[Watchdogs] Sending out checks for $1.01 and paying $1.50 for post and handling

Sun Nov 1 19:37:35 CST 2009

Dear Milton:  With all due respect to Mr. Garza and his estimate of $1.50 to send out each check......I do not think that PEC has developed any accounting system to actually know what it costs to send out checks to the Owners. I sincerely doubt that PEC has developed any accounting system to KNOW what anything costs.

Ok, let's say for a minute that $1.50 is a correct figure to mail out a check.  Then they send out about 150,000 letters to those lucky souls, like me, for example,  with a promise to send me $46.37 for my 2008 allocation.  That letter of Oct.19, 2009 was another item of expense of about $225,000.

OK, I get back $46.37  It has cost $3.00, so far in postage and handling.  That is 12 percent of my returned money.   All for educating me as to the "Financial Participation"
of PEC.  Gee, Thanks a bunch Mr. Garza.

There is going to bunch of happy fellows who get a check for about $1.01 and it cost $3.00 to send it to them.  Some of you watchdogs may have already gotten that letter of Oct. 19, 2009 telling you that you will be getting a check of less than $3.00,,, about equal or less than the cost of mailing it to you.

The PEC "Inner-Circle" just have no financial responsibility and  are poor caretakers of our money.

Milton, this way of PEC Management treating us like rather dim boys is tiresome.  Every move that PEC Management makes is expensive  and convoluted.  If they would try, just now and then, to SAVE some money, we would certainly understand and appreciate that.

Hollis P. Langston  830-598-1322

  ----- Original Message ----- 
  From: Milton Hawkins 
  To: 'Paul Langston' ; 'PEC Watchdogs' 
  Sent: Sunday, November 01, 2009 3:57 PM
  Subject: RE: [Watchdogs] news article, Austin American Statesman, 10-31-09, Page B-2, Utility to issue Member's checks

  Paul,

  You are correct about the possibility (gone now, of course) of saving "a bundle of our money by simply crediting our monthly accounts."  In an answer to questioning by Director James Williams, Mr. Garza stated that it will cost $1.50 per check to issue these checks.  At, say, 220,000 meters, @ $1.50 per meter, that's a cost of $330,000 to send out $4 million in checks, some of which could be for as little as $1.01.  (The figure $300,000 was used at the Board meeting.)

  Any way you cut it, that's a pretty expensive way to distribute money.

  Milton

  PS: Here's the Statesman article you reference, based on a PEC press release:

  PEDERNALES ELECTRIC COOPERATIVE 

  Utility to issue members checks 

  The Pedernales Electric Cooperative said that it will issue up to $4 million in dividend-like payments to eligible members, with many receiving the money in the form of a check for the first time. 

  Any member with a credit of more than $1 will get a check rather than a credit, which the co-op issued the past two years the program has been in place. Payments will go out in November. 

  "By deciding to distribute capital credits in the form of a check, we are trying to give our membership tangible evidence of their financial participation in PEC," General Manager Juan Garza said after a special co-op board meeting to approve the move. 

  The co-op, the largest member-owned utility in the country, began its capital credit program in 2007 to address member concerns that the co-op should have been issuing the payments in the past, as most other such utilities do. 

  The co-op also said that its board put a three-year contract in place for Garza that will run through 2012. 

  http://www.statesman.com/search/content/news/stories/local/2009/10/31/1031roundup.html

  From: watchdogs-bounces at pec4u.org [mailto:watchdogs-bounces at pec4u.org] On Behalf Of Paul Langston
  Sent: Sunday, November 01, 2009 12:44 PM
  To: PEC Watchdogs; "Juan Garza"; "Renee Oelschleger"
  Subject: [Watchdogs] news article, Austin American Statesman, 10-31-09, Page B-2, Utility to issue Member's checks

  PEC is going to issue up to $4 million in dividend-like payments to eligible members, with many receiving the money in the form of a check..for the first time.  

  My opinion:  It took a lawsuit, lots of time and effort of the Member-Owners to extract these Capital Credits.  The management of PEC simply held on to these Capital Credits for ever-so-many years BECAUSE  the king-fish said that they needed the money more than we did. They paid no interest.

  Question, couldn't you save a bundle of our money by simply crediting our monthly accounts?  The postage alone will be $80,000 to send out these checks.  The office overhead to send out these checks will be more than $50,000.

  The article in the Statesman ends with,"  The Co-op also said that its Board (of Directors] put a three- year  contract in place for Garza that will run through 2012."

  Opinion:  I must have missed that Board meeting.  Pretty important stuff.  Maybe the decision was made out in the middle of that cow patch at mid-night.

  For a long time, I have complained about our Mr. Garza working under a contract that was lovingly fashioned by Bennie R. Fuelburg Jr.  and his platoons of PEC-paid lawyers.

  I am sure that Mr. Bud Burnett and his Board of appointed Directors had feed into that contract of Mr. Garza.

  I have never thought that Mr. Garza was anything like free to do his job to his ability.  Rather,  he was  severely constrained by that Contract, the written part, the added-on side agreements and the secret verbal asides.

  I an so happy to hear that Mr. Garza is at last free to work solely for the Owner-Members of PEC.  

  We owe a big thanks to the new-elected members of the Board.

  Sincerely,  Hollis P. Langston   830-598-1322    

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