January 28, 2009
FOR IMMEDIATE RELEASE

PEC revises election process, reduces number of Directors

At their regularly scheduled meeting held Jan. 26, the Pedernales Electric Cooperative Board of Directors voted to revise the Cooperative’s bylaws by reducing the number of Advisory Directors and approved four revisions to the process used to elect Directors.

The proposal to reduce the size of the PEC Board was submitted by Board Vice President James E. Williams and was approved unanimously. Due to vacancies created by earlier resignations, PEC currently has five Advisory Directors and one Advisory Director-at-Large. With the PEC Board’s actions Monday, all of these positions on the Cooperative’s Board will expire June 18. The Board may still appoint up to four Advisory Directors in the future, but is not required to fill the positions.

The Board’s move to reduce its membership falls in line with an analysis submitted to PEC in December by Navigant Consulting, Inc. “The Navigant review of Directors’ compensation made a big issue of having too many people on the payroll,” PEC Board President R.B. Felps commented. “These are big changes.”

The changes to the Cooperative’s Director election process were submitted by the Board’s Governance and Oversight Committee comprised of District 7 Director Dr. Patrick Cox, District 2 Advisory Director Rusty Allen and Advisory Director-at-Large Lamont Ramage. In proposing the changes, the committee considered input gathered from members at a public meeting held Jan. 12. The adopted changes include:

• Number of votes per member: Each member will now have one vote, regardless of the number of meters they have. The approved voting regulation is consistent with most other cooperatives and agrees with Internal Revenue Service recommendations relating to tax statuses and democratic control for cooperatives. PEC will make changes to its customer information system to limit members with multiple meters from receiving duplicate votes.
• Number of signatures required for nomination: To be considered as a candidate for the Board, potential nominees will be required to gather 50 signatures from PEC members on a written petition. In 2008, 25 signatures were required.
• Board residency rules: Candidates for Director positions will now have to maintain a primary residence in the district they will represent, rather than simply having a meter or business in the district.
• Board districts: The Board voted to adopt redrawn Director district boundaries submitted by PEC’s engineering staff that more evenly distribute the number of meters per district. The new boundaries range in size from approximately 30,000 meters in District 4 to approximately 36,000 in District 1. Under the prior Director boundaries, the number of meters in each district varied drastically, from approximately 14,000 in District 1 to about 64,000 in District 3.

The Board’s Bylaws Committee plans to meet Jan. 30 to finalize bylaws revisions related to the election changes. The Board decided to table a policy proposal submitted by Williams on Director term limits.

Also approved by the Directors was a new policy for internal and external communications by PEC Board members, submitted by Williams. The approved policy instructs Directors to “clearly state whether he or she is speaking as an individual Board member or on behalf of the entire PEC Board” when addressing the media or the public about Cooperative matters. “This [communications policy] is not a new and novel concept,” Williams said. “Fortune 500 companies, nonprofits and government agencies have communications policies.” In creating his proposal, Williams stated he researched policies implemented by other organizations and “endeavored to choose the best practices from what I hoped would be most applicable.” Members present at the meeting commented both for and against the policy prior to its approval by the Board.

The new policy also requires Board members to get prior approval of the Board and PEC General Manager Juan Garza before using PEC staff and resources to release written communication to the media or general public. The communications policy also routes internal communication by Board members to PEC staff through Garza or his designee. The measure passed by a 5-2 vote, with Cox and District 3 Director Kathryn Scanlon voting against the new communications policy, with Cox saying “it’s our responsibility to be able to use our judgment and use the resources that we have and be able to provide our opinions [to the membership.] It’s our right to communicate and provide information to our members.”

Cox reported that a bank account titled “Bennie Fuelberg Trustee Account,” which was opened by prior PEC management to fund a political action committee, is no longer active. Garza reaffirmed that PEC will no longer hire lobbyists after active contracts end. Garza also announced that consultant Bill Cunningham’s contract will not be renewed after it expires at the end of this month, bringing the number of third-party contracts PEC has from 10 to one.

In other business, the Board approved renewing memberships in state and national cooperative organizations, heard a report on PEC’s Member Assistance Program and approved guidelines and funding for the Cooperative’s Light the Way program. Garza also reported the Cooperative will receive a fuel charge decrease from the Lower Colorado River Authority, but since PEC did not pass on to members the last increase in cost from the LCRA, and because the Cooperative is working to finalize a comprehensive rate study, PEC rates will not change.

The next meeting of the Board is planned for Feb. 23 at 10 a.m. at PEC’s Johnson City headquarters building. Nomination petitions for members interested in running for an open position on the PEC Board are scheduled to be made available on PEC’s web site in early February.