2011-11-09T15:20:31-06:00 2010-12-31 BOLINGER SEGARS GILBERT AND MOSS LLP 8215 NASHVILLE AVENUE LUBBOCK TX 79423 990 2010-01-01 750696759 SOUTHWEST TEXAS ELECTRIC COOPERATIVE INC SOUT 3258532544 PO BOX 677 ELDORADO TX 769360677 WILLIAM W WHITTEN 3258532544 2011-11-04 1 Matt R Willis 8067473806 2011-11-04 2010 2016-02-24 21:20:13Z WILLIAM W WHITTEN PO BOX 677 ELDORADO TX 769360677 20963063 0 X WWW.SWTEC.COM X 1941 TX TO PROVIDE QUALITY AND RELIABLE ELECTRIC SERVICE TO MEMBERS OF THE COOPERATIVE. 7 7 50 0 10249 9249 0 0 18686831 20613016 46554 28783 173323 34653 18906708 20676452 0 6827 0 0 1907531 2077268 0 0 0 13449677 16023993 15357208 18108088 3549500 2568364 36666733 41074574 7662605 9501952 29004128 31572622 TO MAKE ELECTRIC ENERGY AVAILABLE TO ITS MEMBERS AT THE LOWEST COST CONSISTENT WITH SOUND ECONOMY AND GOOD MANAGEMENT. 0 0 PROVIDING ELECTRIC ENERGY TO OUR MEMBERS - 9,215 ACTIVE SERVICES AT YEAR END WERE PROVIDED ELECTRICITY ON A COOPERATIVE BASIS THROUGH THE ALLOCATION OF PATRONAGE CAPITAL. 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 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 15 0 50 1 1 1 0 0 0 0 20819888 264610 0 X 7 7 0 0 0 0 1 1 1 1 0 0 0 1 1 1 1 1 1 1 1 0 X WILLIAM WHITTEN 3258532544 101 E GILLIS ELDORADO TX 76936 STEVE WILLIAMS 4.60 X X 21143 0 0 RICHARD S RUNGE 2.50 X X 18873 0 0 JERRY JOHNSON 2.00 X X 18798 0 0 JAMES OWENS 2.30 X X 18818 0 0 BILLY GREEN 2.20 X 9435 0 0 SAM HENDERSON JR 1.70 X 9261 0 0 EUGENE VINSON 2.60 X 18818 0 0 WILLIAM WHITTEN 45.00 X 104360 0 27315 219506 0 27315 1 0 0 0 SUTTON SPECIALTY ELECTRIC 1941 N MAIN JUNCTION TX 76849 POWERLINE CONSTRUCTION 780289 LAMBDA CONSTRUCTION 211 JESSES CIRCLE NEW BRAUNFELS TX 78132 SUBSTATION CONSTRUCTION 381906 SCHNEIDER ENGINEERING LTD 191 MENGER SPRINGS PKWY BOERNE TX 78006 SYSTEM ENGINEERING 155856 3 ELECTRIC SALES 221000 19819521 19819521 PATRONAGE DIVIDENDS 221000 793495 793495 20613016 28783 28783 17412 17412 17412 15720 1692 303852 286611 17241 6992 10249 20676452 20635728 10249 30475 6827 246821 989584 209762 547121 83980 145918 1410377 PURCHASED POWER 12260233 DISTRIBUTION EXPENSE 1213338 ADMIN.& GENERAL 766030 CUSTOMER ACCOUNTS 218238 UBIT 3414 6445 18108088 410595 855256 1400716 1544092 467536 712827 825973 709293 57610483 28634307 26101609 28976176 6614254 7249268 846050 1027662 36666733 41074574 1095031 1725587 879840 741252 5230450 6575676 457284 459437 7662605 9501952 X 9960 10090 0 0 28994168 31562532 29004128 31572622 36666733 41074574 X 2568364 130 X X 0 1 0 X 0 292772 292772 712692 573893 138799 53504960 28060414 25444546 3100059 3100059 28976176 CAPITAL TERM CERTIFICATES 508031 C PATRONAGE CAPITAL - NATIONAL RURAL UTILITIES FINANCE CORP 210071 C PATRONAGE CAPITAL - TEXAS ELECTRIC COOPERATIVE, INC 194811 C PATRONAGE CAPITAL - GOLDEN SPREAD ELECTRIC COOPERATIVE, INC. 6241390 C PATRONAGE CAPITAL - OTHERS 94965 C 7249268 CONSUMER DEPOSITS 100839 ACCRUED TAXES 114046 ACCRUED INTEREST 20000 OTHER CURRENT AND ACCRUED LIABILITIES 224552 459437 20676452 18108088 2568364 130 130 2568494 20676390 0 20676390 62 62 20676452 18108026 0 18108026 62 62 18108088 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 XI, Line 8 - Other Adjustments: NET INCREASE IN MEMBERSHIPS 130. Part XII, Line 4b - Other Adjustments: EXPENSES RECORDED IN NON-OPERATING MARGINS RECLASSED TO EXPENSES 62. Part XIII, Line 4b - Other Adjustments: EXPENSES RECORDED IN NON-OPERATING MARGINS RECLASSED TO EXPENSES 62. 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 SCHEDULE D, PART IX 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. 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. Form 990, Part VI, Section A, line 8b EXECUTIVE SESSION FROM TIME TO TIME THE ENTIRE BOARD WILL GO INTO EXECUTIVE SESSION FOR DISCUSSING ITEMS OF A SENSITIVE AND CONFIDENTIAL NATURE. WHEN THIS OCCURS MANAGEMENT AND OTHERS IN ATTENDANCE ARE REMOVED FROM THE MEETING ROOM. ITEMS DISCUSSED IN EXECUTIVE SESSION ARE NOT DOCUMENTED. HOWEVER, ACTIONS TAKEN BY THE BOARD AFTER EXECUTIVE SESSIONS ARE ADJOURNED ARE FULLY DOCUMENTED IN THE WRITTEN MINUTES. 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 12c COOPERATIVE'S LEGAL COUNSEL MUST ANNUALLY REVIEW THE CONFLICT OF INTEREST POLICY WITH ALL OFFICERS AND DIRECTORS. EACH OFFICER AND DIRECTOR MUST ANNUALLY COMPLETE AND SIGN THE CONFLICT OF INTEREST CERTIFICATION AND DISCLOSURE FORM, WHICH IS ATTACHED TO THE CONFLICT OF INTEREST POLICY. Form 990, Part VI, Section B, line 15 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 COOPERATIVES LOCATED IN TEXAS AND THE NATION. THE BOARD AND THE GENERAL MANAGER USE A COMPENSATION SURVEY WHEN DETERMINING THE COMPENSATION OF THE ORGANIZATION'S OTHER OFFICERS OR KEY EMPLOYEES, IF ANY. THE SURVEY INCLUDES SALARIES FROM SIMILAR COOPERATIVES THROUGHOUT TEXAS AND THE NATION. Form 990, Part VI, Section C, line 19 THE COOPERATIVE PROVIDES ANNUALLY A COPY OF THE AUDITED BALANCE SHEET AND INCOME STATEMENT TO THE MEMBERS OF THE COOPERATIVE AT THE ANNUAL MEETING. THE COOPERATIVE WILL PROVIDE A COMPLETE COPY OF THE AUDITED FINANCIAL STATEMENTS TO ANY MEMBER WHO REQUESTS A COPY. BYLAWS ARE MAILED TO ALL MEMBERS AND THE COOPERATIVE'S CONFLICT OF INTEREST POLICY IS AVAILABLE UPON REQUEST. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: NET INCREASE IN MEMBERSHIPS 130. Total to Form 990, Part XI, Line 5: 130. AUDIT COMMITTEE Form 990, Part XII, Line 2C THE BOARD AS A WHOLE IS RESPONSIBLE FOR OVERSEEING THE AUDIT AND SELECTING THE CPA WHO WILL PERFORM THE AUDIT. 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 OFFICER'S OTHER COMPENSATION 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 PROVIDES 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, MEETING THE ELIGIBILITY REQUIREMENTS OF SUCH PLANS. THE COOPERATIVE ALSO PROVIDES HEALTH AND LIFE INSURANCE TO ALL EMPLOYEES, INCLUDING OFFICERS, THROUGH A QUALIFIED PLAN. EMPLOYEES INCLUDING OFFICERS ARE REQUIRED TO PAY FOR PART OF THE INSURANCE THROUGH PAYROLL DEFERRALS. THE AMOUNTS REPORTED ON PART VII, COLUMN (F) FOR THE OFFICER IS COMPRISED OF THE ACTUARIAL INCREASE IN THE DEFINED BENEFIT PLAN FOR THE OFFICER, THE TOTAL AMOUNT CONTRIBUTED TO THE 401(K) PENSION PLAN AND THE INSURANCE PREMIUMS PAID FOR THE BENEFIT OF THE OFFICER. PATRONAGE DIVIDENDS Form 990, Part VIII, Line 2B PATRONAGE DIVIDENDS RESULT FROM THE PURCHASE OF WHOLESALE POWER FROM A GENERATION & TRANSMISSION COOPERATIVE. PATRONAGE DIVIDENDS ALSO 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. 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. 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. 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 $1,236,405 LESS DIRECTORS FEES REPORTED ON 1099-MISC (115,146) PLUS SALARIES AND WAGES ALLOCATED TO ASSET ACCOUNTS 832,637 LESS EMPLOYEE OFFICER BENEFITS REPORTED ON LINE 5 (27,315) RECONCILIATION TO W-3 $1,926,581 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. OFFICE SUPPLIES AND EXPENSE $113,390 OUTSIDE SERVICES EMPLOYED 165,206 INSURANCE 26,903 EMPLOYEE EDUCATION AND TRAINING 44,020 MAINTENANCE OF GENERAL PLANT 40,468 REGULATORY COMMISSION EXPENSE 42,441 MISCELLANEOUS GENERAL EXPENSE 333,602 TOTAL ADMINISTRATIVE AND GENERAL EXPENSE PER 990 $766,030 GOVERNING BODY AND MANAGEMENT Form 990, Part VI, Section A, Line 1 THE COOPERATIVE HAS 7 BOARD MEMBERS; ALL 7 ARE ALLOWED TO VOTE, HOWEVER THE BOARD PRESIDENT VOTES ONLY IN THE CASE OF A TIE.