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The HL&P Board Of Director’s Increase In Pay, And Your Rate Increase

Did you notice last year when the cost of your electricity went up? I know I’ve come to expect an increase in nearly every utility bill as time goes by. I don’t like it, but sometimes it is necessary to simply cover the increased cost of doing business. That was how the proposed rate increase was presented to us in July last year. The rate was described as necessary to simply cover the increasing expenses of the company, and that is why I voted for it. But how has that additional money been used? Surely the increase in your electric bill last year did something to improve the supply of energy to our community, right?

Well, not quite. About 22% of that increase was recently allocated to the board of directors in the form of full time health benefits. This expenditure was called for and approved by a handful of board members themselves. These new benefits represent an increase of more than 360% in total monthly compensation. As a member of the board I opposed this irresponsible increase in pay at the time, and I oppose it now.

Allow me to clarify that I am pleased with Heber Light & Power as a whole. The company provides our community with a resource that significantly improves our quality of life, and they do it effectively. The employees are honest, hard working people who seek nothing more than to provide the highest quality services at the lowest possible rates to their customers. I’m proud to have been able to work with them over the previous year.

While I am proud of the company as a whole, I am saddened to witness the misuse of this great organization. The good people who work there deserve better, and as customers so do you and I. During this time of economic hardship, it seems unreasonable to allow a few board members to use their position to help themselves. I respect the right of each board member to vote as their conscience dictates, and each member is entitled to their own opinion, even if I do not agree. But in this case I believe they made a poor choice.

I can hear you asking “So, why didn’t you stop this?” Good question. I’ll explain the circumstances that led to this poor decision, but first a little background might be useful here. The governing board over Heber Light & Power is composed of elected officials from Wasatch County, Midway, Charleston, and Heber City; and the chairman of the board is Mayor Dave Phillips. Each member of the board receives a monthly salary of $466 whether or not they attend board meetings, except for the chairman who receives $596.

In November last year the board voted to give themselves full-time health benefits worth a total of $1,687 per month in addition to their monthly pay. This brings the total monthly compensation of each board member up to $2,153, and after bonuses it makes their annual compensation $26,400. I’ll mention here for the sake of accountability that the board members that voted in support of this new benefit were Heber City Mayor Dave Phillips, Heber City Councilman Benny Mergist, Midway Mayor Connie Tatton, and Charleston Mayor John Whiting. The board members are supposed to represent the public and act in the best interests of the company, and their communities. Sadly, they failed in this instance.

The board voted on this issue only after I made arrangements to be absent for personal business prior to the November board meeting. I did not know that this pay increase was going to be discussed during that meeting. In-fact, out of the many meetings I attended last year I don’t recall any discussion of an additional benefits package for the board. It was believed that the rate increase we voted for in July was simply to cover the cost of business.

I learned of the board member’s decision to add the new benefits package only after Mayor Phillips briefly mentioned it during the December City Council meeting, and even then I had no idea how much the increase was. Councilman Kohler and I spoke together after we learned of the increase in compensation. We both felt it was wrong for the board to have made such an important decision without having all board members present to express their thoughts and opinions.

At the next Heber Light & Power board meeting I expressed my disapproval along with County Councilman Kohler. At the suggestion of Chairman Dave Phillips, the board decided to discuss the issue in a closed session since it involved private information regarding certain personnel. Because I am under oath not to reveal the business of closed meetings, I cannot divulge what was said during the meeting. I assure you, however, that the other board members were well aware of my opposition to the increase, and my desire to have another vote on the issue. Ultimately, Chairman Phillips decided not to bring the issue to a new vote despite our protests.

Was it legal for them to do this? Yes, but it was unethical. When rate increases are used in this way by elected officials, it amounts to a direct transfer of financial resources from the communities they represent to their own personal bank accounts. It is important to remember that as elected officials they represent their communities, and not themselves.

In addition to their responsibility to represent the welfare of their communities, the board members have a fiduciary responsibility to Heber Light & Power and it’s customers. The board should serve to provide direction and oversight to the company with the benefit of it’s customers in mind. The board should not create a burden for the company.

Unfortunately, as of this month the mayor has removed me from my position at Heber Light & Power. So, I will not be able to pursue this issue as a board member any longer. However, I continue to believe that this additional benefits package for board members is bad policy. I hope that the newly appointed board members will reconsider this decision, and restore confidence in the board of directors of Heber Light & Power.

BY ALAN MCDONALD   01/18/2012

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