Big Sandy Rural Electric Cooperative Corporation

“Line 6 explanation - must be a member to receive electric service. Each member has 1 vote. May have more than 1 service per membership.”

“Line 7a explanation - nominating committee meets every year to select a member to run for director. Member may run for director with petition signed by 75 or more eligible members.”

“Line 7b explanation - articles of incorporation can only be changed by a majority of membership. Bylaws may be altered, amended, or repealed by the board of directors at any regular or special board meeting, provided, that the notice of the meeting, shall have contained a copy of the proposed alteration, amendment, or repeal.”

“Line 11b explanation - directors are furnished a draft copy of the 990 prior to filing. May make inquiries of, and changes to, information contained in the filing. Additionally, directors meet with the independent auditor and are able to ask questions at that time.”

“Directors and key employees annually complete questionnaire on family and business relationships.”

“15a & b. Board of directors review and approve compensation of key employees and other non-union employees using data provided by state and national organization surveys of electric cooperatives. 15b. Remaining employees compensation is negotiated through a union contract.”

“A copy of the bylaws and a statement of nondiscrimination are given to each new member. Bylaws and financial statements are published annually in newsletter mailed to each member. An annual membership meeting is held with all members invited to attend.”

“Accumulated comprehensive income 13,035. Margins allocated to members -1,020,992. Memberships issued, net 150. Other equities 17,586. Refunds of capital credits -63,227.”

“The organization did not change its oversight process during the tax year.”

“Benefits paid to or for members represents patronage capital allocated to members in accordance with the bylaws of the cooperative. This reporting results in a difference between book income and income reported on the form 990 by the same amount.”