Austin, TX: (Mar-11-08) A small group of Pedernales Electric Cooperative members filed a class action suit, challenging the board of directors' salaries and seeking payouts of capital credits (member dividends) and more openness in the co-op's operations. It was stated that the board members were reimbursed for about $700,000 in expenses between 2002 and 2006 for everything from first-class airfare to top-tier hotel stays to costly purchases of meals, furniture and concert tickets, according to court records.
Median pay, including health benefits, for 17 Pedernales board members was $50,322 in 2006, according to tax forms, for a total of $1 million, which is ten times what the board of directors cost at the country's second-largest electric co-op, Jackson Electric Membership Corp. in Georgia. Infact, disclosures made in the course of the legal action hastened the departure of three longtime Pedernales officials: board President W.W. "Bud" Burnett, General Manager Bennie Fuelberg and Assistant General Manager Will Dahmann. The lawsuit also sought removal of the top executives and board of directors, and governance reforms that would ensure transparency to its operations and payment of capital credits to members.
The case has been settled with an agreement, which is considered preliminary, for the the co-op to refund $23 million in dividend payments over a five-year period to its customers, who are considered owners of the utility. [
