Wimberley retired economist Merle Moden, long a critic of the Pedernales Electric Cooperative's spending habits, will be in attendance at this morning's PEC Board of Directors meeting. The meeting is scheduled to begin at 10 a.m. at the co-op's Johnson City headquarters. Moden says he will present Directors with a documented list of millions in unnecessary and excessive expenditures. It adds up, he said, to the PEC distinguishing itself as "one of most cost-inefficient electric cooperatives in the U. S." Moden last week sent the letter below to PEC Directors. We'll try to catch up with Mr. Moden, and a Director or two, for an update following the meeting. Fyi, the Navigant report referred to by Moden once was, but no longer is posted on PEC's recently refurbished web site. The website's retooling cost a reported $750,000 – for what we're not sure. It is colorful but we find it a little cumbersome to navigate or to find details about the co-op's business costs and expenditures.Send your comments and news tips to roundup.editor@gmail.com, to Mr. Moden at mlmoden@gmail.com, to PEC board president Larry Landaker at larry.landaker@gmail.com, or click on the "comments" button at the bottom of the story
Dear Members of the Board:
I was present when Mr. Todd Lester, Navigant Consulting testified in the punishment phase of the trial of Bennie Fuelberg in Fredericksburg. His testimony reminds one again of the utter contempt that former Boards of Directors of the Pedernales Electric Cooperative, Inc. (PEC) and General Manager Bennie Fuelberg had for the members of the PEC. The Navigant Report, December 2008 lays out in great detail their failure to carry out their duties as fiduciaries in a responsible manner.
The Navigant Report functions as an investigative report and as a horror story for PEC members characterized by reckless, irresponsible, unnecessary, and excessive expenditures of members’ money. Appendix B, Key Ratio Trend Analysis, of the Navigant Report provides graphic evidence of the dismal failure of governance and management at the PEC to preserve the assets of the PEC. Estimates of the fiscal impacts of some of these failures are shown below.
Appendix B, Pages 32, 34, and 36 show comparative annual expenses per customer for Accounting Expense, Sales & Service Expense, and Administrative & General Expense. PEC expenses in these three (3) categories are compared to the Texas Median Value and to the Peer Group (all U. S. electric cooperatives with 100,000 members or more) Median Value. Enclosed are copies of a spreadsheet and a graph showing comparative data for these three categories combined. For the period 2002 through 2007, an estimated $141.7 million was wasted by PEC’s governance and management when compared to PEC’s Peer Group.
Appendix B, Page 41 compares annual Total Cost per Customer. Enclosed are copies of a spreadsheet and a graph showing comparative data for Total Cost per Customer. For the period 2002 through 2007, an estimated $306.4 million was wasted by PEC’s governance and management when compared to PEC’s Peer Group.
It is time to take action to roll back the wave of unnecessary and excessive spending from the Fuelberg era. It has been two years since the Navigant Report was released. The Board in 2008 failed to act to eliminate unnecessary and excessive expenditures in the 2009 budget. The Board in 2009 failed to act to eliminate unnecessary and excessive expenditures in the 2010 budget.
Will this Board take a stand and begin the process of making PEC compare favorably with its Peer Group? Or, will the 2011 budget be business as usual? The PEC is the largest electric cooperative in the U. S. Is this Board satisfied with the distinction that it is also one of most cost-inefficient electric cooperatives in the U. S.?
Please take action now to eliminate these unnecessary and excessive expenditures.
Thank you for your consideration.
5 comments:
"Please take action now to eliminate these unnecessary and excessive expenditures. Thank you for your consideration."
Boy, Merle, I'm sure the tough way you wrote that statement has the PEC Board shaking in their boots. I'm sure we can look for rate decreases with you as our advocate.
If Mr. Moden's research and numbers are correct, I don't understand why the board of directors isn't taking immediate action to reduce the spending. Who's in control over there?
We utility users are in control. We need to educate ourselves about energy conservation and smart grids. Stop giving up control to PEC and their willingness to do - or not to do - the right thing.
Built smaller houses, set up smart grid timers in your existing homes, and buy less junk that needs electricity.
We all need to stop acting like helpless victims of the PEC Board's benevolence. Change your lifestyle to one of smart energy consumption away from one of lazy and uneducated energy consumption.
Moreover, I am totally opposed to PEC removing subsidies for users who cannot afford their utility bill, as long as the review for subsidy is truly based on actual and valid need, especially if children and seniors are involved.
Rocky said: “Moreover, I am totally opposed to PEC removing subsidies for users who cannot afford their utility bill, as long as the review for subsidy is truly based on actual and valid need, especially if children and seniors are involved.”
The PEC giving “users that can not afford their utility bill” a subsidy or credit is another one of the insidious little methods of distribution of wealth that Liberals seem to love. It usually leads to more “need”, much like the federal government continually extending unemployment benefits. People that can’t afford their bills are an indicator that the costs are too high, not that the poor need help more help. These giveaways just create a dependency just as every welfare program eventually does. Most of the poor are not really poor in the classic sense; they are just poor money managers aided by these handouts.
This is my first experience with a utility supplier of this sort. I have always lived in cities where the municipality used the funds collected from their customers to subsidize their wild spending. The ‘For Profit’ utility companies were even worse; witness Aqua Texas. I thought that the PEC, being a customer owned Cooperative, would try to control costs so everyone could afford their services. You don’t do that by a ‘Robin Hood’ method of pricing. Cap your costs and eliminate some of the bloodsuckers in management at the top. Giving the Christmas mega bonuses is just plan stupid and maybe even criminal.
"Most of the poor are not really poor in the classic sense; they are just poor money managers aided by these handouts."
What is the "classic sense" of poor, and what data and/or experience do you rely on for this conclusion about who is poor among us?
Thanks.
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