2014-05-06T08:28:29-05:00 2013-12-31 450250958 EIDE BAILLY LLP 4310 17TH AVE S PO BOX 2545 FARGO ND 581082545 990 2013-01-01 450115790 Cass County Electric Cooperative Inc CASS 7013564400 3312 42nd Street S No 200 Fargo ND 58104 Chad Sapa CFO 7013564400 2014-04-28 1 LISA CHAFFEE CPA P00193453 7012398500 2014-04-28 2013 2015-11-30 17:44:51Z Chad Sapa 3312 42nd Street S No 200 Fargo ND 58104 107972472 0 X www.kwh.com X 1937 ND Meet our members' needs with excellent service consisting of reliable and affordable energy 9 8 117 0 57361 0 0 0 100404820 106837329 449239 523409 69294 180129 100923353 107540867 79710 80369 6422105 8986514 9700714 9854532 0 0 0 84107470 90798643 100309999 109720058 613354 -2179191 197572662 216592517 124431936 137415247 73140726 79177270 X The mission of Cass County Electric Cooperative is to meet our members' energy needs with excellent service consisting of reliable and affordable electricity while upholding our core values of integrity, innovation, accountability and commitment to community. 1 0 Sale of electric energy to 39,897 accounts at year end 2013. 0 0 0 0 0 0 0 1 0 1 0 0 0 1 1 0 1 0 0 0 0 0 0 0 0 0 1 0 1 0 1 0 0 0 0 0 0 0 0 0 1 1 1 0 1 133 0 1 117 1 1 1 0 0 0 0 108737809 1467100 0 X 9 8 1 0 0 0 1 1 1 1 0 0 0 1 1 1 1 1 1 1 0 0 X Chad Sapa 7013564400 3312 42nd St S Ste 200 Fargo ND 58104 Wendy Loucks Chairman 8.70 0.10 X X 12202 0 0 Russell Berg Vice Chairman 5.40 0.10 X X 13002 0 0 John Froelich Secretary 4.80 0.10 X X 11499 0 0 Sid Berg Treasurer 8.10 0.10 X X 10752 0 0 Douglas Anderson Director 3.50 0.10 X 9002 0 0 Steve Swiontek Director 2.90 0.10 X 9752 0 0 Glenn Mitzel Director (Apr-Dec) 5.60 0.10 X 7499 0 0 Robert Huether Director (Jan-Apr) 10.90 0.10 X 2501 0 0 Jeffrey Triebold Director 4.10 0.10 X 10002 0 0 Marcy Svenningsen Director 6.20 0.10 X 13002 0 0 Scott Handy CEO 42.30 X 226690 0 31801 Chad Sapa CFO 44.60 X 200077 0 90722 Tim Sanden CIO/VP Info Tech 43.10 X 162197 0 103796 Marshal Albright VP of Member & Energy Svcs 42.50 X 139674 0 123807 Bradley Schmidt VP Engineering & Operation 42.40 X 170406 0 34198 Todd Bollinger Customer Accounting 40.80 X 100652 0 21557 1098909 0 405881 6 0 1 0 MPM Construction PO Box 202 Horace ND 58047 Electrical Contractor 1256034 Jerry's Excavating PO Box 809 Casselton ND 58012 Electrical Contractor 860476 Carr's Tree Service PO Box 250 Ottertail MN 56571 Tree Clearing 354813 Moritz Excavating 1114 10th St SW Valley City ND 58072 Electrical Contractor 340636 Martin Engineering 20997 Co Hwy 20 Pelican Rapids MN 56572 Electrical Contractor 273026 7 Sale of Electricity 221000 106380033 106380033 Capital Credits 221000 457296 457296 106837329 494138 494138 467995 315073 152922 152922 57361 95561 29271 0 29271 29271 29271 143739 116532 27207 27207 107540867 106864536 57361 618970 X 80369 8986514 903649 7077771 1306859 566253 4566418 5757438 Cost of Power 77996735 Distribution 5765923 Administrative and Gene 2984047 Customer Service & Sale 2657619 -8929537 109720058 8452111 12994461 10934917 12012176 1657 1695 2105899 1987414 2736443 6707688 218286046 51891555 158207149 166394491 6513681 5575320 1412973 437991 7137717 7405856 70115 3075425 197572662 216592517 12968443 14219892 208960 194192 12730 13487 107481277 115857488 3760526 7130188 124431936 137415247 X 0 0 8831426 12455825 64309300 66721445 73140726 79177270 197572662 216592517 X -2179191 64512 8151223 X 0 1 X 1 0 0 1 X 610710 610710 15596317 4528952 11067365 196611287 47362603 149248684 5467732 5467732 166394491 Customer Deposits 921653 Other Liabilities 3810239 Installation Costs of Equip 260032 Postretirement Benefits 1736865 Pension Restoration Plan 401399 7130188 X 107630397 64512 25018 89530 107540867 0 107540867 100733544 0 100733544 8986514 8986514 109720058 Part IV, Line 2b: The members of the Cooperative can elect to round up their monthly electric bill to the next dollar. These funds collected from the membership are held in a Cooperative account until they are released to the SERVE Foundation. These funds are transferred directly to the SERVE Foundation on a monthly basis. Funds that exist at the end of year are a result of a timing difference in the receipt of the funds and the release of them to the SERVE Foundation. For the year ended December 31, 2013 the account held $13,487. Part X, Line 2: The Cooperative is exempt from income taxes. The Cooperative has adopted the provisions of Accounting and Standards Codification (ASC) 740-10. As of December 31, 2013, the unrecognized tax benefit accrual was zero. The Cooperative will recognize future accrued interest and penalties related to unrecognized tax benefits in income tax expense if such penalties and interest are incurred. Under normal circumstances, the Cooperative is no longer subject to Federal tax examinations by tax authorities for years before 2010 and state examinations for years before 2010. The Cooperative undergoes an annual analysis of various tax positions, assessing the likelihood of those positions being upheld upon examination with relevant tax authorities, as defined by ASC 740-10. Part XI, Line 2d - Other Adjustments: Equity Earnings from SERVE Co. 25,018. Part XII, Line 4b - Other Adjustments: Patronage Capital Credits Allocated During Current Year 8,986,514. 1 ND Chapter of Dollars for Scholars PO Box 5509 Bismarck ND 58501 371517987 501(c)(3) 8000 Education Greater Fargo-Moorhead Economic Development Corporation 51 Broadway Suite 500 Fargo ND 58102 456011769 501(c)(3) 50000 Local Economic Growth State Historical Society of ND 612 E Boulevard Bismarck ND 58505 237305181 501(c)(3) 5375 Heritage Center Expansion 3 0 Part I, Line 2: The organization receives notification from ND Dollars for Scholars of the scholarship recipients. The organization is a member in the Greater Fargo-Moorhead Economic Development Corporation. They receive reports as to how the grant money is spent by the GFMEDC and the State Historical Society of North Dakota. X X X X 0 0 0 Scott Handy CEO 213323 0 2194 0 11173 0 15085 0 16716 0 258491 0 0 0 Chad Sapa CFO 159958 0 22547 0 17572 0 72563 0 18173 0 290813 0 0 0 Tim Sanden CIO/VP Info Tech 131571 0 18018 0 12608 0 86768 0 17051 0 266016 0 0 0 Marshal Albright VP of Member & Energy Svcs 113933 0 15256 0 10485 0 109278 0 14744 0 263696 0 0 0 Bradley Schmidt VP Engineering & Operation 147493 0 18669 0 4244 0 16669 0 17529 0 204604 0 0 0 Schedule J, Part II, Column C, Deferred Compensation Included in other compensation is the estimated current year increase in the actuarial value of the defined benefit plan. These amounts do not represent any current year contributions to the plan. They are estimates of the increase in the actuarial value of the plans received from the NRECA. The current year expense and the increase in actuarial value for each employee are reflected in the statement for Form 990, Part VII, Column f. Scott Handy Computer Loan X 613 127 0 1 1 Sid Berg Computer Loan X 1135 485 0 1 1 Tim Sanden Exercise Equipment Loan X 2000 1083 0 1 1 1695 Form 990, Part III, line 2 Our newly installed Meter Data Management System (MDMS) includes fully integrated customer self-service options through a new e-bill platform called "Smart Hub" that enables end users to view hourly and daily consumption information on their personal electricity usage, helping them understand their consumption patterns. This secure information can be accessed by the web, smart phone or tablet (iPad). Smart Hub was made available to our members in March 2013. Form 990, Part VI, Section A, line 2 All board members have a business relationship as they all serve on the board of a related organization which is taxable as a corporation. Form 990, Part VI, Section A, line 6 CCEC has one class of members. A person is eligible to become a member of the cooperative effective the date the person initially uses or requests to use electric service and meets the requirements set forth in Article I of the Cooperative's Bylaws. Form 990, Part VI, Section A, line 7a One member, one vote. CCEC members have the right and authority to elect the Board of Directors. Three directors stand for election each year at the annual business meeting. Members also have the right to request a special meeting of the membership when the request is based on valid member demand. Members may consider, vote or act upon other matters as provided by applicable laws. Form 990, Part VI, Section A, line 7b CCEC membership has the right and authority to have the final decision role on the following matters: **The disposition of cooperative assets if the proposed sale is over 5% of total assets during a 12-month period. No less than two-thirds of the entire membership must approve the proposed transfer. **A proposed merger or consolidation; a majority of the members present and voting in person at the member meeting must approve the consolidation or merger. Form 990, Part VI, Section A, line 8b The Board of Directors is the sole body with governing authority over the Cooperative. All committees serve in an advisory capacity. Appropriate records are maintained of proceedings at all governance meetings as well as its advisory standing committees. Form 990, Part VI, Section B, line 11 Board policy 202 - Tax Status/Reporting establishes that: following the initial preparation of the draft Form 990, the CFO and President/CEO must review the report and submit it to the Board of Directors for approval. The Board must approve the completed Form 990 before it is filed. Form 990, Part VI, Section B, line 12c CCEC Policy 110 - Conflict of Interest - requires Directors and employees of the Cooperative to disclose annually: **The receipt of any gifts, fees, loans or favors with a value in excess of $100 **Any business transaction that may be considered in competition with the cooperative or deemed a conflict of interest **The policy also prohibits the use of non-public corporate information for financial or business opportunity benefit. ***Action: Should a conflict be disclosed the board must provide the director an opportunity to comment orally and in writing regarding the information or fact before making a determination. If the board determines that a director is not in compliance with the policy the board will act appropriately including the possibility of sanction, disqualification and/or removal. Legal counsel reviews disclosures. Individuals with a conflict must abstain from voting. Form 990, Part VI, Section B, line 15a At the board reorganization meeting held annually, the board reviews director compensation and benefits. The next review of director compensation will be done in April 2014. The most current NRECA Director Compensation Survey is provided for review. Note: this survey is done every other year (most current 2011) and was provided to the board in April 2013. A new survey will be conducted in 2015. A CEO evaluation of compensation is done annually by the Board of Directors during an executive session; the CEO is not present during the meeting. As established by Board Policy 105.4, the Board Compensation Committee collects, verifies and analyzes comparative data on compensation which is then provided and reviewed by the board (executive session minutes are kept by legal counsel). The board Chairman is responsible for discussing the outcome of the evaluation with the CEO. The last CEO evaluation occurred in November 2013. An annual performance appraisal is required for all employees; the appraisals on top management personnel are completed by the President/CEO in accordance with Board Policy 224. Local, regional and national wage and salary data is used to determine the wage scale, which is approved annually by the Board of Directors. Form 990, Part VI, Section C, line 19 The Cooperative's Bylaws and Articles of Incorporation are posted on the website (www.kwh.com). A paper copy is made available to any member upon request. The financial statements are mailed to all members of the Cooperative in the annual report issue of Cooperative's official newsletter, The Highline Notes. The Conflict of Interest Policy is available to the public upon request. Form 990, Part IX, Functional Expense, Line 24e Other Expenses- The salaries, pension, and payroll taxes reported on lines 5-10 are already included in distribution expense, administrative & general expense and customer expense. Therefore, these amounts are being subtracted out as an other deduction on line 24e in the amount of $(9,854,531). Form 990, Part IX, Functional Expense, Line 4 Benefits Paid to Members- The Cooperative has interpreted the instructions to Part IX, Line 4, to mean patronage capital allocated for the year, rather than patronage capital retired. This is consistent with the Bylaws of the Cooperative. Form 990, Part XI, line 9: Retired Capital Credits to Patrons -860,309. Equity Earning From SERVE Co. 25,018. Patronage Capital Credits Allocated During Current Year 8,986,514. Form 990, Part VII, Column F Estimated Amount of Other Compensation - Included in deferred compensation is the current year estimated increase in the actuarial value of the defined benefit plan for the following employees: Chad Sapa $59,769, Marshal Albright $97,229, Tim Sanden $75,992. These amounts are estimates in the increase of the value of the plan and are not current year expenses of the Cooperative. The current year expense for this defined benefit plan are as follows: Scott Handy $51,717, Chad Sapa $39,658, Marshal Albright $28,277, Tim Sanden $33,502. Because Part IX, line 5 captures only the current year expense of the defined benefit plan of the Cooperative, the compensation in Part IX, line 5 is less than that reported in Part VII. Southeast Rural Vision Enterprises Co 3312 42nd St S Ste 200 Fargo ND 581048608 450436356 Merchandise Sales, Generator Leasing ND Cass County Electric Cooperative Inc C 743854 309195 1.00000 1 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 Southeast Rural Vision Enterprises Co F 1000000 Actual Distribution