Taos Coop Recent History: Part VI

April 29.2009

(From Horsefly online.com)

KCE

Cultural Energy is sponsoring a forum for the Kit Carson Electric Coop District 1 election on Tuesday May 5th at the Taos Town Council Chambers. Doors will open at 6 pm for the public to mingle & talk with the candidates. The forum will start at 6:30 pm and end at 8 pm. The forum will be broadcast on Thursday May 7 just after 8 pm on KTAO 101.9 FM and will be posted on line at culturalenergy.org. For more info call 575-758-9791.

Ask the incumbents why they refuse to discuss in public the enormous losses associated with propane and telecom and how management can justify the huge debt of the coop. Ask them to explain it…if they can. Ask them why they hide behind faux claims of “proprietary” concerns and why they expect the electricity consumers to subsidize propane and Internet. We hear the Coop has lost almost $4 million on propane since the division was started.

The Audit

The Coop’s auditor reported the following during his consolidated audit summary, Tuesday, April 28. He summarized net operating margins (aka “profits” in the private profit sector) as $5.3 million less a deficit in the propane-telecom sector (of $1.1 million plus), less Tri-State Capital Credit allocations of $2.4 million, meaning there’s an actual cash net of about $1.7 million. This reporter took careful notes and rounded the figures off. On its balance sheet of little more than $100 million, according to the auditor, the Coop has about a 36% equity stake, which means they have about 64% or an estimated $64 million in debt.

The auditor mentioned neither the propane-telecom losses or the debt directly but this reporter “put the pencil to the paper,” as Virgil might say. The attempted cover-up speaks to the lack of moral courage on the part of trustees, who put re-election before their fiscal duty to the members. Horse Fly will have more to say about these issues in the future. Plus we don’t like be treated with contempt by trustees who apparently think reporters can’t add and subtract.


The auditor said the Coop had a “clean” or unqualified audit. In other words, they do their bookkeeping properly—even if management occasionally violates board policy by not presenting construction estimates and change orders to the board. The auditor, in response to questions from Trustee Virgil Martinez, said that board policy disputes were not in the purview of financial analysis. Nor is there any debate about the wisdom of a number of projects that have been, allegedly, shovel ready for some time: solar array at UNM-Taos, the Command Center, etc.

Yesterday, the Coop also indicated it was interested in subsidizing the Questa business park. During an election season, trustees will say or do anything just about to get re-elected. Even Virgil praised the long term propane program and bought into the Rabbit’s fantasy about saving consumers $20 million due to Coop competition in propane.

Activist Jerome Lucero got up after the audit report and asked for specific profits and losses regarding Propane and the Internet. Neither the board nor the staff would reply, due to “proprietary” concerns, they said. Ironically, the trustees and staff were stonewalling Lucero and refusing to admit or recognize the numbers mentioned by the auditor minutes prior to his question. It was a sad day.

CEO Reyes did say the propane division lost $405,000 if you subtract interest and depreciation from the report first. But we hear the real losses are more than twice that figure. Reyes said then that they had saved customers collectively some $20 million due to downward pressure on prices created by competition from the Coop.

Attorney Jack McCarthy echoed Reyes’ sentiments, as did trustees Virgil Martinez and Manuel Medina, who are up for re-election. McCarthy also said Reyes should be congratulated for keeping the bookkeeping and reports separate on the propane and Internet divisions. 

Virgil and Manuel will side with each other if it means getting re-elected.



The point is both propane and Internet are not stand-alone divisions: witness the auditor’s consolidated report. As for the $20 million saving, que? I’ve got a bridge I want to sell you and Joe Mike’s got some gravel for you but you don’t live in Penasco. These guys should work on Wall St. Much of what the trustees talk about in terms of propane and broadband appears to be another ponzi scheme based on hope and the future. So is the Gospel of St. John. They should leave the preaching to the priests.

The board refused to give Lucero the specific information on Propane and Internet, so, in Lucero’s words, “the members could make up their minds” about whether the electricity customers should absorb losses on behalf of propane and Internet customers. But, apparently, the members are there or here to serve the trustees and their dreamer in chief. We shall look forward to the annual meeting.

Politics

Trustees get nervy during the election season and, as Jervis is inclined to say, “The Fix is in.” In Taos, incumbents Manuel Medina and Francis Cordova are favored to win re-election by the bookies though Cliff Bain, a challenger, is given an outside chance, due to his outsider status: Everyone is a little tired of the fighting and rumors and the inability of the trustees to tell the truth. The trustees are apparently incapable of engaging in transparent analysis and conclusions. They don’t issue reports regarding the digital meter divide or clarify propane and Internet P&Ls. They ignore discussing various construction-expansion projects in public. Why proprietary? They have no competition except with each other for a piece of the pie and the power. 



Nor do trustees issue reports regarding the viral travel bug: Call it Swine Flu. Who gets the Tri-State perk, who gets Statewide, who gets to go with Luis to Washington, Vegas, and Disneyland. That’s what the Coop is about: travel and collecting per diem for most trustees. Ask Toby how much he’s spent during the first three months. Ask Manuel. Art and Ambrose better watch out, their team is in second place.

Others who will vie for seats in the Travel Club–vote for two—include Tim Martinez, the state Supreme Court censured double dipper, Erminio “Willful Misconduct” Martinez, Meliton “The Quiet Man” Struck, and Candido Mondragon.

On Tuesday Taos Pueblo activist Gladys Kozoll made a presentation, calling the new digital meters, “dumb meters.” That term could be broadly applied to the trustees who misrepresent the truth or to the members who believe them.

In district two, Questa, the nominating committee reported back. Mayor Malaquias Rael, who also wants a subsidy for the Questa business park from the Coop, chaired the committee. He said two aspiring candidates, Chris Gallegos and Jode Cisneros never showed up for interviews.

Incumbents Virgil Martinez and Bobby Ortega will, apparently, have no opposition. According to reports, Jode Cisneros has submitted a petition for candidacy. You can’t blame them for being scared of Jode but, really, can he be any worse than those who stonewall and try to cover-up the uncovered audit? 

Rumor has it that Jode owes the Coop money and has been told he can’t exercise his candidacy. The by-laws say a member must be in good standing with the coop regarding payments due to the coop–not more than 60 days in arrears. So the by-laws can be variously interpreted. On the other hand, the by-laws also refer to disputed and undisputed claims, which makes work for attorneys. 

The Trustees are going to need more help than they are likely to get from Cheerleader Mary Mascarenas to get through the annual meeting.