Linn County Rural Electric Cooperative

“All electric customers of the cooperative are voting members. Each member is entitled to one vote.”

“Members elect the board of directors. There is one class of membership.”

“Members vote on changes to the articles of incorporation.”

“The cooperative does not have committees; therefore, committee meetings are not documented.”

“The gm/ceo and controller review the full form 990 after it is compiled by the staff and audit firm. The board reviews the 990 at a regular board meeting. Any suggested changes or additions are reviewed and forwarded to the auditors prior to filing with the irs.”

“The board reviews the conflict of interest policy on an annual basis with general counsel guidance. Following the review the board completes a conflict of interest disclosure statement. It is the gm/ceo's responsibility to provide assistance to the board to assure compliance with this policy and to develop and enforce appropriate management policy relating to conflicts of interest of employees. Directors and employees are required to make full disclosure to the board and/or cooperative of any facts which may indicate a conflict of interest. They shall disqualify themselves from decisions which pose a conflict of interest or the appearance of a conflict of interest. They may request an opinion of the cooperative's general counsel before such action is taken.”

“The ceo's salary and the compensation of the board of directors is set by the board on an annual basis based upon local, regional and national compensation data. A compensation consultant is used approximately every three to five years. This compensation consultant was last utilized in 2022. There will be a compensation study by a consultant in 2025. The consultant updates pay grades/ranges on an annual basis. Documentation of the annual compensation determination is located in the personnel file. It is also located in the gm/ceo's contract. The management staff salary is set on an annual basis by ceo using local, regional and national compensation data. A compensation study with periodic updates is further used for other officers and staff within the organization. Documentation of the annual compensation determination is located in the personnel file.”

“Articles and bylaws are provided to members upon receiving service or upon a later request. Conflict of interest policy upon request. Financial statements in an annual report mailed to members upon request.”

“The irs instructions state that patronage dividends paid by section 501(c)(12) organizations to their members should be reported on line 4. The organization has interpreted patronage dividends paid to mean patronage dividends allocated or to be allocated for the current year. Since this allocation is not an expense under generally accepted accounting principles (gaap), this has resulted in a reconciling item to net assets in part xi on page 12 of the form 990.”

“Capital credits retired -1,007,148. Equity in earnings of subsidiary 71,316. Patronage dividends paid 3,500,000.”