Mike Espy receives award at Federation’s 50th Anniversary

FederationMike Espy, former Secretary of Agriculture received the Estelle Witherspoon Lifetime Achievement Award on Thursday night in Birmingham as part of the Federation of Southern Cooperatives’ 50th Annual Meeting and anniversary. Shirley Blakely of Mississippi, Board Chair, joined by other board members and Cornelius Blanding, Executive Director, presented the award. The meeting continued Friday and Saturday at the Federation’s Rural Training and Research Center. More than 500 people attended the three-day celebration. The Federation was founded 1967 by 22 cooperatives and credit unions, arising out of the Civil Rights Movement, who banded together for mutual assistance, training and pooled resources. For more information, see the organization’s website at: www.federation.coop.

Judge Hardaway turns down request for injunction to stay the Black Warrior EMC By-law change vote

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By: John Zippert, Co-Publisher

After a three hour hearing on Friday, April 28, 2017, in the Linden Courthouse, Judge Hardaway dismissed a request by plaintiffs for an injunction to stay a mail-in election on new proposed bylaws.
The plaintiffs in the case of Rev. James Carter vs. Black Warrior Electric Membership Corporation have filed a lawsuit to compel the cooperative to operate in a more open, transparent and democratic manner in accordance with cooperative principles, Alabama law and IRS tax exemptions that Black Warrior enjoys as a rural electric cooperative providing power and other services to its members.
The plaintiffs have been seeking information on how the BWEMC is governed and operates across its 12 county area. The plaintiffs have been seeking copies of the by-laws, information on the Annual Meeting, the present composition of the Board of Directors, the boundaries of the districts from which board members are elected, the nominating committee and nominating process and many other details of the governance and operation of the cooperative.

Every household or business that has a Black Warrior power meter is a member of the cooperative and entitled to vote on major issues including the election of the board. This principle of “One Person-One Vote” is at the heart of the economic democratic functioning that distinguishes cooperatives from other forms of business organization and is also the basis of the cooperative’s special status with IRS.The Black Warrior EMC sent out a package to all members at the beginning of April including a new 25 page set of proposed by-laws, a flyer highlighting some of the changes in the new by-laws and a mail ballot for members to vote yes or no on the whole package at once. The deadline for submitting ballots on the by-law changes was May 1.
The plaintiffs in the case, represented by the Chestnut, Sanders and Sanders law firm of Selma, were seeking an injunction to block the mail-in ballot on the by-law changes or postpone the implementation of the by-law changes until the member plaintiff’s case was heard on an expedited basis. The plaintiffs wanted a full and open disclosure of how the co-op is governed and operating before a new set of by-laws went into effect.
Darryl Jones, General Manager of BWEMC and the lawyers representing him said that first there was no legal basis for an injunction to stop the by-laws vote; that the purpose of the mail-in ballot was prescribed by Alabama law and that this would allow more members to participate; and that they had already spent over $30,000 to send out ballots and had received 3,226 votes in the mail as of Friday’s hearing.
The plaintiffs argued that most members who received the by-laws package did not fully understand it and that a meeting or a set of district meetings was needed to explain the by-law changes to members. They also wanted more clarity on the scheduling of the 2017 Annual Meeting and the process for nomination and election of board members.
Attorney Hank Sanders called Darryl Jones to the witness stand and had him to place on record the operating history of the Black Warrior EMC. Jones stated that the cooperative has not had a quorum at its membership Annual Meeting for over 60 years since 1950. The lack of a quorum allows the Board of Directors to fill vacancies between meetings. Jones also stated, “ At this point no one serving on the BWEMC Board of Directors has been elected at a membership meeting. All persons on the board were selected and appointed by the board.”
Jones said the cooperative was operated in the interest of the members and you cannot force people to attend a meeting over long distances. Jones also testified that although changes were made in the by-laws, the quorum was not reduced from 5% of the membership (1300) to 3% (780) which is permissible under Alabama law and the idea of district meetings to elect the board members was not considered.
Attorney Ainka Sanders Jackson, one of the attorneys for the plaintiffs, said, “We put on our best case and I am disappointed with Judge Hardaway’s ruling. We clearly showed that the rural power cooperatives has not been operating democratically and changing the by-laws, without the membership understanding the new by-laws, will not make it more democratic. The members must remain vigilant; nominate people they want for the board; and attend and exercise their voting rights at Annual Meetings and other meetings called to determine the future directions of the cooperative. We plan to continue the case until we receive justice for the members of Black Warrior EMC.”
Persons interested in supporting the plaintiffs campaign for justice and democracy at the Black Warrior rural electric cooperative, may contact Ms. Adriauna S. Davis at the Federation’s Rural Training and Research Center, at 205/652-9676 or more information.

Black Warrior EMC members file for an injunction to stop vote on by-law changes to stop vote on by-law changes

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Demopolis, AL – Member-owners of Black Warrior EMC, a rural electric cooperative serving western Alabama, asked the Greene County Circuit Court on Friday, April 21, 2017, to stop the Black Warrior Board of Directors from trying to amend the cooperative’s bylaws by mail-in ballots, a move these member-owners claim is unlawful.
In their motion to the court for a preliminary injunction to halt the balloting, the member-owners allege that, under Black Warrior’s current bylaws, changes to the bylaws can only be approved at a meeting of the members. They further allege that the proposed changes would “increase the Board’s power considerably at the expense of the members.” Black Warrior has not called for a members’ meeting prior to the May 1st deadline for mailing the ballots on the proposed bylaws.
The law firm of Chestnut, Sanders and Sanders of Selma, Alabama, filed for the injunction on behalf of a group of members who are also plaintiffs in a pending lawsuit challenging the failure of Black Warrior to hold annual elections for its board of trustees, as required by the current bylaws.
According to Aaron Hodge of the Boyd community in Sumter County, one of the plaintiffs, Black Warrior EMC has not had a member-elected board “in decades.” The plaintiffs allege that the current management and board have not taken steps to ensure that a quorum of the membership (at least 1,300 members) attend the annual meetings so that business – such as electing a new board — can be conducted in a fair, open and democratic manner. The current by-laws require a quorum of 5% of the total membership (26,000 members) to attend a meeting for it to be an official formally recognized meeting at which the organization’s business can be conducted.
“The people running Black Warrior act like they don’t want members to know what’s going on,” Mr. Hodge said. Ethel Giles, a community leader in the Forkland area, agreed, stating, “Black Warrior doesn’t communicate with its members, except for sending out the bills.” Ms. Giles said that she and several other member-owners have gone to the Black Warrior office at different times to request basic information about the electric cooperative and its board election process but their requests were always rejected.
Although it recently upgraded its website to provide more information, Black Warrior has not made key documents available to the members. “They don’t even make the service district maps public so that we know which district we’re in and who on the board is supposed to be representing our district,” said Mrs. Giles.
If the proposed bylaws were to pass, Black Warrior EMC’s board would be empowered to create at-large seats on the board, in addition to the seats based on geographic service districts. The current bylaws call for approximately equal numbers of members per service district, but this requirement has been eliminated in the proposed bylaws, as have the provisions for proxy voting. Only members who attend meetings in person would be counted for the quorum, unless, at some future date, the board adopts “alternative means” for determining quorum and for voting.
In March, Black Warrior sent the members of this rural electric cooperative a package containing the proposed new bylaws and a ballot, with a letter asking them vote, by May 1, 2017, to support the changes. Members can only vote “yes” or “no” on all the proposed changes, some of which are identified in a summary but many of which are not. The 25 pages of proposed bylaws do not provide a comparison with the current bylaws so that the member-owners can understand exactly what is being changed.

As a tax-exempt rural electric cooperative, Black Warrior EMC is supposed to be governed by the Seven Principles of Cooperative Governance, which include democratic control of the cooperative by the member-owners and payment of annual patronage dividends to the members, among other things. Black Warrior was recently sued in a class action lawsuit to recover patronage dividends going back to 1975. The settlement of that lawsuit is being appealed. Earlier this year, Black Warrior mailed patronage dividend checks to it members for the first time in many years. These checks were for the time periods after those included in the lawsuit.

The Federation of Southern Cooperatives, in Epes, has been supporting the campaign by Black Warrior member-owners for democratic governance at their electric cooperative. Adriauna Davis, the Federation’s staff organizer, said that although some of the changes might improve member participation – like extending the period for holding the annual meeting by a few months – most of the changes are detrimental to member democracy. “The Federation, after meeting with community residents, who are concerned about Black Warrior EMC’s operations decided on a strategy of advising Black Warrior member-owners, who contacted us, to vote “no” on the proposed amendments to the bylaws,” she said.
Members of the Black Warrior electric cooperative may contact Ms. Audriauna Davis at the Federation’s Rural Training and Research Center, near Epes.
For more information, by calling
1-205-652-9676 or emailing her at: adriaunasdavis@gmail.com.