2016-07-21T14:45:08-05:00 2015-12-31 750882037 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2015-01-01 740828412 PEDERNALES ELECTRIC COOPERATIVE INC PEDE 8008684732 PO BOX 1 JOHNSON CITY TX 78636 TRACY GOLDEN CFO 8008684732 2016-07-21 1 WILLIAM M MILLER P00439459 8067473806 2016-07-20 X 2015 2016-09-27 15:27:22Z JOHN HEWA CEO PO BOX 1 JOHNSON CITY TX 78636 591237821 0 X WWW.PEC.COOP X 1938 TX TO FULFILL OUR VISION STATEMENT, WE WILL BE AN ORGANIZATION BASED ON INNOVATION AND EXCELLENCE. 7 7 762 0 0 0 0 0 619296312 586385458 -179295 229032 4328512 4423419 623445529 591037909 391774 397544 34069527 38014625 57171786 50171962 0 0 0 532741242 504859484 624374329 593443615 -928800 -2405706 1414715776 1429554177 905847344 892602592 508868432 536951585 VISION: PEC IS COMMITTED TO SERVING OUR COMMUNITIES THROUGH EXCELLENT MEMBER SERVICES AND SAFE, RELIABLE ENERGY SERVICES AT A COMPETITIVE PRICE; TO GUIDING RESPONSIBLE STEWARDSHIP OF OUR RESOURCES; AND PROVIDING A REWARDING, FAIR, AND SAFE WORK PLACE FOR OUR EMPLOYEES. 0 0 PROVIDING ELECTRIC ENERGY TO OUR MEMBERS - 275,282 ACTIVE SERVICES AT YEAR END. ALL SERVICES THAT WERE ACTIVE DURING THE YEAR WERE PROVIDED ELECTRICITY ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. 0 0 0 0 0 0 0 1 0 1 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 1 0 0 1 271 0 1 762 1 0 0 0 0 0 572047770 61317218 0 X 7 7 0 0 1 0 1 1 1 1 1 1 0 1 1 1 1 1 1 1 1 0 X X TRACY GOLDEN CFO 8308687155 201 SOUTH AVENUE F JOHNSON CITY TX 78636 X JAMES OAKLEY PRESIDENT 8.00 X X 37500 0 0 PATRICK COX PRESIDENT (1/2015 - 6/2015) 30.00 X X 18750 0 0 EMILY PATAKI VICE PRESIDENT 20.00 X X 37500 0 0 PAUL GRAFF DIRECTOR (7/2015 - 12/2015) 26.00 X X 18750 0 0 CRISTI CLEMENT SECRETARY/TREASURER 25.00 X X 37500 0 0 KATHRYN SCANLON DIRECTOR 10.00 X 37500 0 0 LARRY LANDAKER DIRECTOR (1/2015 - 6/2015) 10.00 X 18750 0 0 CHRIS PERRY DIRECTOR 16.00 X 36750 0 0 AMY LEA SJ AKERS DIRECTOR (7/2015 - 12/2015) 15.00 X 18750 0 0 JOHN HEWA CHIEF EXECUTIVE OFFICER 60.00 X 609408 0 108168 LAWANDA PARNELL CHIEF INFORMATION OFFICER 50.00 X 247616 0 22406 TRACY GOLDEN CHIEF FINANCIAL OFFICER 60.00 X 299830 0 49641 MICHAEL J RACIS VP-COMMUNICATIONS & BUSINESS SERVICES 60.00 X 217058 0 44932 LLOYD W MCKEE VP-OPERATIONS 60.00 X 238349 0 75119 EDWARD A DAUTERIVE VP-MEMBER SERVICES 60.00 X 222368 0 54456 INGMAR STERZING VP-POWER SUPPLY & ENERGY SERVICES 50.00 X 174308 0 29942 JULIE BEGGS VP-CORPORATE SERVICES 55.00 X 217018 0 42022 BRADLEY HICKS VP-ENGINEERING & ENERGY INNOVATION 58.00 X 253012 0 49614 DON BALLARD VP-LEGAL SERVICES 48.00 X 242018 0 23770 ROBERT PETERSON DIRECTOR-CONTROL CENTER 50.00 X 225177 0 51018 ROBERT DIFONZO DIRECTOR-DISTRICT OPERATIONS 40.00 X 199478 0 36317 HERBERT GREBE KEY ACCOUNTS MANAGER 40.00 X 187173 0 48619 MICHELLE GALLOWAY DIRECTOR-PROJECT ENGINEERING 52.00 X 189290 0 43808 AISHA HAGEN SENIOR COUNSEL 45.00 X 200399 0 36926 3984252 0 716758 112 0 1 0 T&D SOLUTIONS LLC PO BOX 847280 DALLAS TX 75284 ELECTRIC DIST LINE CONSTRUCTION 10612575 JAMES POWER LINE CONSTRUCTION 43 SHOOTING CLUB RD BOERNE TX 78006 ELECTRIC DIST LINE CONSTRUCTION 7330710 DAVEY RESOURCE GROUP PO BOX 92934 CLEVELAND OH 44194 GIS INVENTORY MAPPING SERIVCE 5952526 LAMBDA CONSTRUCTION I LTD 211 JESSES CIRCLE NEW BRAUNFELS TX 78132 ELECTRIC DIST LINE CONSTRUCTION 3106465 LEWIS TREE SERVICE INC PO BOX 731897 DALLAS TX 75373 TREE TRIMMING & ROW MANAGMENT 3009920 56 X ELECTRIC SALES 221000 563459605 563459605 CUSTOMER SERVICE FEES 221000 8588165 8588165 TRANSMISSION ACCESS 221000 7755674 7755674 TRANSMISSION LEASE 221000 5138308 5138308 PATRONAGE DIVIDEND 221000 1016171 1016171 427535 427535 586385458 184073 184073 244871 199912 44959 44959 44959 POLE ATTACHMENT INCOME 221000 4246486 4246486 MISC NON-OPERATING REVENUE 221000 176933 176933 4423419 591037909 586562391 0 4475518 X 397544 38014625 3482805 30271437 6127042 7872172 2418506 36625923 54533299 PURCHASED POWER 350009858 DISTRIBUTION EXPENSE 20255872 CUSTOMER SERVICE 17286105 ADMIN & GENERAL EXPENSE 16450876 9697551 593443615 X 36792681 74756 50646107 50753551 27433715 27576113 2338360 1681908 1549640952 293745821 1198074109 1255895131 14000000 11434891 11741174 62495989 77525475 11499924 4306069 1414715776 1429554177 88061558 63994649 401575 585174 660194912 657000843 157189299 171021926 905847344 892602592 X 10734531 11127363 0 0 498133901 525824222 508868432 536951585 1414715776 1429554177 X -2405706 30488859 X X 0 1 X 1 0 0 1 X 12070964 12070964 53339635 53339635 1422338442 293736968 1128601474 61891911 8853 61883058 1255895131 ACCRUED OPERATING TAXES & FEES 7631053 ACCUMULATED PROVISION FOR PENSION AND BENEFITS 107885842 CONSUMER DEPOSITS 5715712 POWER COST ADJUSTMENTS - OVER-RECOVERED 3472762 DEFERRED CREDIT - PRMB REGULATORY LIABILITY 22813682 DEFERRED CREDIT - FPCRF REGULATORY LIABILITY 15237048 DEFERRED CREDIT - UNCLAIMED PROPERTY 8265827 171021926 X 591029738 0 591029738 8171 8171 591037909 555420819 0 555420819 38022796 38022796 593443615 PART IV, LINE 2B: PURSUANT TO SECTION 74.3013 OF THE TEXAS PROPERTY CODE, THE COOPERATIVE ESTABLISHED AN ECONOMIC DEVELOPMENT FUND WITH AMOUNTS DESIGNATED UNCLAIMED UNDER STATE LAW. AMOUNTS DEPOSITED INTO THE ECONOMIC DEVELOPMENT FUND ARE APPROVED BY THE STATE OF TEXAS AND CAN ONLY BE USED FOR THE STIMULATION AND IMPROVEMENT OF BUSINESS AND COMMERCIAL ACTIVITY FOR ECONOMIC DEVELOPMENT IN RURAL COMMUNITIES. ANY AMOUNTS SO DEPOSITED INTO THE ECONOMIC DEVELOPMENT FUND ARE STILL PAYABLE TO THE PERSON TO WHOM THE ORIGINAL PAYMENT WAS MADE BUT UNCLAIMED. ALSO PURSUANT TO SECTION 74.3013 OF THE TEXAS PROPERTY CODE, THE COOPERATIVE ESTABLISHED AN ENERGY EFFICIENCY ASSISTANCE FUND WITH AMOUNTS DESIGNATED UNCLAIMED UNDER STATE LAW. AMOUNTS DEPOSITED INTO THE ENERGY EFFICIENCY ASSISTANCE FUND ARE APPROVED BY THE STATE OF TEXAS AND CAN ONLY BE USED TO ASSIST MEMBERS OF AN ELECTRIC COOPERATIVE IN REDUCING THEIR ENERGY CONSUMPTION AND ELECTRICITY BILLS. ANY AMOUNTS SO DEPOSITED INTO THE ENERGY EFFICIENCY ASSISTANCE FUND ARE STILL PAYABLE TO THE PERSON TO WHOM THE ORIGINAL PAYMENT WAS MADE BUT UNCLAIMED. PART X, LINE 2: THE COOPERATIVE 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 DETERMINED THAT IT IS MORE LIKELY THAN NOT THAT ITS TAX POSITION WILL BE SUSTAINED UPON EXAMINATION BY THE INTERNAL REVENUE SERVICE, AND THAT ALL TAX BENEFITS ARE LIKELY TO BE REALIZED UPON SETTLEMENT WITH TAXING AUTHORITIES. PART XI, LINE 4B - OTHER ADJUSTMENTS: OPERATING EXPENSE RECLASSIFIED TO FORM 990 PART IX 8,171. PART XII, LINE 4B - OTHER ADJUSTMENTS: PATRONAGE CAPITAL ASSIGNED 38,014,625. OPERATING EXPENSE RECLASSIFIED TO FORM 990 PART IX 8,171. SCHEDULE D PART VIII THE AMOUNT OF INVESTMENTS - PROGRAM RELATED ON FORM 990, PAGE 11, PART X, LINE 13 DOES NOT EQUAL OR EXCEED 5 PERCENT OF THE TOTAL ASSETS ON FORM 990, PAGE 11, PART X, LINE 16, COLUMN B. CONSEQUENTLY, IN ACCORDANCE WITH IRS INSTRUCTIONS FOR SCHEDULE D, PART VIII HAS BEEN LEFT BLANK. PART IX THE AMOUNT OF OTHER ASSETS ON FORM 990, PAGE 11, PART X, LINE 15 DOES NOT EQUAL OR EXCEED 5 PERCENT OF THE TOTAL ASSETS ON FORM 990, PAGE 11, PART X, LINE 16, COLUMN B. CONSEQUENTLY, IN ACCORDANCE WITH IRS INSTRUCTIONS FOR SCHEDULE D, PART IX HAS BEEN LEFT BLANK. PART XII, LINE 4B PATRONAGE CAPITAL ASSIGNED - $38,014,625 FOR THE AUDITED FINANCIAL STATEMENTS, THE AMOUNT OF PATRONAGE DIVIDENDS PAID (I.E. 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. BECAUSE THE ALLOCATION OF PATRONAGE DIVIDENDS IS ONE ASPECT OF HOW THE COOPERATIVE FULFILLS ITS TAX EXEMPT PURPOSE OF OPERATING ON A COOPERATIVE BASIS, HOWEVER, THE AMOUNT OF PATRONAGE DIVIDENDS 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. 1 PEC UNITED CHARITIES PO BOX 1 JOHNSON CITY TX 78636 742491188 501 (C) (3) 144194 EMPLOYER MATCHING DONATIONS FROM 990, SCHEDULE I, PART IV THE COOPERATIVE SUPPORTS LOCAL GOVERNMENTS, SCHOOLS, CHARITIES, CIVIC ORGANIZATIONS, VOLUNTEER FIRE DEPARTMENTS AND THE LIKE IN THE TWENTY-FOUR COUNTY AREA IN WHICH IT PROVIDES ELECTRICITY TO ITS MEMBERS. SUPPORT THROUGH GRANTS AND DONATIONS IS PROVIDED THROUGH VARIOUS PROGRAMS, INCLUDING THE PEC COMMUNITY GRANT PROGRAM, LIGHT THE WAY PROGRAM, PARTNERS IN LEARNING PROGRAM, PROJECT GRADUATION AND LIVESTOCK SHOW CONTRIBUTIONS. THE COOPERATIVE'S WEBSITE, WWW.PEC.COOP, PROVIDES A DESCRIPTION OF THE REQUIREMENTS AND APPLICATION PROCESS OF EACH PROGRAM. THE LARGER GRANTS ARE AWARDED VIA APPLICATION AND A GRANT COMMITTEE THAT INSURES THE FUNDS ARE BEING UTILIZED FOR THE INTENDED PROCESSES. THE COOPERATIVE ALSO PROVIDES MATCHING CONTRIBUTIONS TO THE PEC UNITED CHARITIES, WHICH ALSO PROVIDES SIMILAR GRANTS AND CONTRIBUTIONS BASED THROUGH AN APPLICATION PROCESS. X X X 0 1 0 JOHN HEWA CHIEF EXECUTIVE OFFICER 559729 0 3750 0 45929 0 79747 0 28421 0 717576 0 25000 0 LAWANDA PARNELL CHIEF INFORMATION OFFICER 226014 0 3750 0 17852 0 12395 0 10011 0 270022 0 0 0 TRACY GOLDEN CHIEF FINANCIAL OFFICER 272166 0 3750 0 23914 0 26500 0 23141 0 349471 0 0 0 MICHAEL J RACIS VP-COMMUNICATIONS & BUSINESS SERVICE 197324 0 3750 0 15984 0 18144 0 26788 0 261990 0 0 0 LLOYD W MCKEE VP-OPERATIONS 216373 0 4090 0 17886 0 48023 0 27096 0 313468 0 0 0 EDWARD A DAUTERIVE VP-MEMBER SERVICES 202610 0 3750 0 16008 0 22391 0 32065 0 276824 0 0 0 INGMAR STERZING VP-POWER SUPPLY & ENERGY SERVICES 155313 0 10170 0 8825 0 16050 0 13892 0 204250 0 0 0 JULIE BEGGS VP-CORPORATE SERVICES 197342 0 3750 0 15926 0 20699 0 21323 0 259040 0 0 0 BRADLEY HICKS VP-ENGINEERING & ENERGY INNOVATION 233218 0 3750 0 16044 0 23922 0 25692 0 302626 0 0 0 DON BALLARD VP-LEGAL SERVICES 222303 0 3750 0 15965 0 13000 0 10770 0 265788 0 0 0 ROBERT PETERSON DIRECTOR-CONTROL CENTER 214727 0 5750 0 4700 0 39606 0 11412 0 276195 0 0 0 ROBERT DIFONZO DIRECTOR-DISTRICT OPERATIONS 168358 0 12381 0 18739 0 26209 0 10108 0 235795 0 0 0 HERBERT GREBE KEY ACCOUNTS MANAGER 161854 0 9021 0 16298 0 20914 0 27705 0 235792 0 0 0 MICHELLE GALLOWAY DIRECTOR-PROJECT ENGINEERING 162805 0 10657 0 15828 0 16986 0 26822 0 233098 0 0 0 AISHA HAGEN SENIOR COUNSEL 193663 0 6090 0 646 0 19725 0 17201 0 237325 0 0 0 PART I, LINE 4B THE FOLLOWING INDIVIDUAL PARTICIPATED IN A SECTION 457(F) NON-QUALIFIED DEFERRED COMPENSATION (NQDC) PLAN. THE AMOUNT LISTED REPRESENTS ACCRUALS UNDER THE PLAN AND IS INCLUDED WITH THE TOTAL OF RETIREMENT AND DEFERRED COMPENSATION BENEFITS REPORTED IN PART II, COLUMN C: JOHN HEWA - $52,632 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/(LOSS) OF $(2,405,706), WHICH IS THE INCOME STATEMENT EFFECT OF ACCRUED UNBILLED REVENUE. 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 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: UNBILLED REVENUE 12/31/15 $23,069,694 UNBILLED REVENUE 12/31/14 (25,475,400) DECREASE EQUALS LOSS ON LINE 19 (A) $(2,405,706) NET MARGIN PER GAAP BASIS INCOME STATEMENT FOR THE CURRENT YEAR (B) 35,608,919 PART I, LINE 14 - BENEFITS PAID TO MEMBERS (I.E. PATRONAGE DIVIENDS) B - A $38,014,625 FORM 990, PART VI, SECTION A, LINE 4 ARTICLE III OF THE BYLAWS WAS AMENDED TO RENAME THE QUALIFICATIONS REVIEW COMMITTEE AS THE QUALIFICATIONS AND ELECTIONS COMMITTEE. 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 DIRECTORS. 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. THE DISPOSAL OF A SUBSTANTIAL PORTION OF THE COOPERATIVE'S ASSETS; AND 4. AMENDMENTS TO ARTICLES OF INCORPORATION. ADDITIONALLY, PEC BYLAWS RESERVE TO MEMBERSHIP THE POWER TO REMOVE DIRECTORS FROM THE BOARD BY A VOTE OF 10% OF THE MEMBERSHIP, WITH NO REQUIREMENT FOR BOARD APPROVAL. THE BYLAWS ALSO ALLOW MEMBERS TO CALL A MEETING BY A PETITION SIGNED BY AT LEAST 10% OF MEMBERS. FORM 990, PART VI, SECTION B, LINE 11 MANAGEMENT PRESENTED A COPY OF THE FORM 990 TO THE BOARD FOR APPROVAL. THIS ACTION WAS TAKEN AT THE BOARD MEETING IMMEDIATELY BEFORE FILING THE FORM 990. FORM 990, PART VI, SECTION B, LINE 12C THE CONFLICT OF INTEREST POLICY REQUIRES ANNUAL AND ONGOING COMPLETION OF A CONFLICT OF INTEREST CERTIFICATION AND DISCLOSURE FORM BY ALL DIRECTORS, OFFICERS, KEY EMPLOYEES, OR MANAGERS OF THE COOPERATIVE. THE FORM, WHICH IS PART OF THE POLICY, INCLUDES AN AFFIRMATION THAT THE INDIVIDUAL WILL INFORM THE BOARD OF ANY NEW CONFLICT AFFECTING THEMSELVES OR ANY OTHER PERSON. EACH JANUARY, THESE DOCUMENTS ARE SOLICITED AND GATHERED BY THE CUSTODIAN OF THESE RECORDS, WHICH INCLUDES THE BOARD'S SECRETARY FOR BOARD MEMBERS AND PEC'S HUMAN RESOURCES DEPARTMENT FOR APPLICABLE EMPLOYEES. APPLICABLE PERSONS WHO JOIN THE COOPERATIVE ARE SUBJECT TO THE POLICY AND ARE REQUIRED TO FILE THE FORM AT THE OUTSET OF THEIR EMPLOYMENT OR DIRECTORSHIP. THE COMPLETED BOARD OF DIRECTORS DISCLOSURE AFFIRMATIONS ARE FORMALLY ACCEPTED BY THE BOARD PRESIDENT IN A MEETING OPEN TO THE PUBLIC AND ARE PART OF THE PUBLIC MINUTES OF THE COOPERATIVE. FORM 990, PART VI, SECTION B, LINE 15 A COMPREHENSIVE COMPENSATION ASSESSMENT IS RUN ON NEWLY PROMOTED OR NEWLY HIRED EXECUTIVE POSITIONS TO DETERMINE THE MOST APPROPRIATE BEGINNING SALARY FOR THAT POSITION. THE COMPARABLE MARKET USED IS THAT OF A COMPANY IN THE ENERGY AND UTILITIES INDUSTRY IN AUSTIN, TEXAS WITH 500-1000 FULL TIME EQUIVALENTS. INDIVIDUAL FACTORS ARE ALSO USED IN DETERMINING THE APPROPRIATE BEGINNING SALARY. THESE INDIVIDUAL FACTORS INCLUDE EMPLOYEE TRAITS, SUCH AS YEARS OF EXPERIENCE, EDUCATION, AND CERTIFICATIONS, AS WELL AS, JOB TRAITS, SUCH AS TO WHOM THE POSITION REPORTS, NUMBER OF DIRECT REPORTS, AND JOB DUTIES. POSITIONS ARE MOST CLOSELY MATCHED TO A JOB DESCRIPTION IN THE COMPENSATION DATABASE WITH SIMILAR JOB DUTIES, EDUCATION, AND EXPERIENCE REQUIREMENTS. IN SOME CASES, DEPENDING ON THE POSITION, A HYBRID OF THE JOB IS COMPLETED TO MORE ACCURATELY REFLECT THE PEC POSITION JOB DUTIES. THE BEGINNING PROPOSED BASE SALARY IS BETWEEN THE 25TH AND 50TH PERCENTILE OF THE PREDICTED MEDIAN MARKET SALARY TAKING INTO CONSIDERATION TOTAL COMPENSATION. THE COST OF BENEFITS FOR PEC AT THIS LEVEL IS TYPICALLY BETWEEN 21% AND 45%. THE COST OF BENEFITS FOR THE MARKET IS TYPICALLY BETWEEN 23% AND 32%. FORM 990, PART VI, SECTION C, LINE 19 THE COOPERTIVE'S GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS ARE AVAILABLE TO THE PUBLIC ON THE COOPERTIVE'S WEBSITE. INFORMATION NOT POSTED ON THE WEBSITE IS AVAILABLE UPON REQUEST. FORM 990, PART VI, QUESTION 9 THE NAME AND ADDRESSES OF DIRECTORS, OFFICERS AND HIGHLY COMPENSATED EMPLOYEES, WHO CANNOT BE REACHED AT THE COOPERATIVE'S ADDRESS, ARE AS FOLLOWS: PATRICK COX 570 RIVER MOUNTAIN ROAD WIMBERLEY, TX 78676 CHRIS PERRY 1004 QUAIL RIDGE DR DRIPPING SPRINGS, TX 78620 FORM 990, PART VII, COLUMN F IN ORDER TO PROVIDE RETIREMENT BENEFITS TO ITS EMPLOYEES, THE COOPERATIVE PROVIDES A DEFINED BENEFIT PLAN TO EMPLOYEES MEETING THE ELIGIBILITY REQUIREMENTS. HOWEVER, THE PLAN WAS CLOSED TO NEW PARTICIPANTS AFTER JANUARY 1, 2006. CONTRIBUTIONS TO THIS PLAN ARE BASED ON THE FULL FUNDING LIMITATION OF SUCH PLAN. ADDITIONALLY, THE COOPERATIVE PARTICIPATES IN A DEFINED CONTRIBUTION PLAN UNDER SECTION 401(K) OF THE INTERNAL REVENUE CODE. EMPLOYER CONTRIBUTIONS TO THE PLAN ARE AVAILABLE TO PARTICIPATING EMPLOYEES, INCLUDING OFFICERS AND HIGHLY COMPENSATED EMPLOYEES, MEETING THE ELIGIBILITY REQUIREMENTS OF THE PLAN. THE COOPERATIVE ALSO PROVIDES HEALTH, DENTAL AND LIFE INSURANCE TO ALL ELIGIBLE EMPLOYEES THROUGH A QUALIFIED PLAN. THE AMOUNT REPORTED ON PART VII COLUMN (F) FOR THE OFFICERS AND HIGHLY COMPENSATED EMPLOYEES IS COMPRISED OF THE ACTUARIAL INCREASE ASSOCIATED WITH PARTICIPATION IN THE DEFINED BENEFIT PLAN, IF APPLICABLE,THE TOTAL AMOUNT CONTRIBUTED BY THE COOPERATIVE TO THE 401(K) PLAN AND INSURANCE PAID ON BEHALF OF AND FOR BENEFIT OF THE OFFICERS AND HIGHLY COMPENSATED EMPLOYEES. IN ADDITION TO THE ABOVE PENSION PLANS, THE COOPERATIVE ALSO PROVIDES POST-RETIREMENT HEALTH INSURANCE BENEFITS THROUGH AN UNFUNDED WELFARE BENEFIT PLAN. THE PER PERSON 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 COOPERATIVE UTILIZES THE UNIFORM SYSTEM OF ACCOUNTS (USOA) ESTABLISHED BY THE RURAL UTILITIES SERVICES. THE USOA DOES NOT RECORD EXPENSES IN THE GENERAL EXPENSE CATEGORIES PROVIDED ON PART IX LINES 1 - 23. FOR FORM 990 REPORTING PURPOSES, THE COOPERATIVE SEPARATELY REPORTS DONATIONS, SALARIES AND WAGES, EMPLOYEE BENEFITS AND PAYROLL TAXES THAT ARE ALLOCATED IN ACCORDANCE WITH ITS ACCOUNTING SYSTEM. OTHER EXPENSES DESCRIBED IN LINES 1 - 23, HOWEVER, ARE REPORTED ON LINE 24 UNDER THE EXPENSE CATEGORIES REQUIRED BY THE USOA. FORM 990, PART IX, LINE 24D GENERAL AND ADMINISTRATIVE EXPENSES ARE COMPRISED OF THE FOLLOWING: OFFICE SUPPLIES EXPENSE $2,961,635 CONTRACT SERVICES 6,493,827 INJURIES & DAMAGES 246,212 RENTS 649,483 MAINTENANCE OF GENERAL PLANT 1,832,102 GENERAL EXPENSES 4,267,617 TOTAL ADMINISTRATIVE AND GENERAL EXPENSE PER FORM 990 $16,450,876 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 SCHDULE RECONCILES AMOUNTS REPORTED ON LINES 5-7 TO TOTAL WAGES ACCRUED AND/OR PAID: TOTAL PER LINES 5-7 $33,754,242 LESS DIRECTORS FEES REPORTED ON 1099-MISC (261,750) LESS EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (500,072) PLUS SALARIES & WAGES CAPITALIZED DIRECTLY TO PLANT AND CAPITALIZED/EXPENSED INDIRECTLY THROUGH CLEARING & OTHER ACCOUNTS 25,746,766 TOTAL WAGES ACCRUED AND/OR PAID $58,739,186 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 WAS ALLOCATED TO THE PATRONS RESULTING FROM THEIR PURCHASE OF ELECTRICITY FROM THE COOPERATIVE FOR THE 2015 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 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 24E OTHER EXPENSES ARE COMPRISED OF THE FOLLOWING: SALES EXPENSE $ 114,101 TRANSMISSION OPERATION & MAINTENANCE EXPENSE 2,935,794 FRANCHISE FEES 5,601,098 GROSS RECEIPTS TAXES 950,974 OTHER DEDUCTIONS 95,584 TOTAL OTHER EXPENSES PER FORM 990 $9,697,551 FORM 990, PART IX, LINE 24A THE COOPERATIVE'S WHOLESALE POWER SUPPLIERS ARE (1) THE LOWER COLORADO RIVER AUTHORITY AND (2) AEP ENERGY PARTNERS, INC. THE $350,009,858 OF PURCHASED POWER EXPENSE, REPORTED ON LINE 24A, IS COMPRISED OF PAYMENTS MADE TO EACH. FORM 990, PART X, LINES 17 AND 25 THE COOPERATIVE PREVIOUSLY INCLUDED ACCRUED EXPENSES, COMPRISED OF (1)ACCRUED PAYROLL AND COMPENSATED ABSENCES, (2) ACCRUED INTEREST, AND (3) OTHER CURRENT ACCRUED LIABILITES, AS COMPONENTS OF OTHER LIABILITIES ON LINE 25 OF PART X. HOWEVER, FOR THE 2015 CALENDAR YEAR, THE COOPERATIVE BEGAN REPORTING THESE AMOUNTS ON LINE 17. TO INCREASE CONSISTENCY, THE TOTAL AMOUNT OF $8,224,603 FOR THESE ACCRUED EXPENSES FOR THE 2014 CALENDAR YEAR HAVE BEEN RECLASSIFIED FROM LINE 25 TO LINE 17. FORM 990, PART XI, LINE 9: NET CHANGE IN MEMBERSHIPS 392,832. PATRONAGE CAPITAL RETIRED - TOTAL -28,473,958. PATRONAGE CAPITAL RETIRED - DISCOUNT 20,376,263. PATRONAGE CAPITAL ASSIGNED 38,014,625. TRANSFERS TO OTHER EQUITIES 179,097. FORM 990, PART XII, LINE 2C THE BOARD OF DIRECTORS 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. PEDERNALES ELECTRIC COOPERATIVE SCHOLARSHIP FUND 201 S AVENUE F JOHNSON CITY TX 78636 742897600 TO PROVIDE SCHOLARSHIPS FOR POST-SECONDARY EDUCATION TX 501(C)(3) PF PEDERNALES ELECTRIC COOPERATIVE INC 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 1 0 0 PEDERNALES ELECTRIC COOPERATIVE SCHOLARSHIP FUND - NA LESS THAN 50000 O PEDERNALES ELECTRIC COOPERATIVE SCHOLARSHIP FUND - NA LESS THAN 50000 Q