Business description of TRISTATE-GENERATION-AND-TRANSMISSION-ASSOCIATION-INC from last 10-k form

B USINESS

OVERVIEW

Our Business

Tri-State Generation and Transmission Association, Inc. is a taxable wholesale electric power generation and transmission cooperative operating on a not‑for‑profit basis serving major parts of Colorado, Nebraska, New Mexico and Wyoming.  We were incorporated under the laws of the State of Colorado in 1952 as a cooperative corporation.  We supply wholesale electric power to our Members, which, in turn, supply retail electric power to residential, commercial, industrial and agricultural customers in a service area with a population of approximately 1.5 million people.

We are owned entirely by our 44 Members.  Forty of our Members are not‑for‑profit, electric distribution cooperative associations.  The remaining four Members are public power districts, which are political subdivisions of the State of Nebraska.  The retail service territory of our Members covers approximately 200,000 square miles and their customers include rural residences, farms and ranches, and large and small businesses and industries.  Our Members are the sole state certified providers of electric service to retail (residential and business) customers within their designated service territories.

Our principal executive offices are located at 1100 West 116th Avenue, Westminster, Colorado 80234.  Our telephone number is (303) 452‑6111.  Our website is www.tristategt.org.  Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on 8-K and amendments to those reports are made available on our website as soon as reasonably practicable after the material is filed with the SEC. Information contained on our website is not incorporated by reference into and should not be considered to be part of this annual report.

Including our subsidiaries, as of December 31, 2015, we employed 1,561 people, of which approximately 361 were subject to collective bargaining agreements.  As of the date of this annual report on Form 10-K, none of these collective bargaining agreements will expire within one year.

Cooperative Structure

A cooperative is a business entity owned by its members, which are also its retail or wholesale customers.  Cooperatives are designed to give their members the opportunity to satisfy their collective needs in a particular area of business more effectively than if the members acted independently.  As organizations acting on a not‑for‑profit basis, cooperatives provide services to their members on a cost effective basis, in part by eliminating the need to produce profits or a return on equity in excess of required margins.  Cooperatives generally establish rates to recover their cost‑of‑service and to collect a portion of revenues in excess of expenses, which constitutes margins.  Margins not distributed to members in cash constitute patronage capital, a cooperative’s principal source of equity.  Patronage capital is held for the account of the members without interest and returned when the board of directors deems it appropriate to do so.  The timing and amount of any actual return of capital to the members depends on the financial goals of the cooperative and the cooperative’s loan and security agreements.

Electric cooperatives generally include distribution cooperatives, such as the majority of our Members, and generation and transmission cooperatives, such as us.  The primary purpose of electric distribution cooperatives is to supply the requirements of their retail consumers through bulk purchases of capacity and energy and to maintain a distribution system to deliver the electricity necessary to satisfy their consumers’ requirements.  The primary purpose of generation and transmission cooperatives is to provide wholesale electric power to their member distribution cooperatives.