The GGC Board of Directors will propose an amendment to the GGC Bylaws which would change the allocation of income between Method A and Method B pools.
Presently, Section 8.2 (c) of the Bylaws requires the allocation of 25% of income to bushels delivered through the Method A pool even if Method A bushels delivered are less than 25%. This situation would result in varying income allocations by year and by bushel for each member of the cooperative. Tracking these varied allocations through distributions to members and through the member K-1 tax forms has been described as a ‘nightmare scenario’ that could cost in excess of $250,000 in increased administrative and accounting costs on an annual basis.
Historically, Method A pool bushels delivered have exceeded the 25% threshold so there was no cause for concern. Lately, however, we have come dangerously close to dropping below the 25% threshold. In response to this situation, the Board: a) increased the Method A incentive payment from $0.05 to $0.10/bushel for 2023; AND b) proposes to reduce the Method A income allocation requirement from 25% to 15%, effective as of January 1, 2023.
Given the change in the Method A Incentive for 2023 and in light of the proposed amendment to the Bylaws, GGC members will be given the opportunity to adjust their Annual Delivery Election for 2023 through the end of March of 2023.
The proposed amendment will be submitted to GGC members along with their ballots to elect Directors for the Board in advance of the 2023 Annual Meeting.