Power Brokers: Some electric co-op boards make more, do less

August 18, 2010 10:42:00 AM

Ryan Poe - [email protected]


As long as the lights stay on, most people are content to stay in the dark about who runs their electric company. 


But taxpayers expect not-for-profit companies, like the 25 electric cooperatives of Mississippi, to live up to industry standards, especially in executive and board compensation. 


Unlike many co-ops, the Columbus-based 4-County Electric Cooperative Association was in line with industry compensation standards 10 years ago and has not given its directors raises since then, said 4-County spokesman Jon Turner. 


The co-op''s seven directors were compensated an average $22,517 for working five hours a week in 2008, according to the company''s financial statements. 


Officers on the board were paid a little more than other directors, who received about $342 per meeting and $14,898 annually in insurance benefits. 


Directors, who meet at least once a month, also receive a $150 per diem mostly for training and business trips. 


"Based on the numbers I''ve seen, (our directors'' compensation) is in line with what most co-ops do around the country," Turner said. 


Although financial statements say directors only work five hours a week, Board President Jay Gilliland said that number could be higher. 


"I put a whole lot more than five hours in for 4-County," he added. 


Moreover, "there''s no talk whatsoever" about increasing salaries of directors, Gilliland said. 


"We''re very concerned about our members and where they are in this economy," he said. 


Several smaller co-ops nearby pay their directors more per hour than 4-County does. 


The Monroe County Electric Power Association paid most of its nine board members more than $16,000 in salary and insurance benefits for working an average two hours per week, according to 2008 financial statements. Two directors did not receive benefits. 


And to the north, the Tupelo-based Tombigbee Electric Power Association paid eight of its 16 directors more than $19,000 in salaries and benefits for working an average one hour per week in 2008. 


However, those who join cooperatives are ultimately responsible for setting directors'' salaries and paying them. Once consumers join, they become joint owners who can vote at annual meetings for directors and for how much they are paid. 


But those who do not attend the meetings are often left out of the loop. And knowledge is power, especially for members of electric co-ops, said Patrick Lavigne, spokesman for the National Rural Electric Cooperative Association. 


"The principle of oversight (in cooperatives) is democratic in nature," he said. 


Only 500 of 4-County''s 145,000-plus members showed up at this year''s annual meeting in June, Turner said. 


But knowing that directors have to report to the members who do show up helps keep directors "above and beyond reproach," Gilliland said. 


"We don''t hide anything. Everything''s above board," he said."We report everything that''s going on and try to adhere to industry standards."