Policy cleanup dominated the agenda at the Pedernales Electric Cooperative board of directors meeting Friday, Sept. 17, which ended at 2:30 p.m. after a four-hour executive session. All seven directors attended to hear updated resolutions on policies, most of which will come back before the board in October for final approval. No members of the public signed up to speak during the public comment period for the second month in a row.
The board also set the next annual meeting date for Friday, June 17, 2022, the third year it will be held on a weekday. Again, it will be a business meeting held prior to the regular June board meeting at PEC headquarters, 201 S. Avenue F in Johnson City. In previous years, the co-op scheduled its meeting and board member elections on Saturdays with a free lunch and giveaways.
“It cuts down on expenses, and it cuts down on staff time and the number of staff needed after hours,” board Chair Emily Pataki said of the move to weekday annual meetings.
The board gave final approval to a resolution authorizing changes to the Policy on Policies, while other resolutions with policy changes will come back before the board in October for one last look. Basically, the language was simplified on policies across the board. Also, they are all now set for board review every five years instead of two or three years.
The following resolutions and their changes will be up for approval in October:
- Board of directors compensation policy — moved from two-year to five-year review.
- Review and approval of investment policy — added Fitch and Moody’s as two additional organizations that can rate investments for the co-op. Prior, only S&P was used for ratings.
- Unclaimed property — included a provision to convert a percentage of unclaimed funds belonging to co-op members who cannot be located to the PEC Scholarship fund and any other qualifying scholarship funds. Also, a list of persons who have unclaimed funds will be published to help locate owners.
- Power supply and energy management policy — will no longer require the chief operating officer or the vice president of engineering to serve on the committee; changing from quarterly to semi-annual meetings.
A proposal to change committee reports to the board from quarterly to “as needed” was questioned by District 7 Director Amy Akers.
“That’s not defined enough,” she said. “I want it to be more defined.”
She then went through a list of points she said were not clear enough and ask for each to be fixed by the October meeting.
“I appreciate our policies getting a new look,” she said in conclusion.
The board went into executive session at 10:30 a.m. to discuss 15 agenda items, including a resolution that would authorize opting out of having to file with the Public Utility Commission for winter storm debt securitization.
A vote to opt in or out of the debt securitization was a requirement of Senate Bill 1580, which was approved by the Texas Legislature in May of this year. It enables electric cooperatives to “use securitization financing to recover extraordinary costs and expenses incurred due to the abnormal weather events that occurred in this state in the period beginning 12:00 a.m., February 12, 2021, and ending at 11:59 p.m. February 20, 2021.”
Debt securitization reduces the cost of financing, according to the bill.
The cooperative accrued $160 million in debt from the winter storm last February. Board members voted to add a temporary winter storm surcharge to members’ bills of $8 to $12 a month for 24 months beginning Oct. 1 to pay off the debt.
Other items on the executive session agenda were a resolution to amend the 2021 PEC budget, including winter storm, bond defeasance, and real estate matters; an update on the extreme cold weather event February 2021 after-action review; and approval of capital improvement plan budget amendments for real property acquisitions.
After four hours behind closed doors, the board reconvened to quickly approve two resolutions, including the debt securitization opt-out. Directors also renewed medical insurance benefits for 2022.