Co-op Reform Group plans tailgate party

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Tailgating is an activity typically held before football or baseball games. But this Saturday, a group of reform-minded folks are planning to hold a tailgate party in the parking lot of Macey Center prior to Socorro Electric Cooperative’s annual meeting.

“The idea is to attract as many voters as possible to the meeting to avoid lack of quorum,” said Herb Myers, a co-op member who is in charge of planning the event. “A number of us talked about what we could do, particularly to attract out-of-town voters, and thought we’d make it fun by having a tailgate and give them information about what the issues are prior to the voting.”

The tailgating party, scheduled to begin at 1:30 p.m. and continue until the meeting begins at 3 p.m., is sponsored by the Socorro Electric Cooperative Reform Group, so the information served up is likely to be garnished just one way.

The group is encouraging members to vote against all the resolutions being presented this year, except one that realigns districts — something members voted in favor of two years ago.

In addition to talking about the issues, “We’ll offer hot dogs, mustard and relish and popcorn,” Myers said. “It’s all free. We’re inviting everybody else to bring their own drinks or a side dish, maybe some chile. We have a limited number of tables, so we’re asking people to bring chairs.”

Socorro Electric used to provide hot dogs and doughnuts at the annual meeting, but cut back its refreshments budget a few years ago.

Myers said members of the reform group took it upon themselves to reach into their own pockets to help pay for the hot dogs and popcorn. Others made phone calls.

“We raised $300 within the first 20 minutes,” said Charlene West, who serves as chairperson of the reform group, “and people are still sending money.”

West said it’s not just people who are part of the reform group. She’s heard about other people not formally associated with the group who have printed up fliers and are distributing them in their neighborhoods.

“That’s not us; it’s people doing it on their own,” she said. “I think it’s fantastic that people are doing that. It’s people moving and people talking. It’s growing by leaps and bounds.”

Co-op President Paul Bustamante did not immediately return a phone call on Tuesday, but Socorro Electric issued a press release on Monday that also encouraged members to attend the annual meeting.

“To have an efficient and effective discussion at the Annual Meeting and to ensure a fair democratic process, depends on good communication and full access to the Board’s reasoning behind the amendments to the by-laws,” the press release reads.

The board published the changes they’re proposing and explanations for doing so in this month’s Enchantment magazine. They are also posted on the co-op’s website, www.socorroelectric.com.

The press release says that General Manager Joseph Herrera can be contacted for information on the agenda or the proposed bylaws and lists the phone number 575-835-0560.

The Rise of Reform

The co-op reform movement took rise in 2008 when an Albuquerque Journal reporter did a story, also published in El Defensor Chieftain, comparing expenses incurred by boards of trustees of rural electric cooperatives throughout the state. It revealed Socorro Electric’s trustees were compensated $275,178 in 2006 — about $118,000 more than any of the other 15 co-ops that operate in the state.

Socorro Electric trustees’ compensation, which included expenses for travel per diem and insurance, increased to $492,000 in 2009. That year, member-owners of the democratically controlled co-op, poised to introduce changes at the annual meeting, were thwarted in their effort to initiate reform when one trustee killed the meeting by disputing the presence of a quorum.

Later that year, three longstanding trustees were ousted in district elections in Socorro, and Trustee Charlie Wagner, a leader in the reform movement, won re-election at the district meeting in Magdalena.

The reform movement’s momentum continued to pick up steam when members overwhelmingly passed a bevy of new bylaws bent on change at the 2010 annual meeting. The board continued to fight reform by challenging three new bylaws that called for increased transparency. In order to do so, the co-op took the unprecedented step of suing its members — a lawsuit it eventually lost.

In the meantime, numerous other circumstances came to light that did not reflect well on Socorro Electric management. The co-op fell into technical default on federal loans; two managers were fired in wake of an investigation into financial irregularities, which led to several lawsuits being filed against the co-op; and it was discovered that customers had been overcharged about $1.8 million over a period of five years.

Some of the reform measures have taken hold. After the judge ruled against the co-op in May 2011, Socorro Electric has begun to follow the Open Meetings Act, patronage capital is being reported to members and checks have been issued, and board expenses have been reduced to $105,000 per year.

But several of the new measures, such as reducing the size of the board from 11 to five and realignment of districts, have yet to take effect.

And some of the board-sponsored resolutions being introduced at this year’s annual meeting effectively set out to undo what members voted for in 2010.

That has riled up members once again.

“Our greatest concern is that we haven’t been able to enact the changes we voted in a few years ago and the court affirmed,” Myers said.

“If they (the board of trustees) would have followed all the bylaws members proposed, the co-op would be in much better shape,” West said. “It’s going on five years we’ve been fighting this, and it shouldn’t be a fight … The only side there should be in this is the members’ side.”

Distrustful of Trustees

Count Sherman Yates as another member upset with the co-op’s board for, what he says, is its lack of willingness to go along with the members’ wishes.

“It sounds to me like they’re just trying to undermine the members and undo what we did at the last meeting,” Yates said. “I hate to say it, but I have absolutely no faith in the board right now.”

While members voted to reduce the size of the board in 2010, that hasn’t happened yet. Trustees are being allowed to serve out their terms and none of them have expired since then.

Now, citing that only one other co-op in the state has a board of as few as five members, trustees are proposing a seven-member board, adding two at-large members.

“Those at-large members are supposed to be selected at the annual meeting, but very seldom have they had a quorum at the annual meeting,” Yates said. “And you know they’ll just pick people from Socorro. To me, it’s another form of manipulation by the board.”

Another resolution the trustees are proposing is to increase their allotted expenses to 1 percent of total revenues, which translates to about $220,000 per year, or more than double what they’re getting now.

Board members have said the spending cap is too restrictive. The new bylaw that limits each trustee’s compensation to $10,000 per year isn’t in the best interest of co-op members, they say. They’re not able to get the education and training they need or be present at conferences where important issues are discussed that help them make informed decisions.

Yates disagrees. He thinks that staying informed is important but in this day and age a lot of that can be done online or through teleconferences, he said.

“I see no reason to pay these guys to travel all over the country. To me, we’re paying them to go on vacation,” he said.

Living in Datil, Yates is the kind of person the reform group is trying to reach with the tailgate party. But he won’t be present on Saturday.
”I’ve got bad knees and I’m on oxygen,” said Yates, who planned to send in a mail-in ballot instead. “I think mail-in voting is a good deal. There are a lot of people who live out by the Arizona line, and that’s a long way for them to go, especially with the cost of gas. But I think the (mail-in votes) should count toward a quorum.”

Mail-in voting was another new measure passed by members in 2010. It was employed for the first time at last year’s annual meeting and 367 people took advantage of the convenience. But because only people present count toward the quorum, it was all for naught.

Still Skeptical

Richard Sonnenfeld of Socorro was more measured in his comments about the board, though he, too, has little faith in their governance.

Sonnenfeld commended the co-op for some of the changes it has made in the last two years. Socorro Electric has begun to pay patronage capital back to members, its website is improved and transparency has crept into daily operations, he said, and the board has addressed the issue of financial irregularities, “which somehow they did not discover until reform began,” Sonnenfeld pointed out.

He also said the three new board members voted in as reform candidates seem to have the members’ interests at heart.

“But the board, as a whole, has behaved so badly that it’s safer to assume the entire board is tainted,” he said.

Sonnenfeld said he studied the proposed resolutions posted on the co-op’s website, but he found them to be hard to follow and the explanations unconvincing.

“The last item on the ballot explicitly tries to eliminate the spending caps that members imposed two years ago, and there are others that are clearly intended to protect the status quo,” he said.

Sonnenfeld said given their past record, he found it hard to put any trust in this group of trustees.

“Had the SEC board not fought reform tooth and nail for two years and sued its members, I might have been persuaded by their arguments,” he said. “However, I think the members’ priority now should be to remove as many trustees as possible.”

For that to happen, members would have to pass the one proposal Sonnenfeld said he’d vote for. It’s the one that approves new district alignments. That way, the bylaw members passed in 2010 that called for five districts of equal member populations, each represented by one trustee, could be put into effect.

Forcing Change

Myers and West feel the same way.

“We’ll never stop what I consider to be fraud and malfeasance, the overspending and kickback schemes — we won’t get clear of that if these guys retain control,” Myers said.

Myers also took issue with a proposed bylaw that takes removal of a trustee out of the hands of the people in the district that trustee represents and gives the board the authority to remove them.

“That’s obviously aimed at getting rid of Charlie Wagner, without any say so from the members,” he said.

“Every bylaw they’ve proposed is for the good of the board and not the members,” West said. “People are fed up.”

West said she’s tired of fighting the board and she doesn’t understand why they continue to fight reform.

“It would have been so simple, if they would have just followed the bylaws after they were passed,” she said.

West said when members passed the reform measures in 2010, the board should have formed a committee of members and together they could have sketched out a plan to implement reform. Instead, they fought reform and divided the community, she said.

“They haven’t asked to work with us in any way. If they would have worked with us, it would have made a difference,” she said.

If the board won’t agree to reform, members have to take it upon themselves to force change with a show of force, she said. But nothing changes if there is no quorum.

“People have to stand up and be counted,” West said. “We have to let them know that we’re still here and we’re not going away.”

And if it takes hot dogs and popcorn to entice them, that’s what they’ll do.

 


-- Email the author at tslast@dchieftain.com.

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