Tri-State Generation & Transmission Association 10-Q 10 May 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information	3 Months Ended
	Mar. 31, 2019shares
Document and Entity Information
Entity Registrant Name	Tri-State Generation & Transmission Association, Inc.
Entity Central Index Key	0001637880
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019
Entity Common Stock, Shares Outstanding	0

Consolidated Statements of Fina

Consolidated Statements of Financial Position - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Electric plant
In service	$ 5,933,535	$ 5,899,128
Construction work in progress	195,435	207,732
Total electric plant	6,128,970	6,106,860
Less allowances for depreciation and amortization	(2,526,125)	(2,499,376)
Net electric plant	3,602,845	3,607,484
Other plant	395,124	384,650
Less allowances for depreciation, amortization and depletion	(112,866)	(110,939)
Net other plant	282,258	273,711
Total property, plant and equipment	3,885,103	3,881,195
Other assets and investments
Investment in other associations	162,410	161,487
Investments in and advances to coal mines	18,205	18,928
Restricted cash and investments	13,612	10,606
Intangible assets, net of accumulated amortization	1,831	3,662
Other noncurrent assets	8,988	9,022
Total other assets and investments	205,046	203,705
Current assets
Cash and cash equivalents	111,377	116,858
Restricted cash and investments	140	126
Deposits and advances	35,500	29,641
Accounts receivable—Members	99,303	107,572
Other accounts receivable	26,356	22,434
Coal inventory	42,441	55,883
Materials and supplies	97,147	93,786
Total current assets	412,264	426,300
Deferred charges
Regulatory assets	433,677	437,377
Prepayment—NRECA Retirement Security Plan	30,891	31,837
Other	55,158	46,453
Total deferred charges	519,726	515,667
Total assets	5,022,139	5,026,867
Capitalization
Patronage capital equity	1,022,743	1,015,754
Accumulated other comprehensive income (loss)	194	375
Noncontrolling interest	109,732	110,169
Total equity	1,132,669	1,126,298
Long-term debt	3,069,090	3,109,301
Total capitalization	4,201,759	4,235,599
Current liabilities
Member advances	13,322	13,988
Accounts payable	94,439	105,009
Short-term borrowings	224,208	204,145
Accrued expenses	34,592	40,285
Current asset retirement obligations	2,156	2,183
Accrued interest	48,857	32,070
Accrued property taxes	26,890	28,582
Current maturities of long-term debt	99,932	95,757
Total current liabilities	544,396	522,019
Deferred credits and other liabilities
Regulatory liabilities	133,310	137,369
Deferred income tax liability	18,098	18,098
Asset retirement obligations	65,008	54,589
Other	49,920	50,266
Total deferred credits and other liabilities	266,336	260,322
Accumulated postretirement benefit and postemployment obligations	9,648	8,927
Total equity and liabilities	$ 5,022,139	$ 5,026,867

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Operating revenues
Other	$ 14,256	$ 12,300
Operating revenues	339,917	318,508
Operating expenses
Purchased power	70,956	83,458
Fuel	85,149	51,940
Production	47,761	50,795
Transmission	39,142	40,064
General and administrative	10,813	7,728
Depreciation, amortization and depletion	38,145	40,088
Coal mining	3,596
Other	3,838	4,136
Operating expenses	299,400	278,209
Operating margins	40,517	40,299
Other income
Interest	1,415	1,203
Capital credits from cooperatives	2,997	4,055
Other, net	1,281	1,204
Total other income	5,693	6,462
Interest expense, net of amounts capitalized	38,281	38,021
Income tax benefit	(77)	(151)
Net margins including noncontrolling interest	8,006	8,891
Net income attributable to noncontrolling interest	(1,017)	(797)
Net margins attributable to the Association	6,989	8,094
Member electric sales
Operating revenues
Operating revenues	298,931	289,346
Non-member electric sales
Operating revenues
Operating revenues	$ 26,730	$ 16,862

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Consolidated Statements of Comprehensive Income
Net margins including noncontrolling interest	$ 8,006	$ 8,891
Other comprehensive income (loss):
Reclassification adjustment for unrealized gain on securities available for sale included in net margin		(159)
Amortization of prior service cost (credit)	33	(20)
Unrecognized prior service cost	(214)
Other comprehensive income (loss)	(181)	(179)
Comprehensive income including noncontrolling interest	7,825	8,712
Net comprehensive income attributable to noncontrolling interest	(1,017)	(797)
Comprehensive income attributable to the Association	$ 6,808	$ 7,915

Consolidated Statements of Equi

Consolidated Statements of Equity - USD ($) $ in Thousands	Patronage capital	Accumulated other comprehensive income (loss)	Noncontrolling interest	Total
Equity at beginning of period at Dec. 31, 2017	$ 1,003,020	$ (210)	$ 111,295
Change in Equity
Net margins attributable to the Association	8,094			$ 8,094
Reclassification adjustment for unrealized gain on securities available for sale included in net margin		(159)		(159)
Amortization of prior service cost (credit)		(20)		(20)
Net comprehensive income attributable to noncontrolling interest			797	797
Equity distribution to noncontrolling interest			(2,858)
Equity at end of period at Mar. 31, 2018	1,011,114	(389)	109,234	1,119,959
Equity at beginning of period at Dec. 31, 2018	1,015,754	375	110,169	1,126,298
Change in Equity
Net margins attributable to the Association	6,989			6,989
Amortization of prior service cost (credit)		33		33
Unrecognized prior service cost		(214)		(214)
Net comprehensive income attributable to noncontrolling interest			1,017	1,017
Equity distribution to noncontrolling interest			(1,454)
Equity at end of period at Mar. 31, 2019	$ 1,022,743	$ 194	$ 109,732	$ 1,132,669

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Operating activities
Net margins including noncontrolling interest	$ 8,006	$ 8,891
Adjustments to reconcile net margins to net cash provided by operating activities:
Depreciation, amortization and depletion	38,145	40,088
Amortization of intangible asset	1,831	1,831
Amortization of NRECA Retirement Security Plan prepayment	1,343	1,343
Amortization of debt issuance costs	577	514
Capital credit allocations from cooperatives and income from coal mines over refund distributions	(265)	(1,105)
Changes in operating assets and liabilities:
Accounts receivable	3,510	677
Coal inventory	13,442	(15,954)
Materials and supplies	(3,360)	(826)
Accounts payable and accrued expenses	1,876	(14,708)
Accrued interest	16,787	1,902
Accrued property taxes	(1,692)	(891)
Other	(26)	(7,782)
Net cash provided by operating activities	80,174	13,980
Investing activities
Purchases of plant	(45,128)	(56,999)
Changes in deferred charges	(4,220)	1,003
Proceeds from other investments	65	64
Net cash used in investing activities	(49,283)	(55,932)
Financing activities
Changes in Member advances	(4,407)	(4,230)
Payments of long-term debt	(36,264)	(17,738)
Debt issuance costs	(13)
Increase in short-term borrowings, net	20,063	44,668
Retirement of patronage capital	(11,101)	(4,852)
Equity distribution to noncontrolling interest	(1,454)	(2,858)
Other	(176)	(12)
Net cash provided by (used in) financing activities	(33,352)	14,978
Net decrease in cash, cash equivalents and restricted cash and investments	(2,461)	(26,974)
Cash, cash equivalents and restricted cash and investments – beginning	127,590	150,965
Cash, cash equivalents and restricted cash and investments – ending	125,129	123,991
Supplemental cash flow information:
Cash paid for interest	23,604	37,963
Supplemental disclosure of noncash investing and financing activities:
Change in plant expenditures included in accounts payable	$ (629)	$ (739)

PRESENTATION OF FINANCIAL INFOR

PRESENTATION OF FINANCIAL INFORMATION	3 Months Ended
	Mar. 31, 2019
PRESENTATION OF FINANCIAL INFORMATION
PRESENTATION OF FINANCIAL INFORMATION	NOTE 1 – PRESENTATION OF FINANCIAL INFORMATION The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our annual report on Form 10-K for the year ended December 31, 2018 filed with the SEC. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation, have been included. Our consolidated financial position as of March 31, 2019, results of operations for the three months ended March 31, 2019 and 2018, and cash flows for the three months ended March 31, 2019 and 2018 are not necessarily indicative of the results that may be expected for an entire year or any other period. Basis of Consolidation Our consolidated financial statements include the accounts of Tri-State Generation and Transmission Association, Inc. (“Tri-State”, “we”, “our”, “us” or “the Association”), our wholly-owned and majority-owned subsidiaries, and certain variable interest entities for which we or our subsidiaries are the primary beneficiaries. See Note 17 – Variable Interest Entities. Our consolidated financial statements also include our undivided interests in jointly owned facilities. All significant intercompany balances and transactions have been eliminated in consolidation. Jointly Owned Facilities We own undivided interests in two jointly owned generation facilities that are operated by the operating agent of each facility under joint facility ownership agreements with other utilities as tenants in common. These projects include the Yampa Project (operated by us) and the Missouri Basin Power Project (“MBPP”) (operated by Basin Electric Power Cooperative (“Basin”)). Each participant in these agreements receives a portion of the total output of the generation facilities, which approximates its percentage ownership. Each participant provides its own financing for its share of each facility and accounts for its share of the cost of each facility. The operating agent for each of these projects allocates the fuel and operating expenses to each participant based upon its share of the use of the facility. Therefore, our share of the plant asset cost, interest, depreciation and other operating expenses is included in our consolidated financial statements. Our share in each jointly owned facility is as follows as of March 31, 2019 (dollars in thousands): Electric Construction Tri-State Plant in Accumulated Work In Share Service Depreciation Progress Yampa Project - Craig Generating Station Units 1 and 2 24.00 % $ 396,432 $ 241,590 $ 590 MBPP - Laramie River Station 27.13 % 427,398 297,710 56,916 Total $ 823,830 $ 539,300 $ 57,506 Recently Adopted Accounting Pronouncements Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new standard related to leases to increase transparency and comparability among organizations by requiring the recognition of right-of-use assets and lease liabilities on the balance sheet. Under the new lease standard, enhanced qualitative and quantitative disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing and uncertainty of cash flows from leases. We adopted the new lease standard on January 1, 2019. We elected the package of practical expedients which permits us not to reassess under the new lease standard our prior conclusions for lease identification and lease classification on expired or existing contracts and whether initial direct costs previously capitalized would qualify for capitalization under the new lease standard. We also elected to adopt the optional transition method which allows an entity to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. An entity’s reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be presented in accordance with GAAP related to leases prior to transitioning to the new lease standard. While the new lease standard had an impact on our consolidated statements of financial position, it did not have a material impact on our consolidated statements of operations. See Note 15 – Leases.

ACCOUNTING FOR RATE REGULATION

ACCOUNTING FOR RATE REGULATION	3 Months Ended
	Mar. 31, 2019
ACCOUNTING FOR RATE REGULATION
ACCOUNTING FOR RATE REGULATION	NOTE 2 – ACCOUNTING FOR RATE REGULATION We are subject to the accounting requirements related to regulated operations. In accordance with these accounting requirements, some revenues and expenses have been deferred at the discretion of our Board of Directors (“Board”), which has budgetary and rate-setting authority, if it is probable that these amounts will be refunded or recovered through future rates. Regulatory assets are costs that we expect to recover from our member distribution systems (“Members”) based on rates approved by our Board in accordance with our rate policy. Regulatory liabilities represent probable future reductions in rates associated with amounts that are expected to be refunded to our Members based on rates approved by our Board in accordance with our rate policy. We recognize regulatory assets as expenses and regulatory liabilities as operating revenue, other income, or a reduction in expense concurrent with their recovery in rates. Regulatory assets and liabilities are as follows (dollars in thousands): March 31, December 31, 2019 2018 Regulatory assets Deferred income tax expense (1) $ 18,098 $ 18,098 Deferred prepaid lease expense – Springerville Unit 3 Lease (2) 85,432 86,005 Goodwill – J.M. Shafer (3) 51,282 51,994 Goodwill – Colowyo Coal (4) 37,969 38,227 Deferred debt prepayment transaction costs (5) 147,402 149,559 Deferred Holcomb expansion impairment loss (6) 93,494 93,494 Total regulatory assets 433,677 437,377 Regulatory liabilities Interest rate swap - unrealized gain (7) 4,636 8,576 Interest rate swap - realized gain (8) 4,096 4,215 Deferred revenues (9) 82,006 82,006 Membership withdrawal (10) 42,572 42,572 Total regulatory liabilities 133,310 137,369 Net regulatory asset $ 300,367 $ 300,008 (1) A regulatory asset or liability associated with deferred income taxes generally represents the future increase or decrease in income taxes payable that will be received or settled through future rate revenues. (2) Represents deferral of the loss on acquisition related to the Springerville Generating Station Unit 3 (“Springerville Unit 3”) prepaid lease expense upon acquiring a controlling interest in the Springerville Unit 3 Partnership LP (“Springerville Partnership”) in 2009. The regulatory asset for the deferred prepaid lease expense is being amortized to depreciation, amortization and depletion expense in the amount of $2.3 million annually through the 47-year period ending in 2056 and recovered from our Members in rates. (3) Represents goodwill related to our acquisition of Thermo Cogeneration Partnership, LP in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $2.8 million annually through the 25-year period ending in 2036 and recovered from our Members in rates. (4) Represents goodwill related to our acquisition of Colowyo Coal Company LP (“Colowyo Coal”) in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $1.0 million annually through the 44-year period ending in 2056 and recovered from our Members in rates. (5) Represents transaction costs that we incurred related to the prepayment of our long-term debt in 2014. These costs are being amortized to depreciation, amortization and depletion expense in the amount of $8.6 million annually over the 21-year period ending in 2035 and recovered from our Members in rates. (6) Represents deferral of the impairment loss related to development costs, including costs for the option to purchase development rights for the expansion of the Holcomb Generating Station. The plan for the recovery from our Members in rates has not been determined by our Board. Once the plan for recovery is determined, the deferred impairment loss will be recognized in other operating expenses. (7) Represents deferral of an unrealized gain related to the change in fair value of a forward starting interest rate swap that was entered into in 2016 in order to hedge interest rates on anticipated future borrowings. Upon settlement of this interest rate swap, the realized gain or loss will be deferred and subsequently recognized as interest expense when amortized over the term of the associated long-term debt borrowing. See Note 8 – Long-Term Debt. (8) Represents deferral of a realized gain of $4.6 million related to the October 2017 settlement of a forward starting interest rate swap. This realized gain was deferred as a regulatory liability and is being amortized to interest expense over the 12-year term of the First Mortgage Obligations, Series 2017A and refunded to Members through reduced rates when recognized in future periods. (9) Represents deferral of the recognition of non-member electric sales revenues. These deferred non-member electric sales revenues will be refunded to Members through reduced rates when recognized in non-member electric sales revenue in future periods. (10) Represents the deferral of the recognition of other income recorded in connection with the withdrawal of a former Member from membership in us. This deferred membership withdrawal income will be refunded to Members through reduced rates when recognized in other income in future periods.

INVESTMENTS IN OTHER ASSOCIATIO

INVESTMENTS IN OTHER ASSOCIATIONS	3 Months Ended
	Mar. 31, 2019
INVESTMENTS IN OTHER ASSOCIATIONS
INVESTMENTS IN OTHER ASSOCIATIONS	NOTE 3 – INVESTMENTS IN OTHER ASSOCIATIONS Investments in other associations include investments in the patronage capital of other cooperatives and other required investments in the organizations. Our investment in a cooperative increases when a cooperative allocates patronage capital credits to us and it decreases when we receive a cash retirement of the allocated capital credits from the cooperative. A cooperative allocates its patronage capital credits to us based upon our patronage (amount of business done) with the cooperative. Investments in other associations are as follows (dollars in thousands): March 31, December 31, 2019 2018 Basin Electric Power Cooperative $ 118,115 $ 118,115 National Rural Utilities Cooperative Finance Corporation - patronage capital 11,704 11,704 National Rural Utilities Cooperative Finance Corporation - capital term certificates 15,953 16,018 CoBank, ACB 10,201 9,062 Western Fuels Association, Inc. 2,385 2,392 Other 4,052 4,196 Investments in other associations $ 162,410 $ 161,487 Our investments in other associations are considered equity securities without readily determinable fair values, and as such are measured at cost minus impairment. We have evaluated these investments for indicators of impairment. There were no impairments of these investments recognized during the three months ended March 31, 2019 or during 2018.

INVESTMENTS IN AND ADVANCES TO

INVESTMENTS IN AND ADVANCES TO COAL MINES	3 Months Ended
	Mar. 31, 2019
INVESTMENTS IN AND ADVANCES TO COAL MINES
INVESTMENTS IN AND ADVANCES TO COAL MINES	NOTE 4 – INVESTMENTS IN AND ADVANCES TO COAL MINES We have direct ownership and investments in coal mines to support our coal generating resources. We, and certain participants in the Yampa Project, are members of Trapper Mining, which is organized as a cooperative and is the owner and operator of the Trapper Mine near Craig, Colorado. Our investment in Trapper Mining is recorded using the equity method. In addition, we have ownership in Western Fuels Association, Inc. (“WFA”), which is an owner of Western Fuels‑Wyoming, Inc. (“WFW”), the owner and operator of the Dry Fork Mine near Gillette, Wyoming. Dry Fork Mine provides coal to MBPP, which is the owner of Laramie River Generating Station. We, through our undivided interest in the jointly owned facility MBPP, advance funds to the Dry Fork Mine. Investments in and advances to coal mines are as follows (dollars in thousands): March 31, December 31, 2019 2018 Investment in Trapper Mine $ 15,482 $ 15,350 Advances to Dry Fork Mine 2,723 3,578 Investments in and advances to coal mines $ 18,205 $ 18,928

CASH, CASH EQUIVALENTS AND REST

CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS	3 Months Ended
	Mar. 31, 2019
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS	NOTE 5 – CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS We consider highly liquid investments with an original maturity of three months or less to be cash equivalents. The fair value of cash equivalents approximates their carrying values due to their short-term maturity. Restricted cash and investments represent funds designated by our Board for specific uses and funds restricted by contract or other legal reasons. A portion of the funds are funds that have been restricted by contract that are expected to be settled within one year. These funds are therefore classified as current on our consolidated statements of financial position. The other funds are for funds restricted by contract or other legal reasons that are expected to be settled beyond one year. These funds are classified as noncurrent and are included in other assets and investments on our consolidated statements of financial position. The following table provides a reconciliation of cash, cash equivalents and restricted cash and investments reported within our consolidated statements of financial position that sum to the total of the same such amount shown in our consolidated statements of cash flows (dollars in thousands): March 31, December 31, 2019 2018 Cash and cash equivalents $ 111,377 $ 116,858 Restricted cash and investments - current 140 126 Restricted cash and investments - noncurrent 13,612 10,606 Cash, cash equivalents and restricted cash and investments $ 125,129 $ 127,590 Our Board Policy for Financial Goals and Capital Credits was revised in 2018 to provide that our Board will endeavor to fund an internally restricted cash account for the purpose of cash funding deferred revenues and incomes held as regulatory liabilities. In connection with such policy, our Board has internally restricted cash in the amount of $7.6 million and $4.6 million as of March 31, 2019 and December 31, 2018, respectively, which is included in restricted cash and investments - noncurrent.

CONTRACT ASSETS AND CONTRACT LI

CONTRACT ASSETS AND CONTRACT LIABILITIES	3 Months Ended
	Mar. 31, 2019
CONTRACT ASSETS AND CONTRACT LIABILITIES
CONTRACT ASSETS AND CONTRACT LIABILITIES	NOTE 6 – CONTRACT ASSETS AND CONTRACT LIABILITIES Contract Assets A contract asset represents an entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer when that right is conditioned on something other than the passage of time (for example, the entity’s future performance). We have no contract assets as of March 31, 2019 and December 31, 2018. Accounts Receivable We record accounts receivable for our unconditional rights to consideration arising from our performance under contracts with our Members and other parties. Uncollectible amounts, if any, are identified on a specific basis and charged to expense in the period determined to be uncollectible. See Note 13 – Revenue. Contract liabilities (unearned revenue) A contract liability represents an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer. We have received deposits from others and these deposits are reflected in unearned revenue (included in other deferred credits and other liabilities on our consolidated statements of financial position) before revenue is recognized, resulting in contract liabilities. During the three months ended March 31, 2019, we recognized $0.2 million of this unearned revenue in other operating revenues on our consolidated statements of operations. Our contract assets and liabilities consist of the following (dollars in thousands): March 31, December 31, 2019 2018 Accounts receivable - Members $ 99,303 $ 107,572 Other accounts receivable - trade: Non-member electric sales 6,669 6,998 Other 9,564 6,006 Total other accounts receivable - trade 16,233 13,004 Other accounts receivable - nontrade 10,123 9,430 Total other accounts receivable $ 26,356 $ 22,434 Contract liabilities (unearned revenue) $ 7,690 $ 7,906 On April 11, 2019, we received $6.3 million of proceeds related to the final insurance settlement of the Craig Generating Station Unit 3 unplanned outage during 2018 (this amount was included in other accounts receivable – nontrade as of March 31, 2019 and December 31, 2018).

OTHER DEFERRED CHARGES

OTHER DEFERRED CHARGES	3 Months Ended
	Mar. 31, 2019
OTHER DEFERRED CHARGES.
OTHER DEFERRED CHARGES	NOTE 7 – OTHER DEFERRED CHARGES The following other deferred charges are reflected on our consolidated statements of financial position (dollars in thousands): March 31, December 31, 2019 2018 Preliminary surveys and investigations $ 21,213 $ 20,660 Advances to operating agents of jointly owned facilities 17,628 13,161 Interest rate swap 4,636 8,576 Operating lease right-of-use assets 6,244 — Other 5,437 4,056 Total other deferred charges $ 55,158 $ 46,453 We make expenditures for preliminary surveys and investigations for the purpose of determining the feasibility of contemplated generation and transmission projects. If construction results, the preliminary survey and investigation expenditures will be reclassified to electric plant ‑ construction work in progress. If the work is abandoned, the related preliminary survey and investigation expenditures will be charged to the appropriate operating expense account or the expense could be deferred as a regulatory asset to be recovered from our Members in rates subject to approval by our Board, which has budgetary and rate-setting authority. We make advance payments to the operating agents of jointly owned facilities to fund our share of costs expected to be incurred under each project including MBPP – Laramie River Station, and Yampa Project – Craig Generating Station Units 1 and 2. We also make advance payments to the operating agent of Springerville Unit 3. In 2016, we entered into a forward starting interest rate swap to hedge a portion of our future long-term debt interest rate exposure. The unrealized gain on this interest rate swap of $4.6 and $8.6 million as of March 31, 2019 and December 31, 2018, respectively, was deferred in accordance with the accounting requirements related to regulated operations. See Note 2 – Accounting for Rate Regulation. A right-of-use asset represents a lessee’s right to use (control the use of) the underlying asset for the lease term. Right-of-use assets are included in other deferred charges and presented net of accumulated amortization. See Note 15 – Leases.

LONG-TERM DEBT

LONG-TERM DEBT	3 Months Ended
	Mar. 31, 2019
LONG-TERM DEBT.
LONG-TERM DEBT	NOTE 8 – LONG-TERM DEBT We have $3.1 billion of long-term debt which consists of mortgage notes payable, pollution control revenue bonds and the Springerville certificates. The mortgage notes payable and pollution control revenue bonds are secured on a parity basis by a Master First Mortgage Indenture, Deed of Trust and Security Agreement (“Master Indenture”) except for one unsecured note in the aggregate amount of $32.6 million as of March 31, 2019. Substantially all our assets, rents, revenues and margins are pledged as collateral. The Springerville certificates are secured by the assets of Springerville Unit 3. All long-term debt contains certain restrictive financial covenants, including a debt service ratio requirement and equity to capitalization ratio requirement. We have a secured revolving credit facility with National Rural Utilities Cooperative Finance Corporation, as lead arranger and administrative agent, in the amount of $650 million (“2018 Revolving Credit Agreement”) that expires on April 25, 2023. We had no outstanding borrowings as of March 31, 2019. As of March 31, 2019, we had $425.0 million in availability (including $275.0 million under the commercial paper back-up sublimit) under the 2018 Revolving Credit Agreement. Long-term debt consists of the following (dollars in thousands): March 31, December 31, 2019 2018 Total debt $ 3,191,398 $ 3,227,663 Less debt issuance costs (29,211) (29,775) Less debt discounts (10,082) (10,139) Plus debt premiums 16,917 17,309 Total debt adjusted for debt issuance costs, discounts and premiums 3,169,022 3,205,058 Less current maturities (99,932) (95,757) Long-term debt $ 3,069,090 $ 3,109,301 On December 11, 2018, we entered into a Term Loan Agreement with CoBank, ACB under which we issued our First Mortgage Obligations, Series 2018B which consist of fixed rate borrowings in the amount of $55.2 million and variable rate borrowings in the amount of $69.8 million. As of March 31, 2019, the full amount of the fixed rate borrowings was funded and $34.9 million of the variable rate borrowings was funded. On April 4, 2019, we drew the remaining $34.9 million of variable rate funds. $55.2 million of the total proceeds were used to refinance an existing term loan with CoBank, ACB and the remaining proceeds were used to delay additional paper borrowings or to repay outstanding commercial paper. We are exposed to certain risks in the normal course of operations in providing a reliable and affordable source of wholesale electricity to our Members. These risks include interest rate risk, which represents the risk of increased operating expenses and higher rates due to increases in interest rates related to anticipated future long-term borrowings. To manage this exposure, we entered into a forward starting interest rate swap to hedge a portion of our future long‑term debt interest rate exposure. We anticipate settling the interest rate swap in conjunction with the issuance of future long-term debt. The terms of the remaining interest rate swap contract are as follows (dollars in thousands): Notional Fixed Benchmark Interest Effective Maturity Amount Rate (Pay) Rate (Receive) Date Date Interest rate swap $ 80,000 2.304 % 30 year - LIBOR June 2019 June 2049

SHORT-TERM BORROWINGS

SHORT-TERM BORROWINGS	3 Months Ended
	Mar. 31, 2019
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS	NOTE 9 – SHORT-TERM BORROWINGS We have a commercial paper program under which we issue unsecured commercial paper in aggregate amounts not exceeding the commercial paper back-up sublimit under our 2018 Revolving Credit Agreement, which is the lesser of $500 million or the amount available under our 2018 Revolving Credit Agreement. The commercial paper issuances are used to provide an additional financing source for our short-term liquidity needs. The maturities of the commercial paper issuances vary, but may not exceed 397 days from the date of issue. The commercial paper notes are classified as current and are included in current liabilities as short-term borrowings on our consolidated statements of financial position. Commercial paper consisted of the following (dollars in thousands): March 31, December 31, 2019 2018 Commercial paper outstanding, net of discounts $ 224,208 $ 204,145 Weighted average interest rate 2.69 % 2.65 % At March 31, 2019, $275.0 million of the commercial paper back-up sublimit remained available under the 2018 Revolving Credit Agreement. See Note 8 – Long-Term Debt.

ASSET RETIREMENT OBLIGATIONS

ASSET RETIREMENT OBLIGATIONS	3 Months Ended
	Mar. 31, 2019
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS	NOTE 10 – ASSET RETIREMENT OBLIGATIONS We account for current obligations associated with the future retirement of tangible long‑lived assets in accordance with the accounting guidance relating to asset retirement and environmental obligations. This guidance requires that legal obligations associated with the retirement of long‑lived assets be recognized at fair value at the time the liability is incurred and capitalized as part of the related long‑lived asset. Over time, the liability is adjusted to its present value by recognizing accretion expense and the capitalized cost of the long‑lived asset is depreciated over the estimated useful life of that asset. In the absence of quoted market prices, we determine fair value by using present value techniques in which estimates of future cash flows associated with retirement activities are discounted using a credit adjusted risk‑free rate and market risk premium. Upon settlement of an asset retirement obligation, we will apply payment against the estimated liability and incur a gain or loss if the actual retirement costs differ from the estimated recorded liability. Coal mines: We have asset retirement obligations for the final reclamation costs and post‑reclamation monitoring related to the Colowyo Mine, the New Horizon Mine, and the Fort Union Mine. The New Horizon Mine started final reclamation in June 2017. Generation: We, including through our undivided interest in jointly owned facilities, have asset retirement obligations related to equipment, dams, ponds, wells and underground storage tanks at the generating stations. Aggregate carrying amounts of asset retirement obligations are as follows (dollars in thousands): Three Months Ended March 31, 2019 Asset retirement obligations at beginning of period $ 56,772 Liabilities incurred 9,900 Liabilities settled (146) Accretion expense 638 Change in cash flow estimate — Total asset retirement obligations at end of period $ 67,164 Less current asset retirement obligations at end of period (2,156) Long-term asset retirement obligations at end of period $ 65,008 The additional asset retirement obligation liability of $9.9 million was due to anticipated revision to the New Horizon mine reclamation plan to accommodate an alternative post mine land use, including construction of a pond, as necessary for final mine reclamation. We also have asset retirement obligations with indeterminate settlement dates. These are made up primarily of obligations attached to transmission and other easements that are considered by us to be operated in perpetuity and therefore the measurement of the obligation is not possible. A liability will be recognized in the period in which sufficient information exists to estimate a range of potential settlement dates as is needed to employ a present value technique to estimate fair value. The asset retirement obligations are determined in accordance with the accounting guidance and are different than the amount of any guarantees, or self-bonds for, reclamation obligations that are based upon state requirements.

OTHER DEFERRED CREDITS AND OTHE

OTHER DEFERRED CREDITS AND OTHER LIABILITIES	3 Months Ended
	Mar. 31, 2019
OTHER DEFERRED CREDITS AND OTHER LIABILITIES
OTHER DEFERRED CREDITS AND OTHER LIABILITIES	NOTE 11 – OTHER DEFERRED CREDITS AND OTHER LIABILITIES The following other deferred credits and other liabilities are reflected on our consolidated statements of financial position (dollars in thousands): March 31, December 31, 2019 2018 Transmission easements $ 20,772 $ 20,966 Operating lease liabilities - noncurrent 1,823 — Contract liabilities (unearned revenue) - noncurrent 4,498 4,592 Customer deposits 2,597 2,458 Other 20,230 22,250 Total other deferred credits and other liabilities $ 49,920 $ 50,266 In 2015, we renewed transmission right of way easements on tribal nation lands where certain of our electric transmission lines are located. $31.9 million will be paid by us for these easements from 2019 through the individual easement terms ending between 2036 and 2040. The present values for the remaining easement payments were $20.8 and $21.0 million as of March 31, 2019 and December 31, 2018, respectively, which are recorded as other deferred credits and other liabilities. A lease liability represents a lessee’s obligation to make lease payments over the lease term. The long-term portion of our lease liabilities are included in other deferred credits and other liabilities and the current portion of our lease liabilities are included in current liabilities. See Note 15 – Leases. A contract liability represents an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer. We have received deposits from others and these deposits are reflected in contract liabilities (unearned revenue) until recognized in other operating revenues over the life of the agreement. We have received deposits from various parties and those that may still be required to be returned are a liability and these are reflected in customer deposits.

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS	3 Months Ended
	Mar. 31, 2019
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS	NOTE 12 – EMPLOYEE BENEFIT PLANS Postretirement Benefits Other Than Pensions We sponsor three medical plans for all non-bargaining unit employees under the age of 65. Two of the plans provide postretirement medical benefits to full-time non-bargaining unit employees and retirees who receive benefits under those plans, who have attained age 55, and who elect to participate. All three of these non-bargaining unit medical plans offer postemployment medical benefits to employees on long-term disability. The plans were unfunded at March 31, 2019, are contributory (with retiree premium contributions equivalent to employee premiums, adjusted annually) and contain other cost-sharing features such as deductibles. The postretirement medical benefit and postemployment medical benefit obligations are determined annually (during the fourth quarter) by an independent actuary and are included in accumulated postretirement benefit and postemployment obligations on our consolidated statements of financial position as follows (dollars in thousands): March 31, 2019 Postretirement medical benefit obligation at beginning of period $ 8,556 Service cost 169 Interest cost 72 Benefit payments (net of contributions by participants) (132) Postretirement medical benefit obligation at end of period $ 8,665 Postemployment medical benefit obligation at end of period 371 Total postretirement and postemployment medical obligations at end of period $ 9,036 The service cost component of our net periodic benefit cost is included in operating expenses on our consolidated statements of operations. The components of net periodic benefit cost other than the service cost component are included in other income (expense) on our consolidated statements of operations. In accordance with the accounting standard related to postretirement benefits other than pensions, actuarial gains and losses are not recognized in income but are instead recorded in accumulated other income on our consolidated statements of financial position. If the unrecognized amount is in excess of 10 percent of the projected benefit obligation, amounts are reclassified out of accumulated other comprehensive income and included in net income as the excess is amortized over the average remaining service lives of the active plan participants. Unrecognized actuarial gains and losses have been determined per actuarial studies for the postretirement medical benefit obligation. The net unrecognized actuarial gains and losses related to the postretirement medical benefit obligations are included in accumulated other comprehensive income as follows (dollars in thousands): March 31, 2019 Amounts included in accumulated other comprehensive income at beginning of period $ 375 Amortization of prior service credit into other income (20) Amounts included in accumulated other comprehensive income at end of period $ 355 Defined Benefit Plans We participate in the NRECA Pension Restoration Plan and the NRECA Executive Benefit Restoration Plan, both of which are intended to provide a supplemental benefit to the defined benefit plan for an eligible group of highly compensated employees. Eligible employees include the Chief Executive Officer and any other employees that become eligible. All our executive employees currently participate in one of the following pension restoration plans: the NRECA Pension Restoration Plan or the NRECA Executive Benefit Restoration Plan. Eligibility is determined annually and is based on January 1 base salary that exceeds the limits of the defined benefit plan. As of March 31, 2019, the executive benefit restoration obligation included in accumulated postretirement benefit and postemployment obligations on our consolidated statements of financial position was $0.6 million.

REVENUE

REVENUE	3 Months Ended
	Mar. 31, 2019
REVENUE
REVENUE	NOTE 13 – REVENUE Revenue from Contracts with Customers Our revenues are derived primarily from the sale of electric power to our Members pursuant to long-term wholesale electric service contracts. Our contracts with our Members extend through 2050 for 42 Members and 2040 for the remaining Member. Member electric sales Revenues from electric power sales to our Members are primarily from our Class A rate schedule. Our Class A rate schedule for electric power sales to our Members consist of three billing components: an energy rate and two demand rates. Our Class A rate schedule is variable and is approved by our Board. Energy and demand have the same pattern of transfer to our Members and are both measurements of the electric power provided to our Members. Therefore, the provision of electric power to our Members is one performance obligation. Prior to our Members’ requirement for electric power, we do not have a contractual right to consideration as we are not obligated to provide electric power until the Member requires each incremental unit of electric power. We transfer control of the electric power to our Members over time and our Members simultaneously receive and consume the benefits of the electric power. Progress toward completion of our performance obligation is measured using the output method, meter readings are taken at the end of each month for billing purposes, energy and demand are determined after the meter readings and Members are invoiced based on the meter reading. Payments from our Members are received in accordance with the wholesale electric service contracts’ terms, which is less than 30 days from the invoice date. Member electric sales revenue is recorded as Member electric sales on our consolidated statements of operations and Accounts receivable – Members on our consolidated statements of financial position. In addition to our Member electric sales, we have non-member electric sales and other operating revenue which consist of several revenue streams. The following revenue is reflected on our consolidated statements of operations as follows (dollars in thousands): Three Months Ended March 31, 2019 2018 Non-member electric sales: Long-term contracts $ 11,682 $ 11,943 Short-term contracts 15,048 4,919 Other 14,256 12,300 Total non-member electric sales and other operating revenue $ 40,986 $ 29,162 Non-member electric sales Revenues from electric power sales to non-members are primarily from long-term contracts and short-term market sales. Prior to our customers’ demand for energy, we do not have a contractual right to consideration as we are not obligated to provide energy until the customer demands each incremental unit of energy. We transfer control of the energy to our customer over time and our customer simultaneously receives and consumes the benefits of the electric power. Progress toward completion of our performance obligation is measured using the output method. Payments are received in accordance with the contract terms, which is less than 30 days after the invoice is received by the customer. Other operating revenue Other operating revenue consists primarily of the following revenue streams: wheeling, transmission, supplying steam and water, leasing, and coal sales. Wheeling revenue is received when we charge other energy companies for transmitting electricity over our transmission lines (payments are received in accordance with the contract terms which is within 20 days of the date the invoice was issued). Transmission revenue is from Southwest Power Pool’s scheduling of transmission across our transmission assets because of our membership in it (Southwest Power Pool collects the revenue from the customer and pays us for the scheduling, system control, dispatch transmission service, and the annual transmission revenue requirement). Steam and water revenue is derived from supplying steam and water to a paper manufacturer located adjacent to the Escalante Generating Station (payments from the customer are received in accordance with the contract terms which is less than 15 days from the invoice date). Each of these services or goods are provided over time and progress toward completion of our performance obligations are measured using the output method. Lease revenue is primarily from a certain power sales arrangement that is required to be accounted for as an operating lease since the arrangement conveys the right to use power generating equipment for a stated period of time. Coal sales revenue results from the sale of coal from the Colowyo Mine to third parties. We have an obligation to deliver coal and our progress of our completion toward our performance obligation is measured using the output method. Our performance obligation is completed as coal is delivered.

INCOME TAXES

INCOME TAXES	3 Months Ended
	Mar. 31, 2019
INCOME TAXES
INCOME TAXES	NOTE 14 – INCOME TAXES We are a taxable cooperative subject to federal and state taxation. As a taxable electric cooperative, we are allowed a tax exclusion for margins allocated as patronage capital. We utilize the liability method of accounting for income taxes. However, in accordance with our regulatory accounting treatment, changes in deferred tax assets or liabilities result in the establishment of a regulatory asset or liability. A regulatory asset or liability associated with deferred income taxes generally represents the future increase or decrease in income taxes payable that will be settled or received through future rate revenues. Under this regulatory accounting approach, any income tax expense or benefit on our consolidated statements of operations includes only the current provision. Our consolidated statements of operations included an income tax benefit of $0.1 million for the three months ended March 31, 2019 and $0.2 million for the comparable period in 2018. These income tax benefits are due to an alternative minimum tax credit refund.

LEASES

LEASES	3 Months Ended
	Mar. 31, 2019
LEASES
LEASES	NOTE 15 – LEASES Leasing Arrangements As Lessee We determine if an arrangement is a lease upon commencement of the contract. If an arrangement is determined to be a long-term lease (greater than 12 months), we recognize a right-of-use asset and lease liability based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise those options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Right-of-use assets are included in other deferred charges, the current portion of lease liabilities are included in current liabilities and the long-term portion of lease liabilities are included in other deferred credits and other liabilities on our consolidated statements of financial position. We have elected to apply the short-term lease exception for contracts that have a lease term of twelve months or less and do not include an option to purchase the underlying asset. Therefore, we do not recognize a right-of-use asset or lease liability for such contracts. We recognize short-term lease payments as expense on a straight-line basis over the lease term. Variable lease payments that do not depend on an index or rate are recognized as expense. We have lease agreements as lessee for the right to use power generating equipment at the Brush Generating Station and for the use of various facilities and operational assets. Under the power purchase arrangement at the Brush Generating Station, we are required to account for the arrangement as an operating lease since it conveys to us the right to direct the use of 70 megawatts at the Brush Generating Station for a 10-year term ending December 31, 2019 and whereby we provide our own natural gas for generation of electricity. We do not anticipate renewing this power purchase arrangement. Rent expense for all short-term and long-term operating leases was $1.8 million for the three months ended March 31, 2019 and $2.0 million for the comparable period in 2018. Rent expense is included in operating expenses on our consolidated statements of operations. As of March 31, 2019, there were no arrangements accounted for as finance leases. Our consolidated statements of financial position include the following lease components (dollars in thousands): March 31, 2019 Operating leases Operating lease right-of-use assets $ 7,564 Less: Accumulated amortization (1,320) Net operating lease right-of-use assets $ 6,244 Operating lease liabilities - current $ 4,970 Operating lease liabilities - noncurrent 1,823 Total operating lease liabilities $ 6,793 Operating leases Weighted average remaining lease term (years) Weighted average discount rate Future expected minimum lease commitments under operating leases are as follows (dollars in thousands): 2019 $ 5,199 2020 459 2021 360 2022 229 2023 172 Thereafter 985 Total lease payments $ 7,404 Less imputed interest (611) Total $ 6,793 Leasing Arrangements As Lessor We have lease agreements as lessor for power generating equipment at the J.M. Shafer Generating Station and for certain operational assets. Under the power sales arrangement at the J.M. Shafer Generating Station, we are required to account for the arrangement as an operating lease since it conveys to a third party the right to direct the use of 122 megawatts of the 272 megawatt generating capability of the J.M. Shafer Generating Station through June 30, 2019 whereby the third party provides its own natural gas for generation of electricity. The revenue from these lease agreements of $4.3 and $4.6 million for the three months ended March 31, 2019 and 2018, respectively, are included in other operating revenue on our consolidated statements of operations.

FAIR VALUE

FAIR VALUE	3 Months Ended
	Mar. 31, 2019
FAIR VALUE
FAIR VALUE	NOTE 16 – FAIR VALUE Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability between market participants in the principal or in the most advantageous market when no principal market exists. The fair value measurement accounting guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability (market participants are assumed to be independent, knowledgeable, able and willing to transact an exchange and not under duress). In considering market participant assumptions in fair value measurements, a three-tier fair value hierarchy for measuring fair value was established which prioritizes the inputs used in measuring fair value as follows: Level 1 inputs are based upon quoted prices for identical instruments traded in active (exchange-traded) markets. Valuations are obtained from readily available pricing sources for market transactions (observable market data) involving identical assets or liabilities. Level 2 inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques (such as option pricing models, discounted cash flow models) for which all significant assumptions are observable in the market. Level 3 inputs consist of unobservable market data which is typically based on an entity’s own assumptions of what a market participant would use in pricing an asset or liability as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Marketable Securities We hold marketable securities in connection with the directors’ and executives’ elective deferred compensation plans which consist of investments in stock funds, bond funds and money market funds. These securities are measured at fair value on a recurring basis with changes in fair value recognized in earnings. The estimated fair value of the investments is based upon their active market value (Level 1 inputs) and is included in other noncurrent assets on our consolidated statements of financial position. The cost and fair values of our marketable securities are as follows (dollars in thousands): As of March 31, 2019 As of December 31, 2018 Estimated Estimated Cost Fair Value Cost Fair Value Marketable securities $ 571 $ 537 $ 818 $ 712 Cash Equivalents We invest portions of our cash and cash equivalents in commercial paper, money market funds, and other highly liquid investments. The fair value of these investments approximates our cost basis in the investments. In aggregate, the fair value was $102.3 million as of March 31, 2019 and $107.2 million as of December 31, 2018. Debt The fair values of debt were estimated using discounted cash flow analyses based on our current incremental borrowing rates for similar types of borrowing arrangements. These valuation assumptions utilize observable inputs based on market data obtained from independent sources and are therefore considered Level 2 inputs (quoted prices for similar assets, liabilities (adjusted) and market corroborated inputs). The principal amounts and fair values of our debt are as follows (dollars in thousands): As of March 31, 2019 As of December 31, 2018 Principal Estimated Principal Estimated Amount Fair Value Amount Fair Value Total debt $ 3,191,398 $ 3,480,702 $ 3,227,663 $ 3,421,753 Interest Rate Swaps In 2016, we entered into a forward starting interest rate swap to hedge a portion of our future long-term debt interest rate expense. See Note 8 – Long-Term Debt. This interest rate swap is a derivative instrument in accordance with ASC 815, Derivatives and Hedging, and is recorded at fair value on a recurring basis. The estimated fair value of this interest rate swap utilizes observable inputs based on market data obtained from independent sources and is therefore considered a Level 2 input (quoted prices for similar assets, liabilities (adjusted) and market corroborated inputs) and is included in other deferred charges on our consolidated statements of financial position. At March 31, 2019, the fair value of the interest rate swap was an unrealized gain of $4.6 million, which was deferred in accordance with our regulatory accounting.

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES	3 Months Ended
	Mar. 31, 2019
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES	NOTE 17 – VARIABLE INTEREST ENTITIES The following is a description of our financial interests in variable interest entities that we consider significant. This includes an entity for which we are determined to be the primary beneficiary and therefore consolidate and also entities for which we are not the primary beneficiary and therefore do not consolidate. Consolidated Variable Interest Entity Springerville Partnership: We own a 51 percent equity interest, including the 1 percent general partner equity interest, in the Springerville Partnership, which is the 100 percent owner of Springerville Unit 3 Holding LLC (“Owner Lessor”). The Owner Lessor is the owner of the Springerville Unit 3. We, as general partner of the Springerville Partnership, have the full, exclusive and complete right, power and discretion to operate, manage and control the affairs of the Springerville Partnership and take certain actions necessary to maintain the Springerville Partnership in good standing without the consent of the limited partners. Additionally, the Owner Lessor has historically not demonstrated an ability to finance its activities without additional financial support. The financial support is provided by our remittance of lease payments in order to permit the Owner Lessor, the holder of the Springerville Unit 3 assets, to pay the debt obligations and equity returns of the Springerville Partnership. We have the primary risk (expense) exposure in operating the Springerville Unit 3 assets and are responsible for 100 percent of the operation, maintenance and capital expenditures of Springerville Unit 3 and the decisions related to those expenditures including budgeting, financing and dispatch of power. Based on all these facts, it was determined that we are the primary beneficiary of the Owner Lessor. Therefore, the Springerville Partnership and Owner Lessor have been consolidated by us. Assets and liabilities of the Springerville Partnership that are included in our consolidated statements of financial position are as follows (dollars in thousands): March 31, December 31, 2019 2018 Net electric plant $ 790,014 $ 794,549 Noncontrolling interest $ 109,732 $ 110,169 Long-term debt $ 381,914 $ 416,057 Accrued interest $ 4,420 $ 12,056 Our consolidated statements of operations include the following Springerville Partnership expenses for the three months ended March 31, 2019 and 2018 (dollars in thousands): March 31, March 31, 2019 2018 Depreciation, amortization and depletion $ 4,534 $ 4,534 Interest $ 6,831 $ 7,302 The revenue associated with the Springerville Partnership lease has been eliminated in consolidation. Income, losses and cash flows of the Springerville Partnership are allocated to the general and limited partners based on their equity ownership percentages. The net income or loss attributable to the 49 percent noncontrolling equity interest in the Springerville Partnership is reflected on our consolidated statements of operations. Unconsolidated Variable Interest Entities Western Fuels Association, Inc. (“WFA”) : WFA is a non-profit membership corporation organized for the purpose of acquiring and supplying fuel resources to its members, which includes us. WFA supplies fuel to MBPP for the use of the Laramie River Station through its ownership in Western Fuels-Wyoming. We also receive coal supplies directly from WFA for the Escalante Generating Station in New Mexico. The pricing structure of the coal supply agreements with WFA is designed to recover the mine operating costs of the mine supplying the coal and therefore the coal sales agreements provide the financial support for the mine operations. There is not sufficient equity at risk for WFA to finance its activities without additional financial support. Therefore, WFA is considered a variable interest entity in which we have a variable interest. The power to direct the activities that most significantly impact WFA’s economic performance (acquiring and supplying fuel resources) is held by the members who are represented on the WFA board of directors whose actions require joint approval. Therefore, since there is shared power over the significant activities of WFA, we are not the primary beneficiary of WFA and the entity is not consolidated. Our investment in WFA, accounted for using the cost method, was $2.4 million at March 31, 2019 and December 31, 2018 and is included in investments in other associations. Western Fuels – Wyoming (“WFW”) : WFW, the owner and operator of the Dry Fork Mine in Gillette, WY, was organized for the purpose of acquiring and supplying coal, through long-term coal supply agreements, to be used in the production of electric energy at the Laramie River Station (owned by the participants of MBPP) and at the Dry Fork Station (owned by Basin). WFA owns 100 percent of the class AA shares and 75 percent of the class BB shares of WFW, while the participants of MBPP (of which we have a 27.13 percent undivided interest) own the remaining 25 percent of class BB shares of WFW. The pricing structure of the coal supply agreements is designed to recover the costs of production of the Dry Fork Mine and therefore the coal supply agreements provide the financial support for the operation of the Dry Fork Mine. There is not sufficient equity at risk at WFW for it to finance its activities without additional financial support. Therefore, WFW is considered a variable interest entity in which we have a variable interest. The power to direct the activities that most significantly impact WFW’s economic performance (which includes operations, maintenance and reclamation activities) is shared with the equity interest holders since each member has representation on the WFW board of directors whose actions require joint approval. Therefore, we are not the primary beneficiary of WFW and the entity is not consolidated. Our investment in WFW, accounted for using the cost method, was $0.1 million at March 31, 2019 and December 31, 2018 and is included in investments in other associations. Trapper Mining, Inc. (“Trapper Mining”) : Trapper Mining is a cooperative organized for the purpose of mining, selling and delivering coal from the Trapper Mine to the Craig Generating Station Units 1 and 2 through long-term coal supply agreements. Trapper Mining is jointly owned by some of the participants of the Yampa Project. We have a 26.57 percent cooperative member interest in Trapper Mining. The pricing structure of the coal supply agreements is designed to recover the costs of production of the Trapper Mine and therefore the coal supply agreements provide the financial support for the operation of the Trapper Mine. There is not sufficient equity at risk for Trapper Mining to finance its activities without the additional financial support. Therefore, Trapper Mining is considered a variable interest entity in which we have a variable interest. The power to direct the activities that most significantly impact Trapper Mining’s economic performance (which includes operations, maintenance and reclamation activities) is shared with the cooperative members since each member has representation on the Trapper Mining board of directors whose actions require joint approval. Therefore, we are not the primary beneficiary of Trapper Mining and the entity is not consolidated. We record our investment in Trapper Mining using the equity method. Our membership interest in Trapper Mining was $15.5 million at March 31, 2019 and $15.4 million at December 31, 2018.

LEGAL

LEGAL	3 Months Ended
	Mar. 31, 2019
COMMITMENTS AND CONTINGENCIES
LEGAL	NOTE 18 – LEGAL Other than as disclosed below, we do not expect any litigation or proceeding pending or threatened against us to have a material effect on our financial condition, results of operations or cash flows. Pursuant to a long-term transmission agreement with another utility, such utility pays for and has firm rights to transfer power and energy across a transmission path in Colorado. Such right to payment and obligation to provide the transfer is borne equally by us and another entity. Due to the current capacity of the transmission path, such utility’s firm rights have been curtailed. The utility disputes its obligation to pay due to the current capacity of the transmission path. We are in discussions with the utility and no litigation or arbitration has commenced. As of March 31, 2019, the utility disputes payments it has already made to us and the other entity in the aggregate amount of approximately $4 million. It is not possible to predict whether we will incur any liability in connection with this matter.

PRESENTATION OF FINANCIAL INF_2

PRESENTATION OF FINANCIAL INFORMATION (Tables)	3 Months Ended
	Mar. 31, 2019
PRESENTATION OF FINANCIAL INFORMATION
Schedule of jointly owned facilities	Our share in each jointly owned facility is as follows as of March 31, 2019 (dollars in thousands): Electric Construction Tri-State Plant in Accumulated Work In Share Service Depreciation Progress Yampa Project - Craig Generating Station Units 1 and 2 24.00 % $ 396,432 $ 241,590 $ 590 MBPP - Laramie River Station 27.13 % 427,398 297,710 56,916 Total $ 823,830 $ 539,300 $ 57,506

ACCOUNTING FOR RATE REGULATION

ACCOUNTING FOR RATE REGULATION (Tables)	3 Months Ended
	Mar. 31, 2019
ACCOUNTING FOR RATE REGULATION
Schedule of regulatory assets and liabilities	Regulatory assets and liabilities are as follows (dollars in thousands): March 31, December 31, 2019 2018 Regulatory assets Deferred income tax expense (1) $ 18,098 $ 18,098 Deferred prepaid lease expense – Springerville Unit 3 Lease (2) 85,432 86,005 Goodwill – J.M. Shafer (3) 51,282 51,994 Goodwill – Colowyo Coal (4) 37,969 38,227 Deferred debt prepayment transaction costs (5) 147,402 149,559 Deferred Holcomb expansion impairment loss (6) 93,494 93,494 Total regulatory assets 433,677 437,377 Regulatory liabilities Interest rate swap - unrealized gain (7) 4,636 8,576 Interest rate swap - realized gain (8) 4,096 4,215 Deferred revenues (9) 82,006 82,006 Membership withdrawal (10) 42,572 42,572 Total regulatory liabilities 133,310 137,369 Net regulatory asset $ 300,367 $ 300,008 (1) A regulatory asset or liability associated with deferred income taxes generally represents the future increase or decrease in income taxes payable that will be received or settled through future rate revenues. (2) Represents deferral of the loss on acquisition related to the Springerville Generating Station Unit 3 (“Springerville Unit 3”) prepaid lease expense upon acquiring a controlling interest in the Springerville Unit 3 Partnership LP (“Springerville Partnership”) in 2009. The regulatory asset for the deferred prepaid lease expense is being amortized to depreciation, amortization and depletion expense in the amount of $2.3 million annually through the 47-year period ending in 2056 and recovered from our Members in rates. (3) Represents goodwill related to our acquisition of Thermo Cogeneration Partnership, LP in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $2.8 million annually through the 25-year period ending in 2036 and recovered from our Members in rates. (4) Represents goodwill related to our acquisition of Colowyo Coal Company LP (“Colowyo Coal”) in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $1.0 million annually through the 44-year period ending in 2056 and recovered from our Members in rates. (5) Represents transaction costs that we incurred related to the prepayment of our long-term debt in 2014. These costs are being amortized to depreciation, amortization and depletion expense in the amount of $8.6 million annually over the 21-year period ending in 2035 and recovered from our Members in rates. (6) Represents deferral of the impairment loss related to development costs, including costs for the option to purchase development rights for the expansion of the Holcomb Generating Station. The plan for the recovery from our Members in rates has not been determined by our Board. Once the plan for recovery is determined, the deferred impairment loss will be recognized in other operating expenses. (7) Represents deferral of an unrealized gain related to the change in fair value of a forward starting interest rate swap that was entered into in 2016 in order to hedge interest rates on anticipated future borrowings. Upon settlement of this interest rate swap, the realized gain or loss will be deferred and subsequently recognized as interest expense when amortized over the term of the associated long-term debt borrowing. See Note 8 – Long-Term Debt. (8) Represents deferral of a realized gain of $4.6 million related to the October 2017 settlement of a forward starting interest rate swap. This realized gain was deferred as a regulatory liability and is being amortized to interest expense over the 12-year term of the First Mortgage Obligations, Series 2017A and refunded to Members through reduced rates when recognized in future periods. (9) Represents deferral of the recognition of non-member electric sales revenues. These deferred non-member electric sales revenues will be refunded to Members through reduced rates when recognized in non-member electric sales revenue in future periods. Represents the deferral of the recognition of other income recorded in connection with the withdrawal of a former Member from membership in us. This deferred membership withdrawal income will be refunded to Members through reduced rates when recognized in other income in future periods.

INVESTMENTS IN OTHER ASSOCIAT_2

INVESTMENTS IN OTHER ASSOCIATIONS (Tables)	3 Months Ended
	Mar. 31, 2019
INVESTMENTS IN OTHER ASSOCIATIONS
Schedule of investments in other associations	Investments in other associations are as follows (dollars in thousands): March 31, December 31, 2019 2018 Basin Electric Power Cooperative $ 118,115 $ 118,115 National Rural Utilities Cooperative Finance Corporation - patronage capital 11,704 11,704 National Rural Utilities Cooperative Finance Corporation - capital term certificates 15,953 16,018 CoBank, ACB 10,201 9,062 Western Fuels Association, Inc. 2,385 2,392 Other 4,052 4,196 Investments in other associations $ 162,410 $ 161,487

INVESTMENTS IN AND ADVANCES T_2

INVESTMENTS IN AND ADVANCES TO COAL MINES (Tables)	3 Months Ended
	Mar. 31, 2019
INVESTMENTS IN AND ADVANCES TO COAL MINES
Schedule of investments in and advances to coal mines	Investments in and advances to coal mines are as follows (dollars in thousands): March 31, December 31, 2019 2018 Investment in Trapper Mine $ 15,482 $ 15,350 Advances to Dry Fork Mine 2,723 3,578 Investments in and advances to coal mines $ 18,205 $ 18,928

CASH, CASH EQUIVALENTS AND RE_2

CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS (Tables)	3 Months Ended
	Mar. 31, 2019
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]
Schedule of cash, cash equivalents and restricted cash and investments	The following table provides a reconciliation of cash, cash equivalents and restricted cash and investments reported within our consolidated statements of financial position that sum to the total of the same such amount shown in our consolidated statements of cash flows (dollars in thousands): March 31, December 31, 2019 2018 Cash and cash equivalents $ 111,377 $ 116,858 Restricted cash and investments - current 140 126 Restricted cash and investments - noncurrent 13,612 10,606 Cash, cash equivalents and restricted cash and investments $ 125,129 $ 127,590

CONTRACT ASSETS AND CONTRACT _2

CONTRACT ASSETS AND CONTRACT LIABILITIES (Tables)	3 Months Ended
	Mar. 31, 2019
CONTRACT ASSETS AND CONTRACT LIABILITIES
Schedule of contract assets and liabilities	Our contract assets and liabilities consist of the following (dollars in thousands): March 31, December 31, 2019 2018 Accounts receivable - Members $ 99,303 $ 107,572 Other accounts receivable - trade: Non-member electric sales 6,669 6,998 Other 9,564 6,006 Total other accounts receivable - trade 16,233 13,004 Other accounts receivable - nontrade 10,123 9,430 Total other accounts receivable $ 26,356 $ 22,434 Contract liabilities (unearned revenue) $ 7,690 $ 7,906

OTHER DEFERRED CHARGES (Tables)

OTHER DEFERRED CHARGES (Tables)	3 Months Ended
	Mar. 31, 2019
OTHER DEFERRED CHARGES.
Schedule of Other Deferred Charges	The following other deferred charges are reflected on our consolidated statements of financial position (dollars in thousands): March 31, December 31, 2019 2018 Preliminary surveys and investigations $ 21,213 $ 20,660 Advances to operating agents of jointly owned facilities 17,628 13,161 Interest rate swap 4,636 8,576 Operating lease right-of-use assets 6,244 — Other 5,437 4,056 Total other deferred charges $ 55,158 $ 46,453

LONG-TERM DEBT (Tables)

LONG-TERM DEBT (Tables)	3 Months Ended
	Mar. 31, 2019
LONG-TERM DEBT.
Schedule of long-term debt	Long-term debt consists of the following (dollars in thousands): March 31, December 31, 2019 2018 Total debt $ 3,191,398 $ 3,227,663 Less debt issuance costs (29,211) (29,775) Less debt discounts (10,082) (10,139) Plus debt premiums 16,917 17,309 Total debt adjusted for debt issuance costs, discounts and premiums 3,169,022 3,205,058 Less current maturities (99,932) (95,757) Long-term debt $ 3,069,090 $ 3,109,301
Schedule of interest rate swap contracts	The terms of the remaining interest rate swap contract are as follows (dollars in thousands): Notional Fixed Benchmark Interest Effective Maturity Amount Rate (Pay) Rate (Receive) Date Date Interest rate swap $ 80,000 2.304 % 30 year - LIBOR June 2019 June 2049

SHORT-TERM BORROWINGS (Tables)

SHORT-TERM BORROWINGS (Tables)	3 Months Ended
	Mar. 31, 2019
SHORT-TERM BORROWINGS
Schedule of commercial paper	Commercial paper consisted of the following (dollars in thousands): March 31, December 31, 2019 2018 Commercial paper outstanding, net of discounts $ 224,208 $ 204,145 Weighted average interest rate 2.69 % 2.65 %

ASSET RETIREMENT OBLIGATIONS (T

ASSET RETIREMENT OBLIGATIONS (Tables)	3 Months Ended
	Mar. 31, 2019
ASSET RETIREMENT OBLIGATION
Schedule of Asset Retirement Obligations	Aggregate carrying amounts of asset retirement obligations are as follows (dollars in thousands): Three Months Ended March 31, 2019 Asset retirement obligations at beginning of period $ 56,772 Liabilities incurred 9,900 Liabilities settled (146) Accretion expense 638 Change in cash flow estimate — Total asset retirement obligations at end of period $ 67,164 Less current asset retirement obligations at end of period (2,156) Long-term asset retirement obligations at end of period $ 65,008

OTHER DEFERRED CREDITS AND OT_2

OTHER DEFERRED CREDITS AND OTHER LIABILITIES (Tables)	3 Months Ended
	Mar. 31, 2019
OTHER DEFERRED CREDITS AND OTHER LIABILITIES
Schedule of other deferred credits and other liabilities	The following other deferred credits and other liabilities are reflected on our consolidated statements of financial position (dollars in thousands): March 31, December 31, 2019 2018 Transmission easements $ 20,772 $ 20,966 Operating lease liabilities - noncurrent 1,823 — Contract liabilities (unearned revenue) - noncurrent 4,498 4,592 Customer deposits 2,597 2,458 Other 20,230 22,250 Total other deferred credits and other liabilities $ 49,920 $ 50,266

EMPLOYEE BENEFIT PLANS (Tables)

EMPLOYEE BENEFIT PLANS (Tables)	3 Months Ended
	Mar. 31, 2019
EMPLOYEE BENEFIT PLANS
Schedule of the postretirement medical benefit and postemployment medical benefit obligations	The postretirement medical benefit and postemployment medical benefit obligations are determined annually (during the fourth quarter) by an independent actuary and are included in accumulated postretirement benefit and postemployment obligations on our consolidated statements of financial position as follows (dollars in thousands): March 31, 2019 Postretirement medical benefit obligation at beginning of period $ 8,556 Service cost 169 Interest cost 72 Benefit payments (net of contributions by participants) (132) Postretirement medical benefit obligation at end of period $ 8,665 Postemployment medical benefit obligation at end of period 371 Total postretirement and postemployment medical obligations at end of period $ 9,036
Schedule of the net unrecognized actuarial gains and losses related to the postretirement medical benefit obligation that are included in accumulated other comprehensive income	The net unrecognized actuarial gains and losses related to the postretirement medical benefit obligations are included in accumulated other comprehensive income as follows (dollars in thousands): March 31, 2019 Amounts included in accumulated other comprehensive income at beginning of period $ 375 Amortization of prior service credit into other income (20) Amounts included in accumulated other comprehensive income at end of period $ 355

REVENUE (Tables)

REVENUE (Tables)	3 Months Ended
	Mar. 31, 2019
REVENUE
Schedule of revenue from contracts with non-member customers and other operating revenue	In addition to our Member electric sales, we have non-member electric sales and other operating revenue which consist of several revenue streams. The following revenue is reflected on our consolidated statements of operations as follows (dollars in thousands): Three Months Ended March 31, 2019 2018 Non-member electric sales: Long-term contracts $ 11,682 $ 11,943 Short-term contracts 15,048 4,919 Other 14,256 12,300 Total non-member electric sales and other operating revenue $ 40,986 $ 29,162

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Mar. 31, 2019
LEASES
Schedule of lease components	Our consolidated statements of financial position include the following lease components (dollars in thousands): March 31, 2019 Operating leases Operating lease right-of-use assets $ 7,564 Less: Accumulated amortization (1,320) Net operating lease right-of-use assets $ 6,244 Operating lease liabilities - current $ 4,970 Operating lease liabilities - noncurrent 1,823 Total operating lease liabilities $ 6,793 Operating leases Weighted average remaining lease term (years) Weighted average discount rate
Schedule of expected minimum lease commitments under operating leases	Future expected minimum lease commitments under operating leases are as follows (dollars in thousands): 2019 $ 5,199 2020 459 2021 360 2022 229 2023 172 Thereafter 985 Total lease payments $ 7,404 Less imputed interest (611) Total $ 6,793

FAIR VALUE (Tables)

FAIR VALUE (Tables)	3 Months Ended
	Mar. 31, 2019
Marketable securities
FAIR VALUE
Schedule of carrying amounts and fair values of assets and liabilities	The cost and fair values of our marketable securities are as follows (dollars in thousands): As of March 31, 2019 As of December 31, 2018 Estimated Estimated Cost Fair Value Cost Fair Value Marketable securities $ 571 $ 537 $ 818 $ 712
Debt
FAIR VALUE
Schedule of carrying amounts and fair values of assets and liabilities	The principal amounts and fair values of our debt are as follows (dollars in thousands): As of March 31, 2019 As of December 31, 2018 Principal Estimated Principal Estimated Amount Fair Value Amount Fair Value Total debt $ 3,191,398 $ 3,480,702 $ 3,227,663 $ 3,421,753

VARIABLE INTEREST ENTITIES (Tab

VARIABLE INTEREST ENTITIES (Tables)	3 Months Ended
	Mar. 31, 2019
VARIABLE INTEREST ENTITIES
Schedule of consolidated variable interest entities	Assets and liabilities of the Springerville Partnership that are included in our consolidated statements of financial position are as follows (dollars in thousands): March 31, December 31, 2019 2018 Net electric plant $ 790,014 $ 794,549 Noncontrolling interest $ 109,732 $ 110,169 Long-term debt $ 381,914 $ 416,057 Accrued interest $ 4,420 $ 12,056 Our consolidated statements of operations include the following Springerville Partnership expenses for the three months ended March 31, 2019 and 2018 (dollars in thousands): March 31, March 31, 2019 2018 Depreciation, amortization and depletion $ 4,534 $ 4,534 Interest $ 6,831 $ 7,302

PRESENTATION OF FINANCIAL INF_3

PRESENTATION OF FINANCIAL INFORMATION - Jointly Owned Facilities (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)facility
Jointly owned facilities
Number of jointly owned facilities | facility	2
Electric plant in service	$ 823,830
Accumulated depreciation	539,300
Construction work in progress	$ 57,506
Yampa
Jointly owned facilities
Tri-State share (as a percent)	24.00%
Electric plant in service	$ 396,432
Accumulated depreciation	241,590
Construction work in progress	$ 590
MBPP
Jointly owned facilities
Tri-State share (as a percent)	27.13%
Electric plant in service	$ 427,398
Accumulated depreciation	297,710
Construction work in progress	$ 56,916

ACCOUNTING FOR RATE REGULATIO_2

ACCOUNTING FOR RATE REGULATION (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Oct. 31, 2017	Mar. 31, 2019	Dec. 31, 2018
Regulatory assets and liabilities
Regulatory assets		$ 433,677	$ 437,377
Regulatory liabilities		133,310	137,369
Net regulatory asset		300,367	300,008
Interest rate swap - unrealized gain
Regulatory assets and liabilities
Regulatory liabilities		4,636	8,576
Interest rate swaps, realized gain
Regulatory assets and liabilities
Regulatory liabilities		4,096	4,215
Proceeds from settlement of interest rate swaps	$ 4,600
Deferred non-member electric sales
Regulatory assets and liabilities
Regulatory liabilities		82,006	82,006
Deferred revenue from membership withdrawal
Regulatory assets and liabilities
Regulatory liabilities		42,572	42,572
Deferred income tax expense
Regulatory assets and liabilities
Regulatory assets		18,098	18,098
Deferred prepaid lease expense | Springerville Unit 3 Lease
Regulatory assets and liabilities
Regulatory assets		85,432	86,005
Annual amortization expense		$ 2,300
Amortization period		47 years
Goodwill | TCP
Regulatory assets and liabilities
Regulatory assets		$ 51,282	51,994
Annual amortization expense		$ 2,800
Amortization period		25 years
Goodwill | Colowyo Coal
Regulatory assets and liabilities
Regulatory assets		$ 37,969	38,227
Annual amortization expense		$ 1,000
Amortization period		44 years
Deferred debt prepayment transaction costs
Regulatory assets and liabilities
Regulatory assets		$ 147,402	149,559
Annual amortization expense		$ 8,600
Amortization period		21 years
Holcomb Expansion | Deferred impairment loss
Regulatory assets and liabilities
Regulatory assets		$ 93,494	$ 93,494
First Mortgage Obligations, Series 2017A , Tranche 1, 3.34%, due through 2029
Regulatory assets and liabilities
Term of issuance		12 years

INVESTMENTS IN OTHER ASSOCIAT_3

INVESTMENTS IN OTHER ASSOCIATIONS (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Investment in other associations
Investment in other associations	$ 162,410	$ 161,487
Impairment during the period	0	0
Basin Electric Power Cooperative
Investment in other associations
Investment in other associations	118,115	118,115
National Rural Utilities Cooperative Finance Corporation - patronage capital
Investment in other associations
Investment in other associations	11,704	11,704
National Rural Utilities Cooperative Finance Corporation - capital term certificates
Investment in other associations
Investment in other associations	15,953	16,018
CoBank, ACB
Investment in other associations
Investment in other associations	10,201	9,062
Western Fuels Association
Investment in other associations
Investment in other associations	2,385	2,392
Other
Investment in other associations
Investment in other associations	$ 4,052	$ 4,196

INVESTMENTS IN AND ADVANCES T_3

INVESTMENTS IN AND ADVANCES TO COAL MINES (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Investments in and advances to coal mines
Investments in and advances to coal mines	$ 18,205	$ 18,928
Trapper Mining
Investments in and advances to coal mines
Investment in coal mine	15,482	15,350
Dry Fork Mine
Investments in and advances to coal mines
Advances	$ 2,723	$ 3,578

CASH, CASH EQUIVALENTS AND RE_3

CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018	Mar. 31, 2018	Dec. 31, 2017
Cash, cash equivalents, restricted cash and investments
Cash and cash equivalents	$ 111,377	$ 116,858
Restricted cash and investments - current	140	126
Restricted cash and investments - noncurrent	13,612	10,606
Cash, cash equivalents and restricted cash and investments	125,129	127,590	$ 123,991	$ 150,965
Internally restricted cash	$ 7,600	$ 4,600

CONTRACT ASSETS AND CONTRACT _3

CONTRACT ASSETS AND CONTRACT LIABILITIES (Details) - USD ($) $ in Thousands	Apr. 11, 2019	Mar. 31, 2019	Dec. 31, 2018
Contract assets
Contract assets		$ 0	$ 0
Accounts receivable
Accounts receivable—Members		99,303	107,572
Other accounts receivable		26,356	22,434
Proceeds from insurance settlement	$ 6,300
Contract liabilities
Contract liabilities (unearned revenue)		7,690	7,906
Other accounts receivable - trade
Accounts receivable
Other accounts receivable		16,233	13,004
Insurance settlement receivable		6,300	6,300
Other accounts receivable - trade | Non-member electric sales
Accounts receivable
Other accounts receivable		6,669	6,998
Other accounts receivable - trade | Other
Accounts receivable
Other accounts receivable		9,564	6,006
Other accounts receivable, non-trade
Accounts receivable
Other accounts receivable		10,123	$ 9,430
Other operating revenue
Contract liabilities
Contract liabilities recognized		$ 200

OTHER DEFERRED CHARGES (Details

OTHER DEFERRED CHARGES (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016instrument	Mar. 31, 2019USD ($)	Dec. 31, 2018USD ($)
Other deferred charges
Regulatory liabilities		$ 133,310	$ 137,369
Preliminary surveys and investigations		21,213	20,660
Advances to operating agents of jointly owned facilities		17,628	13,161
Interest rate swap		4,636	8,576
Operating lease right-of-use assets		6,244
Other		5,437	4,056
Total other deferred charges		55,158	46,453
Interest rate swap - unrealized gain
Other deferred charges
Regulatory liabilities		$ 4,636	$ 8,576
Interest rate swaps
Other deferred charges
Number of instruments entered into | instrument	1

LONG-TERM DEBT - Other Informat

LONG-TERM DEBT - Other Information (Details) $ in Thousands	Apr. 04, 2019USD ($)	Mar. 31, 2019USD ($)instrument	Dec. 31, 2018USD ($)	Dec. 11, 2018USD ($)
Debt
Long-term debt		$ 3,069,090	$ 3,109,301
Unsecured debt
Number of unsecured debt instruments | instrument		1
Unsecured notes		$ 32,600
Credit facility information
Outstanding borrowings		3,191,398	$ 3,227,663
2018 Revolving Credit Agreement
Credit facility information
Maximum borrowing capacity		650,000
Available borrowing capacity		425,000
Outstanding borrowings		0
2018 Revolving Credit Agreement | Commercial Paper
Credit facility information
Available borrowing capacity		275,000
2018 Term Loan Agreement
Credit facility information
Funds used to refinance an existing term loan	$ 55,200
2018 Term Loan Agreement | First Mortgage Obligations, Series 2018B
Credit facility information
Maximum borrowing capacity				$ 55,200
Outstanding borrowings		55,200
2018 Term Loan Agreement | Variable Rate Borrowings, Due Through 2038
Credit facility information
Maximum borrowing capacity				$ 69,800
Outstanding borrowings		$ 34,900
Proceeds from debt draw	$ 34,900

LONG-TERM DEBT - Components (De

LONG-TERM DEBT - Components (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Long-term debt, components
Total debt	$ 3,191,398	$ 3,227,663
Less debt issuance costs	(29,211)	(29,775)
Less debt discounts	(10,082)	(10,139)
Plus debt premiums	16,917	17,309
Total debt adjusted for debt issuance costs, discounts and premiums	3,169,022	3,205,058
Less current maturities	(99,932)	(95,757)
Long-term debt	$ 3,069,090	$ 3,109,301

LONG-TERM DEBT - Interest Rate

LONG-TERM DEBT - Interest Rate Swaps (Details) - Interest Rate Swap - June 2016 $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)
Interest rate swaps
Notional Amount	$ 80,000
Fixed Rate	2.304%
Benchmark Interest Rate	30 year - LIBOR
Effective Date	Jun. 1, 2019
Maturity Date	Jun. 1, 2049

SHORT-TERM BORROWINGS (Details)

SHORT-TERM BORROWINGS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Short-term borrowings
Amount outstanding	$ 224,208	$ 204,145
Commercial Paper
Short-term borrowings
Maximum amount per commercial paper sublimit	500,000
Amount outstanding	$ 224,208	$ 204,145
Weighted average interest rate	2.69%	2.65%
Commercial Paper | Maximum
Short-term borrowings
Term of issuance	397 days
2018 Revolving Credit Agreement
Short-term borrowings
Available borrowing capacity	$ 425,000
2018 Revolving Credit Agreement | Commercial Paper
Short-term borrowings
Available borrowing capacity	$ 275,000

ASSET RETIREMENT OBLIGATIONS (D

ASSET RETIREMENT OBLIGATIONS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Aggregate carrying amounts of asset retirement obligations
Asset retirement obligation at beginning of period	$ 56,772
Liabilities incurred	9,900
Liabilities settled	(146)
Accretion expense	638
Asset retirement obligation at end of period	67,164
Less current asset retirement obligations	(2,156)	$ (2,183)
Long-term asset retirement obligations at end of period	65,008	$ 54,589
New Horizon Mine
Aggregate carrying amounts of asset retirement obligations
Liabilities incurred	$ 9,900

OTHER DEFERRED CREDITS AND OT_3

OTHER DEFERRED CREDITS AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Deferred credits and other liabilities
Transmission easements	$ 20,772	$ 20,966
Operating lease liabilities - noncurrent	1,823
Contract liabilities (unearned revenue) - noncurrent	4,498	4,592
Customer deposits	2,597	2,458
Other	20,230	22,250
Total other deferred credits and other liabilities	49,920	50,266
Transmission Right of Way Easements
Deferred credits and other liabilities
Total due for easement right of way	31,900
Other Deferred Credits and Other Liabilities | Transmission Right of Way Easements
Deferred credits and other liabilities
Transmission easements	$ 20,800	$ 21,000

EMPLOYEE BENEFIT PLANS - Postre

EMPLOYEE BENEFIT PLANS - Postretirement Benefits Other Than Pensions, Plans, Amendments and Obligations (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)plan
Postretirement medical benefit and postemployment medical benefit obligations
Threshold percentage, unrecognized amount of actuarial gains and losses as a percentage of projected benefit obligation	10.00%
Medical Plans
Postretirement medical benefit and postemployment medical benefit obligations
Total postretirement and/or postemployment medical obligations at end of period	$ 9,036
Postretirement Medical Benefit Plans
Postretirement medical benefit and postemployment medical benefit obligations
Postretirement medical benefit obligation at beginning of year	8,556
Service cost	169
Interest cost	72
Benefit payments (net of contributions by participants)	(132)
Total postretirement and/or postemployment medical obligations at end of period	8,665
Postemployment Medical Benefit Plans
Postretirement medical benefit and postemployment medical benefit obligations
Total postretirement and/or postemployment medical obligations at end of period	$ 371
Non-bargaining unit employees | Medical Plans
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
Number of plans | plan	3
Non-bargaining unit employees | Medical Plans | Maximum
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
Qualifying age	65 years
Non-bargaining unit employees | Postretirement Medical Benefit Plans
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
Number of plans | plan	2
Non-bargaining unit employees | Postretirement Medical Benefit Plans | Minimum
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
Qualifying age	55 years
Non-bargaining unit employees | Postemployment Medical Benefit Plans
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
Number of plans | plan	3

EMPLOYEE BENEFIT PLANS - Post_2

EMPLOYEE BENEFIT PLANS - Postretirement Benefits Other Than Pensions, Actuarial Gains and Losses, and Assumptions (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)
Net unrecognized actuarial gains and losses related to the postretirement medical benefit obligation are included in accumulated other comprehensive income
Amounts included in accumulated other comprehensive income at beginning of period	$ 375
Amortization of prior service cost	(20)
Amounts included in accumulated other comprehensive income at end of period	355
Executive benefit restoration obligation included in accumulated postretirement benefit and postemployment obligations	$ 600

REVENUE - Member (Details)

REVENUE - Member (Details)	3 Months Ended
	Mar. 31, 2019customer
Member Contracts Extending Through 2050
Member electric sales
Number of contracts	42
Member Contracts Extending Through 2040
Member electric sales
Number of contracts	1

REVENUE - Non-member (Details)

REVENUE - Non-member (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Disaggregation of revenue
Other	$ 14,256	$ 12,300
Revenues	339,917	318,508
Non-member electric sales and other operating revenue
Disaggregation of revenue
Revenues	40,986	29,162
Non-member electric sales
Disaggregation of revenue
Revenue from contract with customer	26,730	16,862
Non-member electric sales | Long-term contracts
Disaggregation of revenue
Revenue from contract with customer	11,682	11,943
Non-member electric sales | Short-term contracts
Disaggregation of revenue
Revenue from contract with customer	15,048	4,919
Other
Disaggregation of revenue
Other	$ 14,256	$ 12,300

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
INCOME TAXES
Income tax benefit	$ 77	$ 151

LEASES - Leasing Arrangements a

LEASES - Leasing Arrangements as Lessee (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)leaseMW	Mar. 31, 2018USD ($)
Lease expenses
Operating lease expense	$ 1,800
Rent expense		$ 2,000
Number of financing leases | lease	0
Lessee operating lease assets and liabilities
Operating lease right-of-use assets, gross	$ 7,564
Less: Accumulated amortization	(1,320)
Net operating lease right-of-use assets	$ 6,244
Operating lease right-of-use asset, Statement of Financial Position line item	us-gaap:DeferredCostsCurrentAndNoncurrent
Operating lease liabilities - current	$ 4,970
Operating lease liabilities - current, Statement of Financial Position line item	us-gaap:LiabilitiesCurrent
Operating lease liabilities - noncurrent	$ 1,823
Operating lease liabilities - noncurrent, Statement of Financial Position line item	tris:DeferredCreditsRegulatoryLiabilitiesAndOtherLiabilities
Total operating lease liabilities	$ 6,793
Weighted average remaining lease term (years)	3 years 4 months 2 days
Weighted average discount rate	6.91%
Brush Generating Station
Operating Lease - Lessee
Megawatt usage | MW	70
Term of agreement	10 years

LEASES - Future Minimum Lease C

LEASES - Future Minimum Lease Commitments (Details) $ in Thousands	Mar. 31, 2019USD ($)
Future expected minimum lease commitments under operating leases
2019	$ 5,199
2020	459
2021	360
2022	229
2023	172
Thereafter	985
Total lease payments	7,404
Less imputed interest	(611)
Total	$ 6,793

LEASES - Leasing Arrangements_2

LEASES - Leasing Arrangements as Lessor (Details) $ in Millions	3 Months Ended
	Mar. 31, 2019USD ($)MW	Mar. 31, 2018USD ($)
Lease revenue | $	$ 4.3
Lease revenues | $		$ 4.6
J. M. Shafer Generating Station
Megawatt usage | MW	272
J. M. Shafer Generating Station | Third Party
Megawatt usage | MW	122

FAIR VALUE (Details)

FAIR VALUE (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016instrument	Mar. 31, 2019USD ($)	Dec. 31, 2018USD ($)
Fair value:
Regulatory liabilities		$ 133,310	$ 137,369
Principal Amount
Fair value:
Marketable securities		571	818
Long-term debt		3,191,398	3,227,663
Estimated Fair Value
Fair value:
Cash and cash equivalents		102,300	107,200
Estimated Fair Value | Level 2
Fair value:
Long-term debt		3,480,702	3,421,753
Estimated Fair Value | Recurring | Level 1
Fair value:
Marketable securities		537	712
Interest rate swap - unrealized gain
Fair value:
Regulatory liabilities		$ 4,636	$ 8,576
Interest rate swaps
Fair value:
Number of instruments entered into | instrument	1

VARIABLE INTEREST ENTITIES - Co

VARIABLE INTEREST ENTITIES - Consolidated Entities (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Consolidated Variable Interest Entities
Interest expense	$ 38,281	$ 38,021
Springerville Partnership
Consolidated Variable Interest Entities
Depreciation and amortization	4,534		$ 4,534
Interest expense	6,831		7,302
Springerville Partnership | Electric Plant
Consolidated Variable Interest Entities
Assets of variable interest entity included in consolidated statements of financial position	790,014		794,549
Springerville Partnership | Noncontrolling interest
Consolidated Variable Interest Entities
Assets of variable interest entity included in consolidated statements of financial position	109,732		110,169
Springerville Partnership | Long-term debt
Consolidated Variable Interest Entities
Assets of variable interest entity included in consolidated statements of financial position	381,914		416,057
Springerville Partnership | Accrued Interest
Consolidated Variable Interest Entities
Assets of variable interest entity included in consolidated statements of financial position	$ 4,420		$ 12,056
Springerville Partnership | Springerville Partnership
Consolidated Variable Interest Entities
Equity interest (as a percent)	51.00%
General partner interest (as a percent)	1.00%
Springerville Partnership | Springerville Unit 3 Holding LLC
Consolidated Variable Interest Entities
Ownership interest held by parent (as a percent)	100.00%
Springerville Partnership | Springerville Partnership | Springerville Unit 3 Lease
Consolidated Variable Interest Entities
Percentage of financial and other support provided	100.00%
Other Limited Partners | Springerville Partnership
Consolidated Variable Interest Entities
Ownership interest held by noncontrolling interest (as a percent)	49.00%

VARIABLE INTEREST ENTITIES - Un

VARIABLE INTEREST ENTITIES - Unconsolidated Entities (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Unconsolidated Variable Interest Entities
Investments in other associations	$ 162,410	$ 161,487
Western Fuels Association | Unconsolidated Variable Interest Entity - not primary beneficiary | Investments in other associations
Unconsolidated Variable Interest Entities
Investments in other associations	2,400	2,400
WFW | Unconsolidated Variable Interest Entity - not primary beneficiary | Investments in other associations
Unconsolidated Variable Interest Entities
Investments in other associations	$ 100	100
MBPP
Unconsolidated Variable Interest Entities
Tri-State share (as a percent)	27.13%
WFW | Western Fuels Association | Class AA shares
Unconsolidated Variable Interest Entities
Ownership interest held by parent (as a percent)	100.00%
WFW | Western Fuels Association | Class BB Shares
Unconsolidated Variable Interest Entities
Ownership interest held by parent (as a percent)	75.00%
WFW | MBPP | Class BB Shares
Unconsolidated Variable Interest Entities
Ownership interest held by noncontrolling interest (as a percent)	25.00%
MBPP | Unconsolidated Variable Interest Entity - not primary beneficiary
Unconsolidated Variable Interest Entities
Tri-State share (as a percent)	27.13%
Trapper Mining | Unconsolidated Variable Interest Entity - not primary beneficiary
Unconsolidated Variable Interest Entities
Investment in coal mine	$ 15,500	$ 15,400
Tri-State share (as a percent)	26.57%

LEGAL - Other Legal (Details)

LEGAL - Other Legal (Details) $ in Millions	3 Months Ended
	Mar. 31, 2019USD ($)
Another utility company
Aggregate payments disputed by payor to the entity and another entity under a long-term transmission agreement	$ 4