(a) With respect to the supplying or furnishing of service by a cooperative in pursuance of the primary purpose, the revenues therefrom for any fiscal year, in excess of the amount thereof necessary, to:(1) Defray expenses of the cooperative, including the operation and maintenance of its facilities during such fiscal year;(2) Pay interest and principal obligations of the cooperative coming due in such fiscal year;(3) Finance, or to provide a reserve to finance, the construction or acquisition by the cooperative of additional facilities to the extent determined by the board;(4) Provide a reasonable reserve for working capital;(5) Provide a reserve for the payment of indebtedness of the cooperative maturing more than one (1) year after the date of the incurrence of such indebtedness in an amount not less than the total of the interest and principal payments in respect thereof required to be made during the next following fiscal year; and(6) Provide a fund for education in cooperation and for the dissemination of information concerning the effective use and conservation of electric power and energy and concerning any other services made available by the cooperative; shall be ation and for the dissemination of information concerning the effective use and conservation of electric power and energy and concerning any other services made available by the cooperative; shall be distributed by the cooperative to patrons in the manner provided for in the bylaws, either:(A) As patronage refunds prorated in accordance with the patronage of the cooperative by the respective patrons paid for during or with respect to such fiscal year;(B) By way of general reductions of rates or other charges; or(C) By any combination of methods in (b)(1)-(3).(b) With respect to the supplying or furnishing of services in pursuance of one (1) or more secondary purposes, the revenues of a cooperative shall, as separately accounted for and determined for each such service, be first applied as provided in subdivisions (a)(1)-(6) and then distributed to the patrons of each such service in the manner provided for in the bylaws, either:(1) As patronage refunds prorated in accordance with the patronage of the cooperative by the respective patrons paid for during or with respect to such fiscal year;(2) By way of general reductions of rates or other charges;(3) By crediting patrons with the patronage of the cooperative by the respective patrons paid for during or with respect to such fiscal year;(2) By way of general reductions of rates or other charges;(3) By crediting patrons with having furnished the cooperative capital in amounts equal to the amounts of their patronage not refunded pursuant to subdivision (b)(1) and not used for general reduction of rates or other changes pursuant to subdivision (b)(2), all or any portion of such capital to be redeemable and be retired at such later time as the board in its sole discretion determines that such will not impair the cooperative's financial condition and will be in the cooperative's best interests; or(4) By any combination of methods in subdivisions (b)(1)-(3).(c) Nothing contained in subsection (a) or (b) shall be construed to prohibit the payment by a cooperative of all or any part of its indebtedness prior to the date when the same shall become due.Acts 1988, ch. 689, § 2; T.C.A. § 65-25-212.
Tennessee Legal Code