South Carolina

SC utility’s board thrown out of office by more than 1,500 customers at meeting

Tri-County Electric board voted out in historic co-op meeting

After the Tri-County Electric board was caught enriching themselves while customers paid high rates, more than 1,500 co-op members successfully voted to oust the board in a historic meeting August 18, 2018.
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After the Tri-County Electric board was caught enriching themselves while customers paid high rates, more than 1,500 co-op members successfully voted to oust the board in a historic meeting August 18, 2018.

For weeks, Tri-County Electric customers worried they might not have the 700 votes necessary to throw out the co-op’s embattled board of directors at an unprecedented meeting.

Then Saturday morning, more than 1,500 customers showed up, filling a football field’s worth of metal chairs under a concrete pavilion. They voted 1,452-30 to sack the board and 1,322-155 to limit the pay of future trustees.

“Unbelievable,” Tri-County general counsel John Felder said as he stepped up to a microphone and faced the crowd. “If you aren’t humbled and you aren’t awed by this turnout and by the turnout (at a board meeting) yesterday, then I think you seriously need some counseling.”

Tri-County’s customers — including hundreds who had never attended a co-op meeting — drove to St. Matthews from six counties Saturday morning to overthrow a part-time board that had paid itself more than three times the national average, including health insurance plans and expensive perks.

Not one member of the crowd rose to defend the board, which has hinted it could challenge the Saturday vote in court. But customers lined up near microphones during the hourlong meeting to rip the six remaining trustees — who didn’t attend — for betraying the community’s trust.

“This group of people is leading the way to put folks on notice that enough is enough,” state Rep. Russell Ott, D-Calhoun, told the crowd. “We’re not going to stand for it anymore. We work too hard for our money to have it go and enrich other people.”

More than 1,000 customers showed up Saturday morning for a vote on whether to fire Tri-County Electric Cooperative's board. Records showed the board members had spent thousands on committee meetings and bonuses.

The vote comes three months after The State newspaper revealed that Tri-County’s part-time board had paid itself about $52,000 per member — the highest of any co-op board in South Carolina — and then successfully campaigned against a proposal to limit its own pay.

Board members are tasked with keeping costs low for the co-op’s rural customers, who also are its owners. But for years, they had boosted their own pay with co-op-funded health and life insurance plans and by racking up $450-a-day payments for attending an inordinate number of board meetings. Members also enjoyed expensive dinners, $300 Christmas bonuses normally reserved for employees and retirement plans that paid out nearly $81,000 to each member in 2008.

Over a three-month span, the co-op and its board have been hit with two lawsuits on behalf of customers. Members refused repeated calls to resign that came from Tri-County customers, state lawmakers and the Electric Cooperatives of South Carolina, the trade association that represents the state’s 20 electric co-ops.

Within two months, Tri-County’s customers gathered the 1,600 petition signatures necessary to force Saturday’s special vote to throw out the board, exercising a co-op rule that had never been used in South Carolina.

Tri-County’s customers have packed board meetings to grill the trustees, but Saturday’s gathering marked the third straight day the board refused to come out and face them.

Saturday’s meeting was hailed as proof that the co-op model of governance — in which the business is owned by its customers — works, offering a chance to purge wrongdoing when necessary.

“What I’ve seen today are two fundamental, unique American institutions work very, very well,” said Mike Couick, CEO of the Electric Cooperatives of South Carolina. “One is a free media, and one is a working ballot box. Here they gave us a co-op back and gave us their principles back. Every co-op member, every co-op person ought to feel very thankful for both institutions.”

Saturday’s meeting brings some closure for those Tri-County customers — 13,600 of them in Calhoun, Orangeburg, Richland, Lexington, Kershaw and Sumter counties. But it might not be the end of the story.

Tri-County’s current board, while quiet, has hinted through its attorneys that it could challenge the validity of Saturday’s meeting, which was called by customers without the board’s consent. The co-op’s leaders, including chief executive Chad Lowder and general counsel Felder, have insisted the customer-called meeting is legal even after the board refused to approve it.

On Friday, the board called a secret meeting and attempted to fire Lowder. But those plans were thwarted when about 225 Tri-County customers and employees crashed the meeting, and when a judge issued a temporary restraining order blocking the trustees from retaliating against the co-op’s staff.

The last-minute move only galvanized Tri-County’s customers. More than 700 customers showed up to vote by 9:15 a.m. Saturday, blowing past the attendance number necessary for the vote to count. And more were on the way.

“Thank goodness there was a process for you, and you used it,” state Rep. Wendy Brawley, D-Richland, told the crowd. “This is a signal that is going to ring across the United States of America. … There are co-ops all across America that are watching you today.”

Jeff Reeves and Barry Hutto, two former Tri-County board members who resigned in protest after their colleagues campaigned against the proposed pay changes in May, said they were overwhelmed at the sight of the crowd Saturday. Those same pay changes were approved in a separate vote Saturday.

“I feel like a burden has been lifted today. I talked to some employees. They are so happy right now,” Reeves said. “The members spoke today, and boy it was just amazing. It was that wow factor.”

Hutto said he was moved to see all the customers who had never attended a board meeting. “These people will come back and be at all the meetings and keep things straight,” he said.

Roy Smith, a Hopkins resident who is suing the board, called the Saturday meeting “humbling and thrilling.”

“We wanted to identify the problem, bring it to light, remove the present board and to hold them financially responsible,” Smith said, adding he won’t drop his lawsuit, which seeks to claw back money the board was paid. “The customers turned out in unbelievable numbers today, and I’m just delighted.”

Barring a court ruling, the co-op’s customers will meet again Nov. 17 to elect a new nine-member board.

A group of Tri-Countymembers and members of the media watched as a temporary restraining order was issued to the remaining members of the board.

Reach Wilks at 803-771-8362. Follow him on Twitter @AveryGWilks.
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