8. MEMBERSHIP INTERESTS

Cash Distributions

Distributions are limited by our required regulatory capital structure to be at or below the assumed debt-to-equity ratio established by the PUCT for ratemaking purposes, which is currently set at 60% debt to 40% equity. At June 30, 2015, $68 million was available for distribution to our members as our regulatory capitalization ratio was 59.6% debt and 40.4% equity. The PUCT has the authority to determine what types of debt and equity are included in a utility’s debt-to-equity ratio. For purposes of this ratio, debt is calculated as long-term debt plus unamortized gains on reacquired debt less unamortized issuance expenses, premiums and losses on reacquired debt. The debt calculation excludes transition bonds issued by Bondco. Equity is calculated as membership interests determined in accordance with US GAAP, excluding the effects of purchase accounting (which included recording the initial goodwill and fair value adjustments and the subsequent related impairments and amortization).

On July 29, 2015, our board of directors declared a cash distribution between $110 million and $120 million, to be paid to our members in August 2015 with the exact amount to be determined by management using estimated earnings through July 31, 2015. During the six months ended June 30, 2015, our board of directors declared, and we paid the following cash distributions to our members:


Declaration Date	Payment Date	Amount
April 29, 2015	May 15, 2015	$	65
February 25, 2015	February 26, 2015	$	100

Membership Interests

The following tables present the changes to membership interests during the six months ended June 30, 2015 and 2014:


	Capital Accounts		Accumulated Other Comprehensive Income (Loss)		Total Membership Interests

Balance at December 31, 2014	$	7,625	$	(107)	$	7,518
Net income		196		-		196
Distributions		(165)		-		(165)
Net effects of cash flow hedges (net of tax)		-		1		1
Defined benefit pension plans (net of tax)		-		1		1
Balance at June 30, 2015	$	7,656	$	(105)	$	7,551

	Capital Accounts		Accumulated Other Comprehensive Income (Loss)		Total Membership Interests

Balance at December 31, 2013	$	7,457	$	(48)	$	7,409
Net income		197		-		197
Distributions		(110)		-		(110)
Net effects of cash flow hedges (net of tax)		-		1		1
Balance at June 30, 2014	$	7,544	$	(47)	$	7,497

Accumulated Other Comprehensive Income (Loss)

The following tables present the changes to accumulated other comprehensive income (loss) for the six months ended June 30, 2015 and 2014:


	Cash Flow Hedges – Interest Rate Swap		Defined Benefit Pension and OPEB Plans		Accumulated Other Comprehensive Income (Loss)

Balance at December 31, 2014	$	(24)	$	(83)	$	(107)
Defined benefit pension plans (net of tax)		-		1		1
Amounts reclassified from accumulated other comprehensive income (loss) and reported in interest expense and related charges		1		-		1
Balance at June 30, 2015	$	(23)	$	(82)	$	(105)

	Cash Flow Hedges – Interest Rate Swap		Defined Benefit Pension and OPEB Plans		Accumulated Other Comprehensive Income (Loss)

Balance at December 31, 2013	$	(26)	$	(22)	$	(48)
Defined benefit pension plans (net of tax)		-		-		-
Amounts reclassified from accumulated other comprehensive income (loss) and reported in interest expense and related charges		1		-		1
Balance at June 30, 2014	$	(25)	$	(22)	$	(47)