[Watchdogs] The Board Salaries and the Staff Salaries

[Clyde Doyal]

I served on the Board of Trustees for a school district with over thirty 
thousand students and quite likely with more employees than the PEC(and without 
any deadheads of course).  I received no compensation and we met once a month 
unless a special called meeting occurred.  While over seeing the educational 
process may not be as complicated as serving on a board of an entity that buys 
one product(electricity) and distributes that product to its member owners, it 
is a considerable undertaking.  There was never a shortage of candidates willing 
to devote their time to serving on the board.  My problem with a generous 
compensation package for directors is that they tend to act as employees rather 
than overseers.  The threat of losing such compensations is tantamount to a 
person losing their job and takes away the independence of members whose only 
motive should be to see that the utility is run in an efficient manner. As long 
as board members are paid like an employee they are not likely to rock the boat 
when it comes time to get rid of deadwood or other feeders at the trough.  Clyde 
Doyal




________________________________
From: Milton Hawkins <milton.hawkins at gmail.com>
To: Watchdogs <watchdogs at pec4u.org>
Cc: alfred stlouis <stlouis_98 at hotmail.com>; Mary Ann Raesener 
<marinctx at nctv.com>
Sent: Wed, September 15, 2010 2:43:15 PM
Subject: Re: [Watchdogs] The  Board Salaries and the Staff Salaries

 
Friends,
 
We might take a look at what the directors of LCRA make.  LCRA has a certain 
size, like PEC, and the directors there have large responsibilities as well.  
I’m attaching relevant parts of LCRA Board policy, and copying below the primary 
information:
 
Directors are not entitled to fees for routine or ministerial activities such as 
the execution of
documents or self-preparation for meetings, or other activities requiring a 
minimal amount of time.
Directors will receive as fees of office $150 for each day of service necessary 
to discharge their
duties, plus actual expenses, if and only if the compensation and expenses are 
approved by vote of
the Board of Directors. The $150 daily fee may only be charged in its entirety 
and not modified to a
lesser amount.
 
No Director shall be paid fees in excess of one hundred fifty (150) days in any 
one calendar year or
as otherwise established by State law. 
 
 [http://www.lcra.org/about/leadership/board/policies.html ]
 
My understanding is that LCRA directors do not get paid for anywhere near 150 
days a year, but even if they made it almost a half-time job, the total would be 
only $22,500.
 
Naomi, you are correct in that PEC’s directors are paid a “monthly fee” of 
$1,500, plus $750 for each Board meeting, and $500 for committee meetings (up to 
12 committee meetings a year).  Mary Ann is correct, too, in that the Bylaws 
preclude payment of a “salary.”  Instead, we have lots of talk about fees and 
expenses:
 
Section 6. Compensation. Directors
and Advisory Directors shall not receive
any salaryfor their services solely as a
Director or Advisory Director. By resolution
of the Board of Directors a fixed sum and
reasonable expenses of attendancemay be
allowed for attendance at each meeting of
the Board of Directors, and for attendance
at each committee meeting. By resolution
of the Board of Directors, Directors and
Advisory Directors shall be allowed a
monthly fee and reasonable expensesfor
meetings other than Board meetings. [emphasis mine]
 
As I’ve suggested before, I think eliminating the $1,500 monthly fee for 
directors and maintaining a reasonable fee, plus expenses, for actual attendance 
at Board and committee meetings is a good approach to this issue.  The directors 
ought to set the example, and then insist on some serious evaluation (and 
reduction) of salaries at the top of the management pyramid at the cooperative.
 
Regards to all,
 
Milton
 
Milton  Hawkins    milton.hawkins at gmail.com    830-868-9075

________________________________
 
From:Watchdogs-bounces at pec4u.org [mailto:Watchdogs-bounces at pec4u.org] On Behalf 
Of alfred stlouis
Sent: Wednesday, September 15, 2010 12:18 PM
To: watchdogs at pec4u.org
Subject: [Watchdogs] The Board Salaries and the Staff Salaries
 
I would like to see the Board set the example for the COOP by voting to cut 
their own Salary by a modest amount, say 5%, and then work to reduce the many 
overpaid staff salaries.  Too many staff are making over $200K per year!  Al
 
> From: watchdogs-request at pec4u.org
> Subject: Watchdogs Digest, Vol 29, Issue 8
> To: watchdogs at pec4u.org
> Date: Wed, 15 Sep 2010 12:00:03 -0500
> 
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> 
> Today's Topics:
> 
> 1. Re: Compensation for Board members. (Pat Scott)
> 2. Re: Compensation for Board Members (Doug Moore) (Naomi Byrne)
> 3. Re: Compensation for Board Members (Doug Moore) (Naomi Byrne)
> 4. Re: Compensation for Board Members (Doug Moore)
> (tbuckle at austin.rr.com)
> 
> 
> ----------------------------------------------------------------------
> 
> Message: 1
> Date: Tue, 14 Sep 2010 11:21:27 -0700 (PDT)
> From: Pat Scott <sanleanna at yahoo.com>
> To: watchdogs at pec4u.org
> Subject: Re: [Watchdogs] Compensation for Board members.
> Message-ID: <769923.72104.qm at web112006.mail.gq1.yahoo.com>
> Content-Type: text/plain; charset="iso-8859-1"
> 
> Thank you . Mr. Moore for a very illuminating explanation of the job the 
>Directors now do. I think most of us were still under the impression?it was 
>still as before maybe not rubber stamping, but going along.?Given? workload 
>listed - for now - the compensation question can wait until the business is 
>running?a lot more efficiently.
> ?Thanks for your?insight and comments.
> Pat Scott
> District 7 Resident??
> Pat Scott(semi retired)
> "Whenever the people are well informed, they can be trusted with their own 
>government; that whenever things get so far wrong as to attract their notice, 
>they may be relied on to set them to rights." 
>
> Thomas Jefferson
> 
> 
> Today's Topics:
> 
> ???1. Re: Compensation for Board Members (Doug Moore)
> 
> 
> 
> 
> 
> 
> 
> ****************************************
> 
> 
> 
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> ------------------------------
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> Message: 2
> Date: Tue, 14 Sep 2010 13:35:33 -0500
> From: "Naomi Byrne" <naomiw at austin.rr.com>
> To: <watchdogs at pec4u.org>
> Subject: Re: [Watchdogs] Compensation for Board Members (Doug Moore)
> Message-ID: <009c01cb543b$9f4712f0$ddd538d0$@rr.com>
> Content-Type: text/plain; charset="us-ascii"
> 
> Doug - 
> 
> When I read your posting, I had to respond. 
> 
> I understand everything you are saying - yes, it's hard work, and yes, it's
> time consuming. But do I think that board members should be compensated for
> a voluntary position? I have to say emphatically "No".
> 
> Every Board will eventually run into tough times, requiring its board
> members to work hard and long hours to keep the entity going. However, that
> doesn't justify paying someone for their service. Once PEC is humming along,
> will the Board cut their pay? Probably not. Pay shouldn't be based on how
> hard the work may be at one point in time, because (hopefully) if you do
> your job as board members, it will get better. 
> 
> Second - it's not a full-time job nor should it be. If the Board is spending
> that much time managing the managers, then the board is overstepping its
> bounds. You mentioned that some managers took too long to complete tasks
> assigned by the Board - I can only hope and assume that the Board was
> working through their ONE employee, Juan Garza  (now his replacement), rather
> than directly managing other staff. And the board has chosen to spend "long
> hours reading, analyzing and writing papers". Want more help? Recruit
> committee members from the general PEC population. There are PLENTY
> intelligent and conscientious folks who I am sure would love to assist, and
> do so for free. Heck - Joe and Milton write stuff all the time, and he's
> just an "observer". Or do what the Board has done - fire the CEO and hire
> one that does what you want, when you want it. 
> 
> Third - I don't believe for a second that we should have to compensate a
> board for making a "tough decision". That's what they are there for, period.
> Can make the tough calls without change in your pocket? Then you don't need
> to be there. We obviously did not lack for any volunteers, as evident during
> the last election cycles. 
> 
> Now, none of this is directed specifically towards your wife or the other
> board members. But I am suspect when I have to pay folks to do what is a
> volunteer job. Great - you decreased compensation and removed health
> insurance, but to me, that's not enough. Pay them travel time, mileage, a
> stipend for attending the meetings, and reimbursement for receipted supplies
> used in the course of their Board work. But quit paying them an annual
> salary - if they want to work for PEC, then they need to apply and get on
> the other side of the table. It was the good ol' boys who started the crap
> of compensation - let's NOT use their failings as an excuse to continue
> their bad habits. 
> 
> 
> Naomi Byrne
> Leander ,  TX 
> 
> 
> 
> 
> ------------------------------
> 
> Message: 3
> Date: Tue, 14 Sep 2010 17:57:34 -0500
> From: "Naomi Byrne" <naomiw at austin.rr.com>
> To: "' Mary Ann Raesener '" <marinctx at nctv.com>
> Cc: watchdogs at pec4u.org
> Subject: Re: [Watchdogs] Compensation for Board Members (Doug Moore)
> Message-ID: <00fb01cb5460$39a35470$ace9fd50$@rr.com>
> Content-Type: text/plain; charset="us-ascii"
> 
> Mary - 
> 
> I may have misspoken, but I didn't misunderstand. What the PEC Directors
> earn, whether you call it a salary, stipend, flat fee, compensation - it is
> money paid for their service. Last I recall, Directors got $1500 per month
> flat fee, plus fees for each meeting. Is this wrong? If I've missed another
> decrease in compensation, I'll eat my hat - no problem. But, based on the
> last few watchdog emails, it seems that the Directors still get $1500 per
> month flat fee, plus $500 - $750 per meeting they attend. If you are only on
> one committee and have one meeting a month, you are still pulling down at
> least $2,750 per month ($33,000 per year). That's a salary, no matter what
> you call it. 
> 
> The way I see it now, if I am a Director, I could realistically attend one
> committee meeting for three hours and do three hours of prep, and get paid
> over $80.00 per hour. If I attended just one regular meeting for three hours
> and did three hours of prep, that's another $125.00 per hour. Neither of
> these includes the $1500 flat fee I get just for being a Director, even if I
> don't attend a meeting, so I could NOT read my board packets, NOT go to a
> meeting, NOT participate in a discussion and still get $1500 per month.
> (Actually, this is better than a salary - I don't have to do any work to get
> paid.) 
> 
> Seriously, though - I never said that the Board members should not receive
> compensation for their time and travel, but this is NOT THEIR JOB.
> Compensation has to be reasonable, and getting over $27,000 for just being
> in a voluntary (albeit elected) board position is not reasonable. And the
> argument that this would limit the pool of candidates doesn't hold water -
> look at how many companies, entities, municipalities, etc... have minimal or
> no stipends and have excellent Board members with the knowledge and the
> skills to oversee and manage an agency, and look at how many companies,
> entities, municipalities, etc... PAY stipends and still have Board members
> that do stupid things. It's about the people, not how much you have to pay
> to get them there. 
> 
> Naomi Byrne
> Leander ,  TX
> 
> 
> 
> -----Original Message-----
> From: Mary Ann Raesener  [mailto:marinctx at nctv.com] 
> Sent: Tuesday, September 14, 2010 5:07 PM
> To: 'Naomi Byrne'
> Subject: RE: [Watchdogs] Compensation for Board Members (Doug Moore)
> 
> Naomi appears to have misunderstood. PEC Board members do not get a salary.
> They get a flat fee for attending each Board meeting and a lesser amount for
> committee meetings, plus documented expenses for mileage. The argument by
> Fraser and others is that they should receive nothing but should donate
> their time (currently 30+ hours per week) without any compensation at all -
> for the honor of serving. That would limit the pool of candidates - if they
> understand the job requirements.
> 
> Mary Ann Raesener
> Meadowlakes ,  TX
> 
> 
> 
> 
> ------------------------------
> 
> Message: 4
> Date: Wed, 15 Sep 2010 4:31:26 +0000
> From: <tbuckle at austin.rr.com>
> To: ' Mary Ann Raesener ' <marinctx at nctv.com>, Naomi Byrne
> <naomiw at austin.rr.com>
> Cc: watchdogs at pec4u.org
> Subject: Re: [Watchdogs] Compensation for Board Members (Doug Moore)
> Message-ID: <20100915043127.286B9.285365.root at hrndva-web08-z02>
> Content-Type: text/plain; charset=utf-8
> 
> Guys, This is a tough one. I have been on numerous Boards of Directors of 
>non-profit corporations, on a city council, on the board of an appraisal 
>district, and on a number of professional committees of my profession....and 
>have never been paid one cent for that service. But, I have never had to be 
>responsible for an entity that had more than 1 to 2% of the revenues as the PEC. 
>You really need to consider that this Board is really a Board of a major 
>corporation...not a local entity that does not require that much time or has 
>responsibilities that if they screwed up, could do much damage. Remember the 
>damage done to the PEC by a Board that did not supervise, inquire, or work. I do 
>not know of a major city that does not pay a decent wage to the members of its 
>city council. I think the reason is pretty clear as to why they do.
> 
> ---- Naomi Byrne <naomiw at austin.rr.com> wrote: 
> > Mary - 
> > 
> > I may have misspoken, but I didn't misunderstand. What the PEC Directors
> > earn, whether you call it a salary, stipend, flat fee, compensation - it is
> > money paid for their service. Last I recall, Directors got $1500 per month
> > flat fee, plus fees for each meeting. Is this wrong? If I've missed another
> > decrease in compensation, I'll eat my hat - no problem. But, based on the
> > last few watchdog emails, it seems that the Directors still get $1500 per
> > month flat fee, plus $500 - $750 per meeting they attend. If you are only on
> > one committee and have one meeting a month, you are still pulling down at
> > least $2,750 per month ($33,000 per year). That's a salary, no matter what
> > you call it. 
> > 
> > The way I see it now, if I am a Director, I could realistically attend one
> > committee meeting for three hours and do three hours of prep, and get paid
> > over $80.00 per hour. If I attended just one regular meeting for three hours
> > and did three hours of prep, that's another $125.00 per hour. Neither of
> > these includes the $1500 flat fee I get just for being a Director, even if I
> > don't attend a meeting, so I could NOT read my board packets, NOT go to a
> > meeting, NOT participate in a discussion and still get $1500 per month.
> > (Actually, this is better than a salary - I don't have to do any work to get
> > paid.) 
> > 
> > Seriously, though - I never said that the Board members should not receive
> > compensation for their time and travel, but this is NOT THEIR JOB.
> > Compensation has to be reasonable, and getting over $27,000 for just being
> > in a voluntary (albeit elected) board position is not reasonable. And the
> > argument that this would limit the pool of candidates doesn't hold water -
> > look at how many companies, entities, municipalities, etc... have minimal or
> > no stipends and have excellent Board members with the knowledge and the
> > skills to oversee and manage an agency, and look at how many companies,
> > entities, municipalities, etc... PAY stipends and still have Board members
> > that do stupid things. It's about the people, not how much you have to pay
> > to get them there. 
> > 
> > Naomi Byrne
> > Leander, TX
> > 
> > 
> > 
> > -----Original Message-----
> > From: Mary Ann Raesener  [mailto:marinctx at nctv.com] 
> > Sent: Tuesday, September 14, 2010 5:07 PM
> > To: 'Naomi Byrne'
> > Subject: RE: [Watchdogs] Compensation for Board Members (Doug Moore)
> > 
> > Naomi appears to have misunderstood. PEC Board members do not get a salary.
> > They get a flat fee for attending each Board meeting and a lesser amount for
> > committee meetings, plus documented expenses for mileage. The argument by
> > Fraser and others is that they should receive nothing but should donate
> > their time (currently 30+ hours per week) without any compensation at all -
> > for the honor of serving. That would limit the pool of candidates - if they
> > understand the job requirements.
> > 
> > Mary Ann Raesener
> > Meadowlakes ,  TX
> > 
> > 
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