Pedernales Electric Cooperative’s Board of Directors voted at its Monday, March 15 meeting to approve the Cooperative’s capital improvement plan, which outlines the schedule and budget primarily for projects relating to improving the reliability and capacity of PEC’s electric distribution system. The plan, which forecasts to 2013, includes building and improving substations, constructing electric lines and upgrading transformers.
The Board’s approval allows PEC to begin work on projects outlined in the plan, including four transmission, 25 substation, 69 electric distribution and 60 general plant projects in 2010 alone. The plan projects a $111.3 million budget for this year’s projects, down from $141.1 million spent in 2008 and $133.9 million in 2009. PEC forecasts an even smaller capital improvement budget for 2013: $61.3 million. Projects required by demands from the Electric Reliability Council of Texas and the Texas Department of Transportation for infrastructure improvements and redesigns are included in the plan.
The capital improvement plan’s architect was PEC System Engineering Manager Robert Peterson. “We’ve taken a hard look at the electric system and weeded out a lot of the projects that simply don’t need to be done, and what we have left is a very good plan for the expansion of the system,” Peterson said.
The Board also voted to establish a committee to consider and make recommendations about compensation matters to the full Board. The committee will be comprised of PEC Board President and District 6 Director Larry Landaker and the chairpersons of two other committees, District 7 Director Dr. Patrick Cox and District 1 Director and Board Vice President Cristi Clement. District 5 Director R.B. Felps initiated the drive to establish the committee at the Board’s Feb. 22 meeting.
The related resolution passed by the Board states the purpose of the committee “shall be to consider and make recommendations to the Board on any compensation policy or any compensation plan concerning the overall compensation philosophy and programs of the Cooperative.” The resolution also directs the committee to “review and recommend to the Board appropriate compensation and benefits for Cooperative Directors and executives.” The resolution designates the committee as a special committee that will be dissolved once the Board determines the committee’s work is complete.
The Board also revised its “authority and responsibilities” policy, which defines the relationship between the Board and management, to change approval procedures and establish a tracking system related to contract approvals. The revised policy includes lowering from $5 million to $1 million the contract values requiring approval by the Board prior to agreeing to a contract, as well as lowering the value of consulting contracts needing prior approval from $1 million to $150,000. The Board also must approve all contracts two years of length or more and all capital improvement plan projects totaling $2 million or more.
“What this does is build a view into the pipeline of contracting activity, as [it is] developing, and before award, so we can see the population of contracted-out effort before the fact, rather than seeing it after the fact,” Clement said. “Furthermore, we found the $5 million threshold was excessive to any source we could compare it to.”
Landaker noted, “This is not in any way designed to trim the authority or lack of confidence in the general manager; this is a refinement-based policy change.”
PEC staff updated the Board on plans to reduce uncollected debt from nonpaying current and former members. The Cooperative recently contracted with a collection agency, and PEC will begin requiring identification from new members beginning March 22 and will take steps to improve address verification for final bills for members discontinuing service.
During the member comment section of the meeting, members spoke about the results of the Somerset Guild study discussed at the Board’s February meeting, thanked the Board for providing a Junction-area Director district map, and expressed disappointment at the Board’s rejection of a proposed single-member district voting system.
In other action at Monday’s meeting, the Board:
• Revised the Cooperative’s whistleblower policy to clarify what types of situations qualify as reportable under the policy and to implement other language recommended by internal auditors. The policy allows employees, members and others to report, without fear of retaliation, workplace issues of fraud, waste or abuse, concerns about potentially unlawful or unethical behavior or acts of financial malfeasance.
• Heard a report on the Cooperative’s plans to observe Earth Day, which include urging members to take a voluntary pledge to conserve electricity, a compact fluorescent lightbulb (CFL) giveaway, initiating a CFL recycling program and participating in a Home Depot conservation forum in Cedar Park.
• Adopted a decorum policy to establish rules for maintaining order during Board meetings.
• Approved increasing the limit of paid committee meetings during a Board term year from 10 to 12.
• Approved moving its June special organizational meeting from June 21 to June 28. The Board will use this meeting to formally seat newly elected directors and elect officers.
• Approved having a door prize at the June 19 annual membership meeting.
• Approved indicator levels to use in evaluating and rewarding PEC staff for reaching specific performance goals.
The next regular Board meeting will be held at 10 a.m. on April 19 at PEC’s E. Babe Smith Headquarters Building in Johnson City. At the meeting, the Cooperative plans to announce this year’s slate of candidates running for positions up for election on the Board.