South Mississippi Electric Power

“The board of directors of cooperative energy consists of 2 directors from each of the 11 member nonprofit distribution cooperatives that own cooperative energy, plus 2 at large directors who also serve on the board of directors of the member cooperative for a total of 24 directors. Eleven directors serving on cooperative energy's board of directors are general manager of the member cooperative. Thus the general manager and director from each member cooperative have a business relationship with each other while serving as directors for cooperative energy.”

“See response to part vi section a question 2 above.”

“See response to part vi section a question 2 above.”

“See response to part vi section a question 2 above.”

“A copy of the 2022 form 990 was reviewed with the budget and finance committee and reported to the board of directors. On the budget and finance committee's recommendation, the board authorized the execution and filing of the return.”

“Conflict of interest policy enforcement - directors, officers, and key employees annually complete and sign a questionnaire relative to independence, business relationships, etc. Directors shall avoid actual or apparent conflicts between personal interests and official responsibilities on behalf of cooperative energy. A conflict occurs when a director or family member has private interests that interfere with the director's responsibility to act objectively and effectively in the best interest of cooperative energy. Any director who becomes aware that the conduct of others violates this code is obligated to report the violation to the general counsel.”

“Cooperative energy uses a variety of data sources to inform management and the board of directors of compensation market data and trends to ensure cooperative energy's wages are competitive, fair, and equitable. In 2022, cooperative energy participated in several compensation surveys to gain comparability data regarding compensation practices. Salaried plan ranges are aligned with market data by an external compensation consultant every two years. The survey data analysis and position valuation ranges were used in the evaluation of salaries for the ceo and executive management team. The executive management team's salaries were determined by the ceo and approved by the budget and finance committee and the board of directors. The process was documented contemporaneously. The ceo's salary was established by the board of directors.”

“Receptionists have been informed that the form 990 will be made available. Financial statements are available on the organization's website.”

“Excess of revenues over expenses, or net margin of $20,000,000, is allocated to the 11 member cooperatives based on sales. This is only an allocation of patronage capital. No actual payment is made to the members. This allocation of patronage capital is shown as a functional expense in part ix, number 4, per form 990 instructions effective for 2022 reporting. Cooperative energy does not include this allocation of patronage capital as an expense for financial reporting. During 2022 patronage capital amounting to $10,000,000 was retired.”

“There were no changes in the process for the 2022 tax year.”