 2,562,517. NET CHANGE IN MEMBERSHIPS 17,730. FORM 990, PART XII, LINE 2C: THE BOARD OF TRUSTEES HAVE ASSIGNED MEMBERS TO AN AUDIT COMMITTEE TO OVERSEE THE FINANCIAL STATEMENT AUDIT AND SELECT THE INDEPENDENT FINANCIAL STATEMENT AUDITOR. PROCEDURAL CHANGES DID NOT OCCUR DURING THE YEAR. FORM 990, PART XI, LINE 8: THE PRIOR PERIOD ADJUSTMENT OF $5,177,343 RELATES TO THE RECOVERY OF DEFERRED IMPACT AND OTHER FEES FROM PRIOR YEARS. THIS RECOVERY INCREASED THE AMOUNT OF PATRONAGE CAPITAL TO BE ALLOCATED TO THE COOPERATIVE'S PRIOR YEAR PATRONS (2013-2017) TO WHOM SUCH AMOUNTS RELATE. INNOVATION POINTE LLC PO BOX 1809 STILLWATER OK 74076 454383291 SOFTWARE OK 2893942 918240 CENTRAL RURAL ELECTRIC COOPERATIVE INC SCALEDATA LLC PO BOX 1809 STILLWATER OK 74076 462192706 PROFESSIONAL SERVICES OK 168479 143115 CENTRAL RURAL ELECTRIC COOPERATIVE INC CENTRAL COMMUNITY FOUNDATION PO BOX 1809 STILLWATER OK 74076 204700369 DONATIONS OK 501(C)(3) 10 CENTRAL RURAL ELECTRIC COOPERATIVE INC 1 NESI-SES ASSOCATION 3304 SOUTH BOOMER ROAD STILLWATER OK 74074 463845407 DONATIONS OK 501(C)(6) 10 CENTRAL RURAL ELECTRIC COOPERATIVE INC 1 SMART ENERGY SOURCE LLC PO BOX 1809 STILLWATER OK 74074 461116567 PROFESSIONAL SERVICES OK RELATED 3049 0 1 0.51000 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 0 0 1 0 CENTRAL COMMUNITY FOUNDATION N N/A - LESS THAN $50,000 CENTRAL COMMUNITY FOUNDATION O N/A - LESS THAN $50,000 CENTRAL COMMUNITY FOUNDATION R N/A - LESS THAN $50,000 NESI-SES ASSOCIATION N N/A - LESS THAN $50,000 NESI-SES ASSOCIATION O N/A - LESS THAN $50,000 NESI-SES ASSOCIATION R N/A - LESS THAN $50,000