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Contact District 7 (Hays County) PEC Board member Patrick Cox: patrickcox7@gmail.com
MEDIA CONTACT: Anne Harvey, (830) 868-4933; Austin line, (512) 219-2602
Johnson City, January 16, 2009 – At a special meeting held Jan. 15, 2009, the Pedernales Electric Cooperative Board of Directors met to discuss the ramifications of the Navigant Consulting investigation report released on Dec. 15, 2008.
In light of the analysis and recommendations expressed in the report, District 7 Director Patrick Cox, with support from District 2 Director James Williams, District 3 Director Kathryn Scanlon and District 6 Advisory Director Charles Tesar, proposed a resolution to remove District 5 Director R.B. Felps as President of the Board.
The vote defeating the measure was split 4-3, with Directors Cox, Scanlon and Williams voting for, and Felps, District 1 Director Vi Cloud, District 4 Director O.C. Harmon and District 6 Director Val Smith voting against.
In other actions, the Board accepted the resignation of longtime law firm Clark, Thomas & Winters. A separate motion also passed authorizing PEC General Manager Juan Garza and Interim General Counsel Luis Garcia to find substitute appellate counsel to represent the Cooperative as it contests the appeal of the class action lawsuit settlement reached in March 2008, a role that had previously been filled by Clark, Thomas & Winters. The Board also unanimously voted to conduct a final review of all Clark, Thomas & Winters’ services and invoices in which Pedernales Electric may be involved. The review will be presented to the Board after it is completed.
Revenue forecast: $529 million, and $30 million net margin in '09
PEC Chief Financial Officer Mike Vollmer presented the Board with a detailed revenue and expense forecast for 2009. Based on conservative predictions of 2.5 to 3 percent growth within the service area, Vollmer estimated 2009 revenue of approximately $529 million, yielding a projected net margin of $30 million after expenses. “I am very confident in these projections,” Garza said during the presentation. “I had Mike prepare estimates with flat growth and with a shrinkage of 2.5 percent, and we would still maintain healthy margins in either circumstance.”
Garza went on to explain that he has eliminated open hiring at PEC and has instructed managers to look more critically at the Cooperative’s capital improvement program. “The Cooperative has an obligation to provide service to new members who move into the service area. A portion of capital spending is within our discretion, so we can be involved in those decisions,” Garza said.
The Board also heard a report from Director Williams on implementing key performance indicators for 2009; staff feedback and recommendations for the indicators will be brought before the Board in February.
2009 Board election review
Director Cox, chair of the Governance and Oversight Committee that sponsored a Jan. 12 forum on the 2009 elections, noted there was substantial member comment on the six issues discussed at the forum. The Governance and Oversight Committee will present recommendations on all six issues at the regularly scheduled Board meeting on Jan. 26, and the presentation made at the member forum has been posted to www.pec.coop.
The Board voted to extend a lobbying contract with former state senator David Sibley for one more year. After this contract expires, PEC will no longer hire external lobbyists. The Board also voted to move the strategic planning session originally scheduled for Jan. 29 to a later date, and to take up the remaining agenda items at its regular meeting on Jan. 26. The Jan. 26 meeting will be held at the PEC Training Center in Johnson City.
PEC transfers land to the city of Wimberley
Pedernales Electric Cooperative transferred a 0.158-acre tract of land, located in downtown Wimberley, to the city of Wimberley on Jan. 15. The land, originally purchased by PEC in 1995 to be the site of a transmission tower the Cooperative no longer intends to build, will be landscaped by the city for public use as required by the conditions under which the transfer was made.
The Pedernales Electric Board of Directors passed the resolution to transfer the land at their Oct. 10, 2008, meeting. However, because all PEC property is part of the collateral used to secure the Cooperative’s bond debt, release of the lien was required for the transfer to take place.
Both PEC and the city of Wimberley are benefiting from the transfer. The Cooperative has the opportunity to release land no longer necessary for business without compromising PEC’s bond rating and eliminate annual taxes paid on the property. The city of Wimberley is gaining a centrally located area for public use that will enhance the city’s appearance. “I am pleased that PEC could work in a positive way with the good people of Wimberley,” said PEC General Manager Juan Garza.
The Pedernales Electric Board of Directors passed the resolution to transfer the land at their Oct. 10, 2008, meeting. However, because all PEC property is part of the collateral used to secure the Cooperative’s bond debt, release of the lien was required for the transfer to take place.
Both PEC and the city of Wimberley are benefiting from the transfer. The Cooperative has the opportunity to release land no longer necessary for business without compromising PEC’s bond rating and eliminate annual taxes paid on the property. The city of Wimberley is gaining a centrally located area for public use that will enhance the city’s appearance. “I am pleased that PEC could work in a positive way with the good people of Wimberley,” said PEC General Manager Juan Garza.
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