2013-05-09T18:14:16-05:00 2012-06-30 ERNST & YOUNG US LLP 401 CONGRESS SUITE 1800 AUSTIN TX 78701 990 2011-07-01 742129255 BRAZOS HIGHER EDUCATION SERVICE CORPORATION % RICKY TURMAN CFO EVP BRAZ 2547530915 PO BOX 1308 WACO TX 76703 RICKY TURMAN 2013-05-09 5124789881 2011 2016-02-25 16:41:14Z RICKY TURMAN 2600 WASHINGTON AVENUE WACO TX 76710 22749510 false X www.brazos.us.com X 1980 TX To provide management and administrative support for affiliated entities student loan servicing needs. 10 10 76 0 0 0 0 0 17280054 21935545 3092072 531208 463523 282757 20835649 22749510 100000 1351797 0 0 10467740 9660224 0 0 0 4467620 4813016 15035360 15825037 5800289 6924473 40497268 48267417 5927747 6480185 34569521 41787232 To provide management and administrative support for affiliated ENTITIES STUDENT LOAN SERVICING NEEDS. false false 13250553 1351797 22200381 Administrative and Management services for affiliated non-profit entities. As master servicer, Brazos Higher Education Service Corporation provided management services for 7 nonprofit student loan companies. This included administering over 1.1 million loans with outstanding principal in excess of $10 billion under the Federal Family Education Loan Program (FFELP). Heal, TERI, and various other alternative loan programs. 13250553 true false false true false false false false false false true false false true true true true false false false false false false false false false false true false true false false false true false true false false false false false false false true true true false false true 58 0 true 76 true false false false false false false false false false false X 10 10 true false false false false false false true true false false true true true true true true true true false X RICKY TURMAN CFO EVP 2547530915 2600 Washington Avenue Waco TX 76710 X Bob Chambers 1.0 X 0 0 0 Paul Marable Jr 1.0 X 0 0 0 Mrs Joyce Packard 1.0 X 0 0 0 Norman Hay Jr 1.0 X 0 0 0 David Smith Jr 1.0 X 0 0 0 John Perry 1.0 X 814 0 0 Dr Joseph Velez 1.0 X 0 0 0 Tom Chase 1.0 X 759 0 0 Wilton Lanning 1.0 X 861 0 0 Scott Felton 1.0 X 814 0 0 Murray Watson 32.0 X 1183043 0 32770 Ricky Turman 32.0 X 493810 0 43883 David Horner 32.0 X 454978 0 40649 Michael Macomber 40.0 X 380729 0 46315 Ellis Tredway 38.0 X 338722 0 38101 Kelli Villarrial 32.0 X 270736 0 30872 Randall Larson 40.0 X 236097 0 30883 Tammy Harralson 32.0 X 202037 0 31284 Janice White 39.0 X 196915 0 18073 Daniel Reyna 32.0 X 142909 0 17620 Thomas Litle 32.0 X 239578 0 28098 Andrew Ellis 40.0 X 140162 0 20463 James McInnis 32.0 X 101285 0 17820 Susan Davis 32.0 X 73656 14026 Samuel Redden 40.0 X 265828 0 34414 Ray Rushing 32.0 X 0 0 0 John M Wright 40.0 X 182468 0 24204 Sarah MacCarthy 40.0 X 173730 0 21661 Justin Green 40.0 X 171121 0 29339 Debra Urias 40.0 X 167199 0 24152 Rebecca Harland 40.0 X 155324 0 25842 Adele Williams 40.0 X 102209 0 30082 Milicent Larson 40.0 X 108841 0 28440 5784625 0 628991 24 true true false Murray Watson Jr 2600 Washington Avenue WACO TX 76710 LEGAL 558039 Graduate Leverage 400 5th Ave Suite 205 WALTHAM MA 02451 LOAN SERVICING 500000 Roger Saylor Saylor Consulting 9 Northview Avenue MONTCLAIR NJ 07043 MGMT CONSULTING 475875 Mayer Brown LLP 2027 Collection Center Dr CHICAGO IL 60693 Legal 403985 Ernst Young LLP PO BoX 848107 DALLAS TX 75284 AUDIT AND TAX FEES 388494 11 0 Administration Services Income 522294 130000 130000 Beneficial interest (M&O) 522294 7512288 7512288 Operating Income (M&O) 522294 14247909 14247909 Financial advisory fees from affiliate 522294 32606 32606 Amortization of deferred income 522294 12742 12742 21935545 531208 531208 0 0 17921 17921 17921 17921 0 0 0 0 ROYALTY INCOME 522294 235651 235651 MARKETING AND REFERRAL 522294 18224 18224 MISC INCOME 522294 10961 10961 264836 22749510 22200381 549129 1351797 1351797 0 0 0 4356992 3921293 435699 0 3754842 3379358 375484 618469 556622 61847 514801 463321 51480 415120 373608 41512 822272 822272 588625 529762 58863 536926 483233 53693 352912 352912 0 0 0 29476 29476 596290 536661 59629 244604 220143 24461 0 402799 362519 40280 143947 129552 14395 0 61826 55644 6182 0 0 144739 130265 14474 318857 286971 31886 SERVICING EXPENSE 160055 160055 DUES & SUBSCRIPTIONS 99663 89697 9966 ENTERTAINMENT EXPENSE 61552 61552 DIRECTOR'S EXPENSE 18938 18938 229535 190576 38959 15825037 13250553 2574484 0 9785215 7260607 15890123 13288189 0 0 244945 135115 477434 528593 0 0 2750000 5525000 0 0 327166 159695 2738966 1506884 1211445 1232082 0 4877881 255753 255753 0 0 0 0 9555187 15004502 40497268 48267417 699944 1054710 0 0 151845 139102 0 0 0 0 0 0 0 0 0 0 5075958 5286373 5927747 6480185 X 34569521 41787232 0 0 0 0 34569521 41787232 40497268 48267417 X 6924473 293238 X false true true X false X 51262198 25556405 15372796 17280054 21935545 131406998 51262198 25556405 15372796 17280054 21935545 131406998 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 131406998 851672 178160 1384038 3131072 549129 6094071 851672 178160 1384038 3131072 549129 6094071 1675 0 0 0 0 1675 60377 2186 77751 475990 264836 881140 52175922 25736751 16834585 20887116 22749510 138383884 0.94958 0.94808 0.04404 0.04679 X false false false false false false true 352912 false false 352912 false Schedule C, Part II-B Lobbying Outside lobbyists were hired to advise Brazos on appropriate strategies and actions regarding legislation that would have a harmful impact on Brazos interests. In addition, lobbyists were charged with monitoring the introduction and the progress on legislation/rules that required Brazos compliance in all areas of the business. Legislation issues included budget reconciliation, reauthorization of the Higher Education Act, tax-exempt issues and privacy issues. 68000 68000 2107027 1001037 1105990 563939 505847 58092 1232082 Assets Held in Escrow 5112031 DUE FROM AFFILIATES 9601432 ACCRUED INTEREST 291014 OTHER ASSETS 25 15004502 0 Servicing Recourse Reserve 144738 Prefunded Benefit Payable 5141635 5286373 22749510 15825037 6924473 293238 293238 7217711 22749510 22749510 22749510 15825037 15825037 15825037 Reconciliation of Change in Net Assets Part XI, Line 8 Transfer to Affiliate - $ 293,238 FIN 48 (ASC 740) Footnote The Company follows the accounting standard related to the accounting for uncertainty in income taxes recognized in the Companys financial statements. The standard prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company currently does not have any positions reserved. true Baylor University - Endowed Scholarship fund 1612 S University Parks Dr Waco TX 76706 741159753 501(C)(3) 200000 Contribution to Endowed Scholarship McLennan Community College 1400 College Dr Waco TX 76708 742550278 501(c)(3) 50000 Contribution to Endowed Scholarship Texas State Technical College 3801 Campus Dr Waco TX 76705 741646989 501(c)(3) 50000 Contribution to Endowed Scholarship Texas State Technical College 3801 Campus Dr Waco TX 76705 741646989 501(c)(3) 1000000 Contribution to Culinary Arts Building Fund Dr Pepper Entrepreneur Program 300 S 5th Street Waco TX 76701 742497117 501(c)(3) 20000 High school entrepreneur program Waco Scottish Rite Charitable Fund 2801 West Waco Drive Waco TX 76701 742177244 501(c)(3) 10000 Camp success program for kids Reach Therapeutic Riding Center 525 Austin Hines China Springs TX 76633 261856333 501(c)(3) 20000 Contribution to scholarship fund 6 0 Form 990, Schedule I Description of Organization's Procedures for Monitoring the Use of Grants PROVIDED 501(C)(3) ORGANIZATIONS WITH DONATED FUNDS FOR USE IN THEIR GENERAL SCHOLARSHIP FUNDS AND FOR CONSTRUCTION OF A CULINARY ARTS BUILDING. MONITORING THE USE OF THESE FUNDS IS NOT REQUIRED. X X X true true X X X false false false false false false false false false Murray Watson 554135 0 561918 0 66990 0 24500 0 8270 0 1215813 0 0 0 Ricky Turman 276657 0 200653 0 16500 0 24500 0 19383 0 537693 0 0 0 David Horner 242206 0 179124 0 33648 0 24500 0 16149 0 495627 0 0 0 Michael Macomber 198000 0 154479 0 28250 0 24500 0 21815 0 427044 0 0 0 Ellis Tredway 174439 0 134399 0 29884 0 24500 0 13601 0 376823 0 0 0 Kelli Villarrial 168376 0 86036 0 16324 0 24500 0 6372 0 301608 0 0 0 Randall Larson 160946 0 75151 0 0 0 23813 0 7070 0 266980 0 0 0 Tammy Harralson 119209 0 66328 0 16500 0 20753 0 10531 0 233321 0 0 0 Janice White 105196 0 59111 0 32608 0 15045 0 3028 0 214988 0 0 0 Daniel Reyna 89496 0 44919 0 8494 0 14157 0 3463 0 160529 0 0 0 Thomas Litle 199793 0 23285 0 16500 0 23898 0 4200 0 267676 0 0 0 Andrew Ellis 73385 0 44746 0 22031 0 13641 0 6822 0 160625 0 0 0 Samuel Redden 154406 0 82799 0 28623 0 24500 0 9914 0 300242 0 0 0 John M Wright 101413 0 55357 0 25698 0 17494 0 6710 0 206672 0 0 0 Sarah MacCarthy 117007 0 41726 0 14997 0 16861 0 4800 0 195391 0 0 0 Justin Green 99015 0 55530 0 16576 0 12618 0 16721 0 200460 0 0 0 Debra Urias 112723 0 54476 0 0 0 16937 0 7215 0 191351 0 0 0 Rebecca Harland 94037 0 51667 0 9620 0 16033 0 9809 0 181166 0 0 0 Adele Williams 65094 0 30296 0 6819 0 11460 0 18622 0 132291 0 0 0 Milicent Larson 69986 0 38855 0 0 0 12022 0 16418 0 137281 0 0 0 Supplemental Compensation Information Travel for companions - Occasionally, travel for companions for board members and officers is paid by BHESC. In these instances, unreimbursed travel is either reported as compensation on their W-2 or through a 1099-MISC, whichever is applicable. Murray Watson received these benefits. Social Club dues - Social club dues are paid for Murray Watson. The personal use of these dues is reported as compensation on Form W-2. Personal Services - A driver is provided for Murray Watson. The personal use of these services is reported as compensation on Form W-2. MURRAY WATSON JR PERSONAL LIFE INSUR X 2340 528593 false true true 528593 MURRAY WATSON Associates Murray Watson, officer 607048 LEGAL FEES false Schedule L, Part II Loans to and/or From Interested Persons Personal life insurance for Mr. Watson and his spouse. Brazos Higher Education Service Corporation pays premiums for a life insurance policy owned by Murray Watson and his spouse. The agreement between the company and Mr. Watson is the loan is due and payable at the death of both him and his spouse, payable from the estate. Interest on the loan is calculated and included in Mr. Watson's annual W-2 as taxable income. Supplemental Information Form 990, Part VI, Question 2 Murry Watson, Jr., Randall Larson and Milicent Larson have a family relationship. Ray Rushing and Murray Watson, Jr. have a business relationship. Form 990, Part VI, Question 11b Describe the Process used by Management &/or Governing Body to Review 990 The 990 tax return is provided to senior management for their review. After their review, the return is posted on a secure website for review by the board of directors. The Board is notified of the posting and asked to provide comments or questions. Form 990, Part VI, Question 12c Description of Process to Monitor Transactions for Conflicts of Interest Brazos Higher Education Service Corporation's internal audit department annually prepares a conflict of interest survey. This survey is designed for, a) board members, officers, directors, and key employees, and b) all other employees. The internal audit department reviews the responses from each group and identifies potential conflicts based on criteria provided in the Conflict Of Interest (COI) policy. These conflicts, if considered material, are tabulated and provided to the board of directors for review and resolution. If these conflicts are considered immaterial, these are provided to executive management for review and resolution. Form 990, Part VI, Question 15a Offices & Positions for Which Process was Used, & Year Process was Begun Brazos Higher Education Service Corporation's Board of Directors uses an independent third party to review the President's compensation. The third party reviews each element of compensation to ensure it is in compliance with IRS regulations as well as compares the compensation to other comparable entities to determine it is in line with their compensation amounts. The salary is reviewed and approved by the board of directors. Form 990, Part VI, Question 15b Offices & Positions for Which Process was Used, & Year Process was Begun An independent third party reviews the compensation of the officers and key employees to ensure it is within IRS guidelines. The third party also performs comparability studies of related organizations to determine whether salaries are reasonable. The salaries are reviewed and approved by the board of directors. Form 990, Part VI, Question 19 Avail of Gov Docs, Conflict of Interest Policy, & Fin Stmts to Gen Public The governing documents, conflict of interest policy, and financial statements are available to the general public on request. FORM 990, PART XI, line 5 Other changes in net assets or fund balances Transfer from Affiliate - $ 293,238 Additional Information RECENT LEGISLATIVE DEVELOPMENTS On March 30, 2010, President Obama signed into law the Reconciliation Act of 2010. Effective July 1, 2010, this law prohibits new loan originations under the FFELP and requires that all new federal loan originations be made through the Direct Loan Program. In the event that a first disbursement has been made on a FFELP loan prior to July 1, 2010, subsequent disbursements of that loan may still be made under the FFELP. Additionally, the new law does not alter or affect the terms and conditions of the existing FFELP loans held by affiliated entities for which Brazos Higher Education Service Corporation serves as master servicer. HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Bob Chambers TITLE:Chairman HOURS:6 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Paul Marable, Jr. TITLE:Director HOURS:7 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Mrs. Joyce Packard TITLE:Vice Chairman HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Norman Hay, Jr. TITLE:Director HOURS:2 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:David Smith, Jr. TITLE:Director HOURS:7 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:John Perry TITLE:Director HOURS:4 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Dr. Joseph Velez TITLE:Director HOURS:3 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Tom Chase TITLE:Director HOURS:3 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Wilton Lanning TITLE:Director HOURS:6 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Scott Felton TITLE:Director HOURS:1 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Murray Watson TITLE:President HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Ricky Turman TITLE:EVP / CFO HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:David Horner TITLE:EVP/Special Asst to President HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Ellis Tredway TITLE:EVP/Gov. Affairs & Strat Plng HOURS:2 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Kelli Villarrial TITLE:Associate General Counsel HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Tammy Harralson TITLE:Controller/VP HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Janice White TITLE:Administration VP HOURS:1 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Daniel Reyna TITLE:Internal Audit Director HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Thomas Litle TITLE:VP Legal Affairs/Inden Ovrsght HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:James McInnis TITLE:Treasury and Budget Director HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Susan Davis TITLE:Assistant to Admin. VP HOURS:8 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Ray Rushing TITLE:Secretary HOURS:8 Acapita Education Finance Corporation PO BOX 1308 WACO TX 76703 742542435 fund std lns TX 501(c)(3) 9 NA true Brazos Education Loan Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203868073 fund std lns TX 501(c)(3) 9 NA true Paluxy Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203868139 fund std lns TX 501(c)(3) 9 NA true Rozell Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203867891 fund std lns TX 501(c)(3) 9 NA true Sabine Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203868185 fund std lns TX 501(c)(3) 9 NA true Texoma Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203868230 fund std lns TX 501(c)(3) 9 NA true Brazos Education Foundation Inc 2612 WASHINGTON AVENUE WACO TX 76710 264562436 grant making TX 501(c)(3) 7 NA true Academic Finance Corporation PO BOX 1308 WACO TX 76703 742540458 fund std lns TX 501(c)(3) 9 NA true Education Servicing Mgmt Corporation 2600 WASHINGTON AVENUE WACO TX 76710 203870046 fund std lns TX 501(c)(3) 9 NA true Brazos Education Finance Corporation In 2600 WASHINGTON AVENUE WACO TX 76710 742539632 fund std lns TX 501(c)(3) 11 type 1 NA true Atlantic Student Finance Corporation 2600 WASHINGTON AVENUE WACO TX 76710 205412189 fund std lns FL 501(c)(3) 7 NA true Brazos Higher Education Authority Inc PO BOX 1308 WACO TX 76703 742099402 fund std lns TX 501(c)(3) 11 type 1 NA true Bosque Higher Education Authority Inc PO BOX 1308 WACO TX 76703 742534099 fund std lns TX 501(c)(3) 9 NA true Brazos Student Finance Corporation PO BOX 1308 WACO TX 76703 742356109 fund std lns TX 501(c)(3) 9 NA true EdInvest Company 2600 WASHINGTON AVENUE WACO TX 76710 742537669 fund std lns TX 501(c)(3) 9 NA true Educational Funding Services Inc PO BOX 1308 WACO TX 76703 330947525 fund std lns CA 501(c)(3) 9 NA true Federated Student Finance Corporation 2600 WASHINGTON AVENUE WACO TX 76710 742536239 fund std lns TX 501(c)(3) 9 NA true Trinity Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 742534486 fund std lns TX 501(c)(3) 9 NA true Angelina Higher Education Authority 2600 WASHINGTON AVENUE WACO TX 76710 200115078 fund std lns TX 501(c)(3) 9 NA true Concho Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203870081 fund std lns TX 501(c)(3) 9 NA true Frio Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203870120 fund std lns TX 501(c)(3) 9 NA true Lavaca Higher Education Authority Inc 2600 WASHINGTON AVENUE WACO TX 76710 203870153 fund std lns TX 501(c)(3) 9 NA true Leon Higher Education Authority Inc 203870176 fund std lns TX 501(c)(3) 9 NA true Llano Higher Education Authority Inc 203870219 fund std lns TX 501(c)(3) 9 NA true false true true true false false false false false false true false false true false false false false Angelina Higher Education Authority b 186110 fmv Brazos Student Finance Corporation c 479347 fmv Brazos Higher Education Authority d 3500000 fmv Brazos Higher Education Authority Inc k 10765850 fmv Brazos Student Finance Corporation k 1525725 fmv Bosque Higher Education Authority Inc k 61423 fmv Federated Student Finance Corporation k 260119 fmv EdInvest Company k 134545 fmv Acapita Education Finance Corporation k 1452034 fmv