Candidates for HEA board discuss how they would have better prepared members for big rate increase </MCC HEAD>

Story last updated at 8:30 PM on Wednesday, April 8, 2009

Candidates for HEA board discuss how they would have better prepared members for big rate increase

By McKibben Jackinsky
Staff writer

Five candidates running for Homer Electric Association's board of directors District 3 -- Kasilof south to the Kachemak Bay area -- were asked by the Homer News if HEA's 20,000 cooperative members could have been better prepared for rate increases they experienced this winter.

"I think it could have been handled a little differently in respect to I think they could have given a little more advance notice," said Steve Franklin, an eight-year-HEA member. "Whether HEA had advance notice or not, I'm not sure and without being in the loop, so to speak, I don't have that answer. The only thing that bothers me is that I feel HEA may have taken advantage of the membership by charging for December usage at a higher rate. I understand that the RCA approved the increase for starting January 1 billing date."

Franklin suggested January usage could have been prorated. Noting this would have "taken a little extra effort on HEA's part," Franklin suggested HEA's "accounting process maybe could use a little overhaul."

Eugene (Jim) Levine, a 14-year-member of HEA, suggested HEA could have sent a letter notifying each of the co-op's members.

"The other thing, they could have had a meeting to explain it," Levine said, adding, "I suppose they would have had to take some of the heat, because nobody likes to have rates raised."

A third suggestion Levine offered was for the board to discuss rate increases at its regular board meetings "so they could have gone over it with people and let them vent. I don't suspect they would have been convinced to lower the rates, but at least it would let (members) vent," he said. "If the board was a little more open and cooperative, then people would be more cooperative and understanding in return."

Candidate Pete Roberts suggested HEA could have notified co-op members in "November and probably October that this was likely to be coming."

"This was agreed to by the board, but, in fact, you know it was totally set up by the administration so there was plenty of time," Roberts said. "They had to put their facts and figures together."

HEA's 2009 Annual Membership Meeting

4:30-6:30 p.m. May 7

Homer High School

The business meeting will start at 6 p.m.

Ballots have been mailed to members and are due by 5 p.m. May 6.

Citing a jump in usage reflected on his bill -- from an average of 430-500 kilowatt hours a month to more than 700 in December -- and the switch from analog to digital meters, Roberts said, "Kilowatts are what we need to be talking about. Not different rates. Underneath this issue is that the quantities of electricity that people are being billed for radically changed all of a sudden."

Candidate Donald P. Seelinger, elected to the HEA board in 2006, was uncertain HEA could have acted differently since the small co-op purchases its power from Chugach Electric Association.

"HEA, through various media, beginning in the fall of last year, advised its consumers to anticipate a significant increase in their electric bill due to the rising costs of fuel," Seelinger said. "To this end, HEA worked with our legislative representatives to minimize the impact. We supported various ideas including the $1,200 energy assistance that was attached to all PFDs."

Seelinger proposed a program through state regulatory agencies to establish a baseline for the cost of generation based on fuel costs, with the state subsidizing the power provider for peaks and costs of fuel above the baseline.

Candidate Doug Stark, an HEA member for more than 20 years, said he was "opposed to the timing because of the lack of transparency and lack of sunshine."

Stark, along with District 2 candidate Ed Oberts, has proposed a "Utility Sunshine Bill" to the Alaska Senate and the House of Representatives.

"Its purpose is to allow more public disclosure of proposed rate hikes and is an outgrowth of the recent 40 percent rate hike by Homer Electric Association," Stark said.

Essentially, the bill would stop regulated utilities in the state from raising rates without first holding public hearings and would keep regulated utilities under the jurisdiction of the Regulatory Commission of Alaska from raising rates without prior RCA approval.

Eleven candidates are vying for three open seats on Homer Electric Association's board of directors. One position is available for each of HEA's three districts. District 1 includes Kenai, Nikiski and parts of Soldotna; district 2 includes Soldotna, Sterling and Kasilof.

Ballots have already been mailed to members, who have until May 6 to return ballots by mail or members also can vote at the annual meeting at Homer High School, 6 p.m. May 7, with registration starting at 4:30 p.m. Members can only vote for a candidate from their district.

Two bylaw propositions also are on this year's ballot. Proposition 1 would change the bylaws to allow members who are in the business of selling electrical appliances, fixtures or supplies to serve on the board. Currently, a person who sells those items cannot serve on the board of directors.

Proposition 2 would add language to the bylaws allowing board directors to be notified of a special meeting via electronic means. As it reads now, the bylaw states board members must be notified in person or by mail.

Both propositions and candidates' resumes can be viewed online at HEA's Web site, www.homerelectric.com.

McKibben Jackinsky can be reached at mckibbenjackinsky.@homernews.com.

Clarion reporter Mike Nesper contributed to this story.