2011-08-11T14:49:38-05:00 2010-12-31 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2010-01-01 850096243 LEA COUNTY ELECTRIC COOPERATIVE INC LEAC 5753963631 PO BOX 1447 LOVINGTON NM 882601447 GARY HURSE 5753963631 2011-08-01 1 Matt R Willis 8067473806 2011-08-01 2010 2016-02-24 21:20:13Z GARY HURSE PO BOX 1447 LOVINGTON NM 882601447 74829423 0 X WWW.LCECNET.COM X 1949 NM TO PROVIDE ELECTRIC ENERGY TO RURAL AREAS AT COST ON A COOPERATIVE BASIS. 9 9 113 0 1800 800 0 0 63877586 72722753 1898161 1740332 187165 106162 65962912 74569247 0 21591 0 0 5716629 5183827 0 0 0 58123670 64285397 63840299 69490815 2122613 5078432 130791519 137363836 71388256 73105922 59403263 64257914 THE COOPERATIVE'S RESPONSIBILITY AND AIM IS TO PROVIDE EXCELLENT AND INNOVATIVE CUSTOMER SERVICE AS REFLECTED IN TOP QUALITY ELECTRIC SERVICE RELIABILITY, AFFORDABLE RATES, EMPLOYEE TEAMWORK AND THE HIGHEST DEGREE OF INTEGRITY IN ALL COOPERATIVE ENDEAVERS. 0 0 SALE OF ELECTRIC POWER TO MEMBERS - 15,250 CONNECTED METERS 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 1 0 0 1 1 1 0 1 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 1 1 1 0 0 1 64 0 113 1 1 1 0 0 0 0 73784352 2119540 0 X 9 9 0 0 0 0 1 1 1 1 1 0 0 1 0 0 0 1 0 0 X GARY HURSE 5753963631 1300 W AVENUE D LOVINGTON NM 882601447 JOHN INGLE 18.50 X X 26962 0 0 DEAN K KINSOLVING 2.30 X X 9367 0 0 DAN HARDIN 2.70 X X 5417 0 0 WILLIAM PALMER 7.10 X 25364 0 0 THURMAN F DUNCAN 2.10 X 20411 0 0 TERRY DAVIS 2.60 X 20876 0 0 BILLY ROYCE MEDLIN 3.40 X 20634 0 0 ROBERT CAUDLE 9.00 X 27285 0 0 WK ROBERTS 3.10 X 20735 0 0 RAY HILBURN 3.00 X 0 0 0 GL HURSE 50.00 X 200281 0 48896 MICHAEL SARKIS 55.00 X 114766 0 71414 JOHN BENARD 50.00 X 110125 0 67876 MICHAEL FARIS 50.00 X 103797 0 65073 JANETTE FARIS 50.00 X 100901 0 71978 806921 0 325237 5 0 1 0 POWERLINE INC 583 US HIGHWAY 70 CLOVIS NM 88101 LINE CONSTRUCTION 1171980 ZIA ELECTRICAL PRODUCTS PO BOX 482 MOUNTAINAIRE NM 87036 METER TESTING/INSTALLATION 383216 JUPITER ELECTRICAL SERVICE PO BOX 1312 ANDREWS TX 79714 LINE CONSTRUCTION 206200 SGS WHITTER INC PO BOX 842538 ALBUQUERQUE NM 82284 ENGINEERING CONSULTANT 160310 C & H POWER LINE INC 1847 E PORTLAND AVE DEWEY OK 74029 LINE CONSTRUCTION 152028 8 SALES OF ELECTRICITY 221000 72608476 72608476 PATRONAGE DIVIDENDS 221000 80557 80557 CONNECT FEES 221000 33720 33720 72722753 1795125 1795125 540 101010 540 101010 101550 1800 99750 25500 80293 -54793 -54793 -54793 184495 179883 4612 4612 74569247 72727365 1800 1840082 21591 426229 3143757 254100 1116867 242874 1174724 3056974 COST OF PURCHASED POWER 54081870 DISTRIBUTION EXPENSE 2185418 COST OF REMOVAL 1418047 ADMIN AND GENERAL 1193140 CUSTOMER ACCOUNTS 665937 509287 69490815 1134749 2633332 11979166 4361471 5777397 7318298 2523504 2524390 2721260 2920467 132459387 59665905 62206131 72793482 37310602 36348468 592425 540527 1004141 1012254 5542144 6911147 130791519 137363836 5371549 4958917 1891998 2162101 23774909 25118395 40349800 40866509 71388256 73105922 X 33050 33235 2772151 2772151 56598062 61452528 59403263 64257914 130791519 137363836 X 5078432 -223781 X X 0 1 0 X 0 372404 372404 6588568 1639102 4949466 118965983 58026803 60939180 6532432 6532432 72793482 NON-UTILITY PROPERTY 46482 ACCRUED UNBILLED REVENUE 5574665 POST RETIREMENT BENEFIT 1290000 6911147 COST OF REMOVAL LIABILITY 34840320 CONSUMER DEPOSITS 2009896 OTHER CURRENT AND ACCRUED LIABILITIES 4016293 40866509 Description of Uncertain Tax Positions Under FIN 48: Part X: ON JANUARY 1, 2009, THE COOPERATIVE ADOPTED 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 VIII: THE AMOUNT OF INVESTMENTS - PROGRAM REELATED 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 SCHEDULE D, PART VIII HAS BEEN LEFT BLANK. Part VII: THE AMOUNT OF INVESTMENTS - OTHER SECURITIES ON FORM 990, PAGE 11, PART X, LINE 12 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 SCHEDULE D, PART VII HAS BEEN LEFT BLANK. 0 X Other Information: Part IV: ALL GRANTS, SPONSORSHIPS AND DONATIONS ARE MADE TO NON-PROFIT AND CIVIC ORGANIZATIONS THAT ARE LOCATED IN THE COOPERATIVE'S SERVICE AREA. ALL DONATIONS ARE INTENDED TO IMPROVE THE COMMUNITIES IN WHICH OUR MEMBERS RESIDE. X 1 1 X X 0 0 0 GL HURSE 191063 0 1608 0 7610 0 29486 0 19410 0 249177 0 0 0 MICHAEL SARKIS 103643 0 3000 0 8123 0 48166 0 23248 0 186180 0 0 0 JOHN BENARD 98256 0 1500 0 10369 0 47585 0 20291 0 178001 0 0 0 MICHAEL FARIS 95633 0 1613 0 6551 0 57151 0 7922 0 168870 0 0 0 JANETTE FARIS 91870 0 1613 0 7418 0 64376 0 7602 0 172879 0 0 0 Supplemental Information Part III THE CONTRIBUTION RATE FOR PARTICIPANTS IN THE NRECA R&S DEFINED BENEFIT PENSION PLAN ARE THE SAME FOR ALL INDIVIDUALS IN THE 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. GARY HURSE DEFINED BENEFIT PLAN $ 23,568 401(k) EMPLOYER MATCH 5,918 TOTAL COLUMN C $ 29,486 MICHAEL SARKIS DEFINED BENEFIT PLAN $ 44,691 401(k) EMPLOYER MATCH 3,475 TOTAL COLUMN C $ 48,166 JOHN BENARD DEFINED BENEFIT PLAN $ 45,302 401(k) EMPLOYER MATCH 2,283 TOTAL COLUMN C $ 47,585 MICHAEL FARIS DEFINED BENEFIT PLAN $ 54,458 401(K) EMPLOYER MATCH 2,693 TOTAL COLUMN C $ 57,151 JANETTE FARIS DEFINED BENEFIT PLAN $ 61,540 401(K) EMPOYER MATCH 2,836 TOTAL COLUMN C $ 64,376 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. THE DISPOSAL OF A SUBSTANTIAL PORTION OF THE COOPERATIVE'S ASSETS; 2. THE DISSOLUTION/LIQUIDATION OF THE COOPERATIVE; 3. THE MERGER OR CONSOLIDATION OF THE COOPERATIVE WITH ANOTHER ORGANIZATION; AND 4. AMENDMENTS TO THE BY-LAWS. Form 990, Part VI, Section B, line 11 MANAGEMENT PRESENTED A COPY OF THE FORM 990 TO THE BOARD FOR DISCUSSION, REVIEW AND APPROVAL PRIOR TO FILING. THE DISCUSSION AND REVIEW WAS PERFORMED AT THE BOARD MEETING IMMEDIATELY BEFORE FILING THE FORM 990. Form 990, Part VI, Section B, line 15a THE BOARD OF DIRECTORS USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE GENERAL MANAGER. THE SURVEY SHOWS COMPARATIVE SALARIES FOR GENERAL MANAGERS FROM SIMILARLY SITUATED COOPERATIVES LOCATED IN NEW MEXICO AND THE NATION. Form 990, Part VI, Section C, line 19 THE COOPERATIVE PROVIDES 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. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: OTHER COMPREHENSIVE INCOME PROVISION FOR PENSIONS AND BENEIFTS 1,423,500. RETIREMENT OF PATRONAGE CAPITAL -1,147,466. NET CHANGE IN MEMBERSHIPS 185. UNREALIZED LOSS ON BOND -500,000. Total to Form 990, Part XI, Line 5: -223,781. AUDIT COMMITTEE Form 990, Part XII, Line 2C THE BOARD AS A WHOLE IS RESPONSIBLE FOR OVERSEEING THE AUDIT AND SOLICITING THE CPA WHO WILL PERFORM THE AUDIT. ACCOUNTING SYSTEM Form 990, Part IX THE ACCOUNTING RECORDS OF THE COOPERATIVE ARE MAINTAINED IN ACCORDANCE WITH THE UNIFORM SYSTEM OF ACCOUNTS AS PRESCRIBED BY THE FEDERAL ENERGY REGULATORY COMMISSION FOR CLASS A AND B ELECTRIC UTILITIES MODIFIED FOR ELECTRIC BORROWERS OF THE RURAL UTILITIES SERVICE(RUS). THE UNIFORM SYSTEM OF ACCOUNTING DOES NOT RECORD EXPENSES IN THE GENERAL EXPENSE CATEGORIES PROVIDED ON PART IX LINES 1 - 23. THE COOPERATIVE WILL BREAK OUT 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 WILL BE REPORTED ON LINE 24 UNDER THE EXPENSE CATEGORIES REQUIRED BY THE UNIFORM SYSTEM OF ACCOUNTS. PATRONAGE DIVIDENDS Form 990, Part VIII, Line 2B 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. RECONCILIATION OF WAGES PER RETURN TO FORM W-3 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. IN AN EFFORT TO EXPLAIN WHY THE AMOUNTS REPORTED ON LINES 5-7 DO NOT AGREE TO THE W-3 THE FOLLOWING RECONCILIATION IS PROVIDED. TOTAL PER LINES 5-7 $ 3,569,986 LESS DIRECTORS FEES REPORTED ON 1099-MISC (177,051) PLUS SALARIES AND WAGES ALLOCATED TO ASSET ACCOUNTS 1,635,767 LESS EMPLOYEE OFFICER BENEFITS INCLUDED IN LINE 5 (48,896) RECONCILIATION TO W-3 $ 4,979,806 BREAKDOWN OF EXPENSES INCLUDED IN ADMINISTRATIVE AND GENERAL Form 990, Part IX, Line 24 THE FOLLOWING IS A BREAKDOWN OF THE EXPENSES REPORTED AS ADMINISTRATIVE AND GENERAL EXPENSE ON FORM 990, PART IX, LINE 24 NETWORKING EXPENSE $ 214,376 OFFICE AND SUPPLIES 182,775 EQUIPMENT MAINTENANCE 48,525 OUTSIDE SERVICES 240,160 INJURY & DAMAGES 22,849 REGULATORY EXPENSE - NEW MEXICO 255,119 DUES ASSOCIATED ORGANIZATION 183,973 MAINTENANCE GENERAL PLANT 45,363 TOTAL ADMINISTRATIVE AND GENERAL EXPENSE PER 990 $1,193,140 TO PROVIDE DETAIL REGARDING OFFICER & HIGHLY COMPENSATED EMPLOYEE BENEFITS 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. AS PART OF THE PLAN DOCUMENT, THE COOPERATIVE PROVIES A MATCHING CONTRIBUTION UP TO 2% OF A PARTICIPATING EMPLOYEE'S SALARY. 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 EMPLOYEES, INCLUDING OFFICERS AND HIGHLY COMPENSATED EMPLOYEES, THROUGH A QUALIFIED PLAN. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR OFFICERS AND HIGHLY COMPENSATED EMPLOYEES ARE COMPRISED OF THE ACTUARIAL INCREASE IN THE DEFINED BENEFIT PLAN, THE EMPLOYER CONTRIBUTIONS TO THE 401(K) PENSION PLAN AND THE INSURANCE PAID ON BEHALF OF AND FOR BENEFIT OF SUCH EMPLOYEES. IN ADDITION TO THE ABOVE PENSION PLANS, THE COOPERATIVE ALSO PROVIDES POST-RETIREMENT HEALTH INSURANCE BENEFITS THROUGH A FUNDED WELFARE BENEFIT PLAN. THE VALUE OF THESE BENEFITS HAS NOT BEEN ESTIMATED. GENERAL MANAGER RESPONSIBILITIES Form 990, Part VII, Section A THE BOARD OF DIRECTORS CONSIDERS THE GENERAL MANAGER TO BE BOTH THE TOP MANAGEMENT OFFICIAL AND THE TOP FINANCIAL OFFICIAL. THEREFORE, ONLY THE GENERAL MANAGER IS LISTED AS AN EMPLOYEE OFFICER. TO PROVIDE DETAIL REGARDING OTHER EXPENSES Form 990, Part, IX, Line 24F THE FOLLOWING IS A BREAKDOWN OF THE EXPENSES REPORTED AS OTHER EXPENSES ON FORM 990, PART IX, LINE 24F. TAXES - PROPERTY & OTHER $ 39,370 TRANSMISSION EXPENSES 415,041 SALES EXPENSES 54,876 TOTAL OTHER EXPENSES PER FORM 990 LINE 24F $ 509,287 LCEC GENERATION LLC PO BOX 1447 LOVINGTON TX 882601447 ELECTRICITY GENERATION NM 0 6410446 LEA COUNTY ELECTRIC COOPERATIVE INC LEA COUNTY ELECTRIC EDUCATION FOUNDATION PO BOX 1447 LOVINGTON NM 88260 850351147 TO PROVIDE COLLEGE SCHOLARSHIPS TO MEMBERS OF THE COOPERATIVE. NM 501(C)(3) PF N/A 0 ENERGY RESEARCH AND DEVELOPMENT INC PO BOX 1447 LOVINGTON NM 88260 850228936 REAL ESTATE NM N/A C 28612 1.00000 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 LEA COUNTY ELECTRIC EDUCATION FOUNDATION N 0 N/A