Cooperative

Guest Post: A Guide to Surety Bonds in the Energy and Utility Sectors

by David R. Cook Jr.
November 10, 2012

This guest post was provided by Danielle Rodabaugh, chief editor of the Surety Bond Insider.

In most cases, surety bond insurance is used to protect consumers from companies that could harm them by committing fraud or failing to follow industry regulations. In some situations, however, bonds can be used to protect a business itself. Such is the case with utility bonds used within the energy and utility sector.Read More »Guest Post: A Guide to Surety Bonds in the Energy and Utility Sectors

Updated Capital Credits Litigation Summary

by David R. Cook Jr.
October 14, 2012

AHC attorneys have been closely following lawsuits against cooperatives’ capital credit management. We recently developed an updated summary of the cases. Take a moment to review the summary by clicking here.Read More »Updated Capital Credits Litigation Summary

Electric Coop vs. Power Supplier: Feuding PPA Parties Illustrate “Real Life” Disputes Involving Common PPA Provisions

by David R. Cook Jr.
September 28, 2012

A 2008 case and its follow-up in 2011 addressed several issues arising from common provisions in power purchase agreements. These issues involve spinning reserve requirements, dispatch rights, and the applicable heat rate formula. The underlying dispute emphasizes the need to clearly address the parties’ bargain in the power purchase agreement (PPA), preferably with the input of the parties’ legal counsel.Read More »Electric Coop vs. Power Supplier: Feuding PPA Parties Illustrate “Real Life” Disputes Involving Common PPA Provisions

State of Renewable Energy Financing for Coops

by David R. Cook Jr.
September 24, 2012

This post is a repost from CFC’s Solutions News Bulletin, Sept. 24, 2012, Vol. 14, No. 36.

At the September board meeting of the National Renewables Cooperative Organization (NRCO), John List, CFC senior vice president, Member Services, discussed the funding behind current and future renewable energy projects. The regularly scheduled meeting was hosted by Indianapolis, Ind.-based Wabash Valley Power.Read More »State of Renewable Energy Financing for Coops

IRS Applies Related-Party Restrictions to Coop’s Patronage-Dividend Deductions

by David R. Cook Jr.
September 10, 2012

In a July 2012 Chief Counsel Advisory (CCA), the Service considered whether cooperatives and their patrons are subject to the related-party rules under Section 267.… Read More »IRS Applies Related-Party Restrictions to Coop’s Patronage-Dividend Deductions

AHC Attorney Discusses Cooperative Governance and Transparency Issues

by Roland F. Hall
August 19, 2012February 15, 2022

AHC attorney Roland Hall was recently interviewed for an article on the trend toward more transparency and openness in cooperative governance. The article appeared in the July/August issue of the National Cooperative Business Association’s Cooperative Business Journal. Read More »AHC Attorney Discusses Cooperative Governance and Transparency Issues

CFTC Proposes Exemption for “Cooperatively-Owned Utilities”

by David R. Cook Jr.
August 18, 2012

On Friday, August 17, 2012, the U.S. Commodity Futures Trading Commission (CFTC) approved a proposed order that would exempt certain transactions by electric cooperatives, among other “Exempt Entities,” from many of the requirements of the Commodity Exchange Act.Read More »CFTC Proposes Exemption for “Cooperatively-Owned Utilities”

Cooperative Litigation Update: N.C. Court Rules on Coop’s Discounting Program

by David R. Cook Jr.
August 11, 2012February 15, 2022

In another lawsuit concerning cooperatives’ capital credit practices, a North Carolina trial court ruled in favor of a cooperative that we previously wrote about in another blog post.

The court ruled, based on the facts at issue, that the cooperative had no fiduciary duty to the plaintiffs, which were a group of deceased members’ estates. In addition, it declared that the cooperative had authority to adopt a procedure for retiring deceased members’ capital credits on an accelerated and discounted basis. However, it expressly did not rule on whether the cooperative, in practice, properly discounted the capital credits. In other words, the court reserved judgment on the specific manner of discounting the particular capital credits at issue in this case. Read More »Cooperative Litigation Update: N.C. Court Rules on Coop’s Discounting Program

Cooperative Litigation Update: Texas Cooperative Lawsuit Considered on Appeal

by David R. Cook Jr.
August 7, 2012February 15, 2022

Earlier this past July, the Texas Court of Appeals ruled on important aspects of the cooperative lawsuit concerning Denton County Electric Cooperative, Inc., d/b/a CoServ Electric (“CoServ”). The court ruled, among other things, that (i) the cooperative was not subject to certain statutory rules governing non-profit corporations, and (ii) the electric cooperative statute did not impose a fiduciary duty on the cooperative itself. Read More »Cooperative Litigation Update: Texas Cooperative Lawsuit Considered on Appeal

AHC Cooperative Tax Brief: Telephone Cooperative’s Sale of Subsidiary

by David R. Cook Jr.
August 4, 2012February 15, 2022

In the latest cooperative tax ruling, the Service ruled that a cooperative’s (“Cooperative”) gain on sale of stock in corporations that offered services to Cooperative’s members was patronage-sourced. The ruling was important to Cooperative because it expected to fail the Member Income Test of Section 501(c)(12), subjecting Cooperative to regular corporate income tax. The favorable ruling allowed Cooperative to avoid substantial taxes in the gain.

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