By the Homer Tribune
The Homer Tribune interviewed Homer Electric Association General Manager Brad Janorschke in a written format, in preparation for this the meeting at 6 p.m. Thursday at the Homer High School.
Q: We hear a lot of things tossed around in terms of input and accountability, but what does it really mean to be considered a “member-owned cooperative”?
A: Being a member-owned cooperative in the most basic definition means the members own the cooperative. This ownership starts in the membership’s election of a board of directors whose primary responsibility is establishing the strategic direction of the utility. Ownership also means any revenue in excess of expenses is allocated to the members in the form of capital credits. This contributed capital is ultimately returned to the members.
Q: How much are members’ voices taken into account on any given decision?
A: Under the bylaws, the board of directors is charged with the responsibility to manage the business and affairs of the cooperative. Being responsible for the strategic direction of a multimillion dollar enterprise providing a critical service, the individual directors are required to make informed business decisions, rather than politically popular decisions. In this respect they differ from the popular perception of elected political officials. Obviously individual directors may be influenced to some extent by their perception of the popular will.
Q: As a “member-owned cooperative,” in what cases are members prevented/allowed access to specific financial information about HEA’s expenditures in budgets, salaries, etc?
A: The HEA budget is typically driven by the strategic direction of the cooperative, as is established by the board. Once the board adopts a strategic direction, it must implement the direction. Establishing and approving the annual budget is one of the board’s primary responsibilities. Many members believe member-owned means all information is available to the public, much like a municipal or governmental organization. However, the cooperative governance model more closely represents a corporate model whereby the member shareholders elect a board to make decisions that are in the best interest of the organization and the shareholder analogy is used in determining the propriety of a request for information by a member. HEA follows the standard set forth in the Alaska statutes pertaining to cooperatives: a request for information will be honored if the requesting party can demonstrate a proper purpose for the request. Requests for specific information are handled on a case-by-case information based on the intended use of the information. HEA has information that is not publicly available such as information that would violate the confidentially of personnel or be detrimental to the financial business of the cooperative.
Q: As Americans, we’re generally used to having anonymity in our voting choices. Why do members have to sign their names to HEA ballots?
A: Members are not asked to sign their ballot, only the ballot return envelope. The signature allows the election committee to doublecheck with the cooperative’s membership list to ensure each ballot received is from a valid member and that each member only receives one vote. HEA ballots are counted by a machine, like is done in state elections. The tabulation of the ballots is overseen by an election committee made up of two members from each district.
Q: This winter, when rates increased dramatically with no warning or input from members, the RCA said HEA is not required to do either of those actions by state law. Will HEA be willing to give consumers warning next time, to avoid the hardship it caused this winter?
A: It is not really accurate to say there was no warning. HEA has always done its best to let its members know of rate increases. This past winter’s increase was the result of a quarterly adjustment in FUEL COSTS passed on to HEA by its power supplier. It was not a decision made by the HEA board. Shortly after HEA was made aware of the increase by its wholesale power provider, there were press releases sent out … . That said, the rate increase was extremely difficult for many members and HEA is looking to improve ways to better communicate changes in our rates so that members are able to adjust.
Q: What do you think about the Governor’s plan to unite utilities along the Railbelt?
A: I think the Governor’s desire to unify the generation and transmission assets on the Railbelt certainly deserves a closer look to evaluate the potential benefits. Currently representative directors from the 6 Railbelt utilities are addressing governance concerns with the Governor’s plan in hopes a structure can crafted that will encourage all Railbelt utilities to participate.