Natchez Trace Electric Power Association

“The cooperative has 9 board members; all 9 are allowed to vote, however the board president votes only in the case of a tie.”

“The cooperative was formed by the members to provide electric service at cost on a cooperative basis.”

“Directors serve a three year term. Each year three directors are elected by the members of the association.”

“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. Disposal of a substantial portion of the cooperative's assets 4. Amendment to the articles of incorporation 5. Amendment to the bylaws”

“Management presented a copy of the form 990 to the board for discussion and review prior to filing.”

“On an annual basis, the cooperative will require the board of directors and officers to disclose any action or situation that might violate the policy and cause conflict of interest.”

“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 throughout the nation. Internal and/or external resources are also used to compare annual compensation within the industry. The board and the general manager use a compensation survey when determining the compensation of the cooperative's other employees meeting the definition of officer. The survey includes salaries from similarly situated cooperatives throughout the nation.”

“The cooperative will provide a complete copy of its governing documents, conflict of interest policy, and audited financial statements to any member who requests a copy of any such document. The bylaws can also be found on the cooperative's website.”

“In order to provide retirement benefits to its employees, the company has established a defined contribution plan and defined benefit plan for the respected groups of employees. Employer contributions to the plan are made pursuant to the plan document. The company also provides health, dental and life insurance to all eligible employees through a qualified plan. The amounts reported on part vii, column (f) for the officers and highly compensated employees is comprised of actuarial increase in the defined benefit plan, the total amount contributed by the company to the defined contribution plan and insurance paid on behalf of and for their benefit.”

“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.”

“The accounting records of the association are maintained in accordance with the uniform system of accounts (usoa) as prescribed by the federal energy regulatory commission for class a and b electric utilities. The usoa does not record expenses in the general expense categories provided on part ix lines 1-23. The cooperative separately reports 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 are reported on line 24 under the expense categories required by the usoa. On the 2023 form 990, part i, line 15, the cooperative separately stated salaries and wages, employee benefits, and payroll taxes that are allocated in accordance with their accounting system. On the 2022 return, the cooperative did not separately state these expenses. The 2022 return is complete and accurate, but the cooperative believes by separately stating these expenses on the 2023 return a reader of the form 990 will be more informed. Future years returns filed by the cooperative will separately state salaries and wages, employee benefits, and payroll taxes, making the comparison on page 1 more meaningful.”

“Salaries and wages are allocated to asset, liability, and expense accounts based on the accounting system described above. The following schedule reconciles amounts reported on lines 5-7 to total wages accrued and/or paid: total per lines 5-7 $ 3,610,975 less: director fees reported on forms 1099-nec (100,575) less: employee officer benefits included in line 5 (73,401) plus: salaries and wages allocated to nonoperating margins 2,814 plus: salaries and wages capitalized directly to plant 1,566,761 plus: salaries and wages capitalized/expensed indirectly through clearing and other accounts 297,302 total wages accrued and/or paid $ 5,303,876”

“Administrative & general expense is comprised of the following: administrative & general salaries, benefits & other $ 430,051 office supplies 292,312 outside services 42,539 insurances and damages 333,904 regulatory commission 800 miscellaneous general 155,581 property insurance 13,380 duplicate charges (32,235) directors 70,506 total admin & general exp per financial statements $ 1,307,738 less: reclass of director fees to part ix, line 5 (100,575) less: reclass of labor to part ix, lines 5 & 7 (701,672) less: reclass of benefits to part ix, lines 8-10 (347,855) total admin & general expense per form 990, part ix $ 157,636”

“Other expenses is comprised of the following: consumer expenses $ 54,940 merchandising expenses 6,071 sales and other expenses 19,885 total other expenses per form 990, part ix $ 80,896”

“Net change in memberships -3,771. Equity in undistributed earnings of nt spark 2,138,002.”