Spectrum

Board member tackles utility's bylaws

I wish to comment on the proposed amendments submitted by the Matanuska Electric Association Bylaw Committee. The changes affect the co-op's board of director campaign disclosure and conflict of interest rules.

First, a little history of MEA and their management-directed bylaws and policies. In the mid 1990s, under then-board president Tamie Miller, MEA developed policy and bylaws designed to insulate the management from the board and from the member-owners. For example, the MEA manager's contract is not available to co-op members. I'll tell you that it is an unbelievable five-year golden parachute agreement that would make Mr. Carmony a millionaire when he leaves us. Not only does he have wealth beyond understanding, but he has the power to overrule the board of directors at any time. The board members involved in delivering this kind of direction included Mrs. Miller, Aaron Downing and Bill Folsom among others.

After the 2001 MEA election, the board, under Bill Folsom's presidency, decided not to seat me after I won my election. They delivered false campaign charges and illegally kept me from my duly elected board seat. This action prompted a voting member of MEA to file a public interest lawsuit (Waterman vs. MEA) that worked its way through the system to Palmer Superior Court Judge Beverly Cutler's courtroom. The verdict was that MEA board's action was contrary to their own bylaws and MEA needed to solve the problem of contradictions between the bylaws and MEA's campaign disclosure rules. Judge Cutler also ruled that MEA must pay Mr. Waterman's legal fees and that the board was to seat me immediately. MEA has appealed the verdict and has spent nearly a half-million dollars on legal expenses so far.

The bylaw committee presented several amendments for consideration. The board had very little opportunity to have a dialog about the proposals before Tamie Miller came forward with member-signed petitions requesting that the amendments be put on the ballot, bypassing the board's role. The amendments included those relating to campaign disclosure, conflicts of interest and a bylaw requiring board directors to take a hair sample drug test. MEA staff asked for legal advice from Patton Boggs law firm, who reviewed these changes and did commit to allowing their passage to the ballot for the 2003 annual meeting.

The first bylaw amendment would change Article IV, Section 9, defining when newly elected board directors are seated. The existing rules say that the director should be seated at the next scheduled meeting (the second Monday in April) following the annual meeting. The change would mandate seating at the July board meeting, three months after the election. What's this about?

Section 11 Campaign Disclosure: The existing bylaws allow groups or organizations, attempting to influence the outcome of an election, total immunity from any disclosure.

(In prior years, a group called REACH had done all of the campaign financing for many current and past directors, including Bill Folsom, and the candidates filed zero expenses for campaign disclosure, a practice specifically prohibited under current rules.) The amendment would require said groups to report contributors and expenses. This is a good amendment.

Section 11(a) Campaign Disclosure: This change would lower the total contribution from $1,000 to $500, and candidates may spend any personal funds. I'm ambivalent about this change, however this change impacts non-incumbent candidates the most, by making it harder to raise campaign funds. Unless you can afford to fund your own campaign, or are well connected to people and groups who contribute, you are at a disadvantage in the election.

Section 11(b) Campaign Disclosure: This amendment is more restrictive than APOC rules that allow 18 months prior to an election to collect campaign funds. This change would allow only 12 months. This appears to help incumbent candidates more than new individuals interested in their member owned co-op.

Section 11(c) Campaign Disclosure: This change is again somewhat more restrictive than the APOC rules which require candidates and groups to report only contributors giving in excess of $100 per year. This amendment forces candidates and groups to report every contributor who gives any amount and additionally requires the reporting of the contributor's employer. I'm thinking that this begins to step on rights to free association and speech. The APOC rule should be good enough for MEA.

Section 11(d) Campaign Disclosure: This amendment increases the number of reports candidates must file from the current four to 11 or 12, depending on a candidate's activity. This is much more restrictive than APOC requirements of filing four reports during the course of an election year. I think a candidate would need an accounting department to keep track of all of these reports or be in the MEA legal mire.

Section 11(g) Campaign Disclosure: This is the most significant and damaging change among the proposed changes. Under this amendment, the board no longer has to give a candidate notice of corrective action. It also gives the board discretion on whether or not to allow a candidate the opportunity to take corrective action after reports are filed. Presently, the board is mandated to give candidates notice that they have failed to comply and then the candidate has 30 days to fully comply. The amendment also gives the board unlimited discretion and power to sanction candidates at various levels, up to and including disqualification of candidates and expulsion from the association. This, of course, gives unlimited and unchecked power to the majority of the sitting board. If they like someone who has committed a violation, they can allow the person time to take corrective action; if they dislike a candidate, they can remove and disqualify the candidate. In other words, the change would allow the board to do what they could not do before, as ruled in the Waterman case.

Section 14. Conflict of Interests: We definitely should have bylaws pertaining to conflicts of interest. The bylaw amendment states the following: "A director shall disclose any financial interest in any matter that must be decided by the board, and shall abstain from debating or voting on that matter." This is a good thing, but the rest goes a little too far. "A Director shall disclose to the board the substance of any communication materially related to the business or financial affairs of the Association that occurs between the director and any person representing the interests of: 1) any union representing a group of Association employees; or 2) any entity engaged in selling power to the Association; or 3) any business with whom the Association has an existing or prospective contractual relationship that requires board approval."

I think the board directors should have dialog with unions so we can avoid nasty situations like the '99 strike and the Rewire the Board lawsuit. I think we should have talks with our power supplier, Chugach Electric. And I hope I can foretell who might be seeking a contractual relationship with MEA or I'm guessing I would get the boot just for being seen talking to that person in the grocery store and not reporting it to MEA.

These amendments deliberately and with forethought discourage the average member from running or even participating in the election process. The amendments make campaign disclosure rules more cumbersome and restrictive. The philosophy of the amendments goes against the grain of a "member owned and run cooperative." The bylaw contradictions needed to be fixed, but the changes proposed do a disservice to MEA membership. Because the bylaw amendments will be a block for an "all or none" consideration and can't be taken individually, I encourage the members to vote no this time around.

Michael Janecek sits on the MEA board of directors