Bustamante stays in charge at co-op

Members of Socorro Electric Cooperative District 2 voted to retain Paul Bustamante as the district’s representative on the board of trustees during a special meeting at Midway Elementary School on Wednesday.

Bustamante, who is also the co-op president, received 82 votes, while there were 61 votes cast to have him removed.
“The people spoke,” Bustamante said between receiving congratulations from supporters. “I’m glad it’s over with.”
The special meeting was called when a petition signed by approximately 80 District 2 members was turned in last November charging Bustamante with breach of fiduciary duty and no confidence.
Richard “Arf” Epstein of Pueblitos led the petition drive and stated the case against Bustamante at the special meeting.
Though disappointed with the result, Epstein said he hoped some good would come from it.
“An election isn’t about just winning,” he said, “it’s about educating people.”
During his 10-minute presentation, Epstein went over some facts that he said supported his claim that Bustamante had breached his fiduciary duty.
He started by saying that the publicly owned non-profit corporation lost $417,000 in 2009. That same year, the 11-member board of trustees incurred $492,000 in expenses.
The co-op lost another $217,000 in 2010, he said, “but we have no idea how much the trustees got.”
Epstein said he requested an itemized list of trustees’ expenses from 2010 from the co-op, but despite a bylaw that allows the inspection of records his request was denied. He said he obtained the data through a Freedom of Information request to the USDA Rural Utilities Service.
Epstein then referred to the lawsuit the co-op filed against all of its approximately 10,000 member-owners last summer. The lawsuit was an effort to block three newly adopted bylaws aimed at increasing transparency of governance.
“The trustees sued you,” Epstein said. “Each and every one of you has been sued to keep what they are doing secret.”
Epstein said the co-op lost a substantial amount of money the past two years and the trustees have a duty to inform the members how their money is being spent.
A rate increase that will go into effect next month will cost the average customer $100 more per year, Espstein said, and that’s because the board of trustees refused to take steps to economize after 2009. As president of the co-op, Bustamante should have done something to curb the spending but did not, he said.
“The question is: do you have confidence in Mr. Bustamante leading the co-op when the co-op is losing money and has to make up a large sum with a rate increase?” Epstein asked in summary.
Then it was Bustamante’s turn to speak. He started by saying that the co-op missed its profit margins, partly due to overcharges that had to be paid back.
“As far as expenditures, I think the members took action on that,” he said, referring to a bylaw passed at the annual meeting last April that limited each trustees’ expenditures to $10,000 per year — $15,000 for the co-op president. “A lot of that is insurance. The other part is travel, reimbursements and per diem.”
Bustamante admitted the lawsuit the co-op filed against its members was a mistake, “but now you’ve got attorneys out there who don’t want to let it go.” He then blamed District 5 trustee Charlie Wagner, a leader in the movement to reform the co-op, for the co-op’s legal issues.
Wagner is named as the representative of the class of member-owners in a countersuit against the co-op that requests class-action certification.
Bustamante disputed Epstein’s claim that the co-op was concealing information and trying to keep things secret. He said information is always available at co-op board meetings.
“There’s nothing to hide; there’s no secrets,” he said.
Bustamante also touched on the rate increase, saying the co-op hasn’t raised rates since 1997. He also said the co-op saved hundreds of thousands of dollars by drafting a plan to realign districts in-house.
That plan is up for approval at the annual meeting on April 9.
“I’ve done business in the community. I’ve been honest. I never took anything that wasn’t mine,” he said in closing.
Because the meeting started 35 minutes late so those standing in line could register, there was some discussion from the floor that the vote to retain or remove Bustamante be taken by a show of hands. That drew objection from Epstein and some of his supporters.
Epstein pointed out that the notice of the meeting stated the vote would be conducted by secret ballot and added that some people would feel intimidated by being forced to vote in public.
Dennis Francish, the co-op’s attorney who was selected as chairman of the meeting, agreed with Epstein.
“I think we should follow the procedure,” he said. “Let’s stay within the rules.”
The voting took about 40 minutes to complete. When Francish announced the results, Bustamante’s supporters let out a cheer.
Approximately 22 percent of eligible voters in District 2 turned out for the special meeting. Five more votes were cast than in 2008 when Bustamante won re-election. He defeated Epstein in that election, 87-50.