Editorial: Come together and Save The Coop

By: Bill Whaley
12 October, 2012

Okay Taosenos, we must stand together and save the Coop from mismanagement re: Broadband. As the RUS letter makes clear, the project cannot be separated in an independent subsidiary at this time. According to reports from KCEC about $12 million has been spent. When the project is complete, it will be capitalized at about $80 million, according to the CEO’s written testimony. Then the Coop can turn a “division” into a “subsidiary” at which time the cash flow should support the debt.

The Broadband project might take two years or more to complete. According to CEO Reyes, the grant of more than $40 million plus the loan of some $17 million or more should make the project worth about $80 million. So KCEC members will have invested only about 25% of the total and could even divest itself of the entity at a discount and still pay back its RUS loan.

None of the interveners oppose Broadband. They have made that clear in public meetings and before the PRC. But all KCEC members want the Coop to survive on sound fiscal footing.

The CEO’s actions have created divisiveness and paranoia in the community, due to misrepresentation, exaggeration, and negligence. The KCEC Board of Trustees needs to rein in their CEO, who has ignored both the PRC and RUS Broadband directives when it comes to notification. The current crisis, which has thrown a hundred or more locals out of work, was completely avoidable, had Reyes responded to the PRC directive shortly after it was issued in the fall of 2011 by notifying RUS’s Broadband division and negotiating with the PRC and the Interveners.

In the past, Luis has played fast and loose with board policy. He once renewed a contract for over $500,000 without following the KCEC bid process and was forced to apologize to the Trustees for the alleged “oversight.” The board should hire a watchdog CFO—Chief Financial Officer—who reports directly to the Trustees and not to Luis.

The Coop is not meeting its “Tier” or margins for going on three years and is in technical default on its loans—the Coop’s cash appears to be going out faster than it is coming in despite the Broadband grant. As well, he has created an unfortunate if understandably hostile relationship with TRI-State, the Coop’s G&T provider. Some battles you can’t win. Tri-State is prepared to spend close to two million dollars of “our” money in an effort to fight the KCEC rate protest—with “our” money–at the PRC next year.

Luis has vision and energy—he’s a one-man think tank, public relations maven, and micromanager, not to mention energizer bunny. He reminds me of Butch Cassidy: he’s always thinking, that’s what he’s good at.

But he’s brow beating the Town of Taos into subsidizing the Coop Command Center by using a carrot and stick with local businessmen, who are also elected leaders, but benefit from contracts at the Coop. The trustees themselves have picked the Coop’s pocket– special contracts for family members, tree trimming and woodpiles for supporters, and used power poles for cronies. For years Luis and the Trustees have covered up their own peccadilloes—travel, cronyism, and petty paybacks for votes vis-a-vis the quid pro quo. All the cuates are in on the Broadband gold rush: Luis is the pied piper.

But Luis has also antagonized Taos County, according to his report at the September meeting. Now he blames one county commissioner and the commissioner’s brother for a slowdown in the permit process that has delayed the Broadband project. All of us can sympathize with anyone who takes on the County but Luis’s record of undermining himself and the Coop is growing broader and deeper.

We all know that Taosenos love to fight and Luis figures he’s way smarter than the rest of us. And he might be. But now we need to cooperate and save the Coop, use best management practices and hire a manager or CFO, who is not a lightning rod for trouble. The man in the white hat is waiting outside for Luis and you know what happened to Butch and Sundance at the end of the movie.

The Board of Trustees should take responsibility for their lack of oversight. Resolve the issue with the PRC, reassure RUS, and put the guys back to work. And give Luis some well-earned vacation time. He should be put on administrative leave until the Trustees can iron out the financial chaos at the Coop. Surely, Luis is not the only smart guy in northern New Mexico.

Save the Coop, Save Broadband, Save our Sanity.

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