Refining PEC Processes: Part 4

At long last we reach the final installment of my four part series, “Refining PEC Processes.”   Thus far we have dealt with election policy, governance, and a rate reduction. Today I want to delve into PEC’s community involvement, which is one thing that sets us apart from other types of electric providers.

While most electric providers exist as for-profit entities, co-ops are a little different. PEC is a non-profit corporation owned by its members. We operate under a set of seven principles shared by all cooperatives. Some of the more well-known principles are “voluntary and open membership” and “democratic member control.” Another important principle you may not have heard about is “concern for community,” in which cooperatives seek to enrich communities through member accepted sustainable development programs.

PEC has a long history of helping its member communities. Our scholarship program is a staple of that tradition. Every year, the Co-op awards exemplary high school seniors with scholarships to be used for college tuition and related expenses. In 2014, PEC provided 14 scholarships to graduates with amounts ranging from $2,500 to a single $10,000 scholarship. Another favorite example of the Co-op’s community support has been the Christmas light display at PEC headquarters in Johnson City, which draws visitors from far and wide.

In addition to the annual programs, PEC gets the opportunity to give charitably on a case-by-case basis. I recently had the pleasure of participating in an employee event honoring a military veteran. Operation Finally Home, a national charity that builds mortgage-free homes for severely wounded veterans across the country, recently began building a home for USMC veteran Ray Coffey and his family in the Liberty Hill area. Read more about PEC’s involvement in this touching story.

While our Co-op’s involvement in our member communities can be a powerful and wonderful thing, we must keep a close eye on the annual cost of our charitable programs. Members have criticized the PEC Board in the past for not being good stewards of member money and not scrutinizing carefully enough the ways we contribute to our communities.   For example, as much as people love to see the PEC Headquarters lit up every year around Christmas, few people realize that the grand display is a very expensive undertaking. Our 2014 cost for this program will be over $275,000! As the Board and staff move into the 2015 Budget cycle, criticisms over costs like that of our Christmas lights deserve our attention, as we want to make sure that Co-op giving matches up as closely as possible with our members’ interest in using their dollars to do so.

PEC staff recently introduced an idea to adopt a program that several other co-ops have used for sometime that might alleviate concerns as to how we give charitably each year. The program, called Operation Roundup, has been successfully implemented by many Texas co-ops. Through Operation RoundUp, every member bill would be rounded up to the next even dollar, and that “round up” amount would be put towards funding the co-op’s charitable giving. The idea is that by everyone giving a few cents each month, collectively PEC would be able to give substantially to our communities without using a portion of our annual budget to fund such measures – with the adoption of the new program, the co-op would take charitable contributions out of its budget. CEO John Hewa, during the Operation RoundUp presentation to the Board on October 13th, mentioned that with the adoption of the program could come a modest rate reduction, as the removal of charitable contributions from PEC’s budget could provide the relief necessary to further lower rates for members. (Read more here, beginning on p. 136)

PEC has been a great contributor to its service territory, and we want to ensure our co-op remains committed to sustainable development in our communities. However, as we tighten our belts internally and examine all cost centers, we must be open to adjusting our charitable giving, too. Perhaps Operation Roundup will allow us to maintain our cooperative principles and Hill Country traditions without driving up operational costs. That should make a lot of our members very happy.

One thought on “Refining PEC Processes: Part 4

  1. Pingback: 2015 Summer Recap | It's Your Co-op

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