CoServ Candidates Debate the Issues

Pam King
Published 05/29/2009 - 11:49 a.m. CST

L to R: Richard Yerxa, Mary Sue Friesenhahn and Mark Pape at the Highland Village CoServ Watchdogs forum.

Things need to change. Those words were echoed by all three CoServ District 5 Board Candidates, Mary Sue Friesenhahn, Mark Pape and Richard Yerxa, running against incumbent Board member, Anne Vaden.

CoServ Watchdogs (www.CoServWatchdogs.org), which calls itself a CoServ Member Advocate Group, hosted a 2009 CoServ Board of Directors, District 5, Candidates Forum, at Highland Village City Council Chambers, Friday evening, May 22, 2009. Bob Weir, Editor of The News Connection, served as moderator. Weir told candidates The News Connection would be available to publish interviews of each of the District 5 candidates and their positions. CoServ, a cooperative power company, holds annual District Board of Director elections by its 140,000 members. The seven District representatives serve staggered, three year terms on the CoServ Board. The 2009 ballots will be available in the June issue of the Texas CoOp Power magazine and must be submitted by the June 23, 2009 Annual Meeting.

While incumbent District 5 Director, Anne Vaden, was unable to attend the Candidate Forum, her three challengers, Friesenhahn, Pape and Yerxa, were on-hand to provide information and answer questions for the audience, as well as those watching via the local cable access channel. Yerxa said, in his opening statement, he supports the cooperative organization and its low-cost electric supply but believes the nonprofit utility should maintain transparency for the members it serves. As a 30-year businessman, Yerxa believes he has the experience necessary to provide management direction, open lines of communication and to be a guardian of member interests. Friesenhahn told the audience, as a long-time resident of the area and, with a background in non-profits and budgets, she feels she can address the lack of information on what the Board is, how it works, and how

to better educate members on their role within their co-op. Pape has 35 years of high level corporate experience and service on the boards of public, private and non-profit corporations that qualify him to ensure CoServ provides low-cost electric rates and good service, while keeping members informed.

Opening statements were followed by a series of 15 questions posed to each of the candidates by the Moderator. The candidates consistently spoke of the lack of public disclosure, open, accessible records regarding earnings, expenses, salaries, investment and financial risks, pending lawsuits, board meeting agendas and minutes. They concurred the estimated 140,000 CoServ Members, the owners of the Cooperative, need to be better informed and educated by CoServ and its Board of Directors. As Pape put it, Were stuck: we cant sell our shares if we dont like the way things are being run! Yerxa said transparency was vital. Friesenhahn said, the whole reason were all running is because [CoServ] isnt being run with the transparency were due. It is being run without member consent or knowledge. In response to the question, What is your view of CoServs financial condition, Yerxa said, Precarious, continuing that four of the board members who served in 2002 when CoServ filed for bankruptcy continue to serve and that he questioned CoServs investments in, among others, hotels and commercial property. Friesenhahn said she is, concerned about winding up in another bankruptcy. Were not seeing where the monies are invested. Papes reply was, the numbers are not being shown to us: thats a red flag. I am suspicious, he continued. I am concerned things are not good for the long term.

The candidates were also of like minds in their views on the issues of coal-fired power generation in Texas, global warming and increasing renewable energy sources. Yerxa said, Texas has the highest coal use in the country and because it is the cheapest, most abundant resource we have, we should continue to use it until other [energy] sources are more accessible and cost effective. Friesenhahn told the audience, We must stay focused on the mission: providing clean, reliable energy. Because it is necessary to keep costs down, coal is going to have to be used. Lets reevaluate other options later. Pape said, We must do whatever we can to minimize our impact on the earth; unfortunately, coal is a very dirty fuel. Because coal is currently the cheapest source of fuel, however, Pape believes CoServ should continue to use it until alternative, cost-effective fuels become available.

The candidates fielded several questions from the audience, including What makes you different from the incumbent? Friesenhahn replied, Just being involved in this process, Ive learned a lot. I live to be involved, make changes and do good things. Pape answered, I have been a CEO and served on Boards for over 35 years, improving corporate governance. I am very detailed and numbers-oriented. Yerxa replied, I am not afraid to say what I think. I have the time, Ive studied the situation and if we could get three or four new Board members, we could make some changes. In closing, Pape told the audience, Its time to hold Managements feet to the fire and communicate to membership. Dont give up your right to vote

and make change. Friesenhahn said, Its time CoServ had new blood. It will take us, as members, to make change. Yerxa commented, Ive learned from this process our biggest problem is lack of transparency. We need to make our Directors accountable and we need to change our members awareness.