Embattled Tri-County Electric Co-Op board resigns after customers vote on ouster

Embattled Tri-County Electric Co-Op board resigns after customers vote on ouster
Published: Aug. 22, 2018 at 1:21 PM EDT|Updated: Aug. 23, 2018 at 6:44 AM EDT
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ST. MATTHEWS, SC (WIS) - A few days after more than 1,000 Tri-County Electric Cooperative customers voted them out during a weekend meeting, the board of trustees for the utility company has resigned, per legal documents filed in Calhoun County.

The settlement, filed in Calhoun County common pleas court on Tuesday, says the remaining board of trustees would drop a June 2018 lawsuit filed against the cooperative and they would relinquish their roles as members of the board. In addition, they would not attempt to file subsequent civil actions against the cooperative or any customers. In return, the cooperative would pay the legal fees, totaling $125,000.

Moreover, the members have agreed not to challenge the Aug. 18 vote where a quorum of 1,452 customers voted to fire the remaining board members, with only 30 voted against their firing. Additionally, customers approved new bylaws by a vote of 1,322 to 155.

Board members didn't show up to two fiery meetings where they were scheduled to meet with upset customers and the CEO, Chad Lowder. The second meeting, which was rumored to be the board voting to fire Lowder and call Saturday's vote illegal, ended with customers, legislators, Lowder, and journalists entering the boardroom with the trustees for a testy face-to-face.

MORE: A fiery crowd shouts at Tri-County Electric Co-Op board members to resign at a  July meeting

But the Saturday vote did happen, and a large crowd gathered to oust the board. Saturday's meeting was scheduled for 30 days after cooperative customers gathered enough signatures to schedule the meeting and the board was given proper notice of those proceedings, a sworn affidavit says.

Following Saturday's vote, a letter released by the cooperative says customers will be able to vote on new board members later this year.

In May, Roy C. Smith, of Richland County, filed a class action lawsuit against Tri-County Electric Co-Op seeking to represent all of the customers who paid bills to the co-op from May 22, 2015, to the present date and excludes any board members, trustees, or employees.

Smith says because the cooperative continues to violate S.C. Code Ann. § 33-49-630 by "awarding its trustees compensation that vastly exceeds reasonable expenses" back to them. According to tax filings, six of the nine board members have received in excess of $100,000 per year in compensation since 2004.

"Tri-County Electric maintains its tax-exempt status 'only if 85 percent or more of the income consists of amounts collected from members for the sole purpose of meeting losses and expenses,'" the lawsuit says. "The Electric Cooperative Act also provides for the retirement of 'patronage capital,' which is 'the amount by which the cooperative's electric revenues exceed its costs of doing business.'"

Allegations of excessive compensation for Tri-County board members have prompted customers to circulate a petition for their removal from office.

Tri-County Electric Cooperative customers have until September 11 to submit any objections to a recent settlement about the former board.

Tri-County serves about 13,000 customers in Richland, Calhoun, Lexington, Orangeburg, Kershaw, and Sumter counties.

You can read the settlements here and here.

Also on Tuesday, State Representative Wendy Brawley (D-Richland) issued a letter seeking a federal investigation into any "possible corruption and other illegal activity" from the dismissed board members.

Check back for more updates.

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