Congressman Jim Cooper (D-Nashville) has a major committee hearing tomorrow regarding how electric co-operatives do business. While the crux of the meeting will concern a co-op in Texas, the findings from the hearings could radically affect how Tennessee electric co-ops do business.
Electric co-ops are owned by their customers and have a mission to provide access to electricity at affordable prices for every potential member in their service area, no matter how remote. In our region, the Tennessee Valley Authority is a major distributor of power to co-ops. In fact, every county that touches Metro Nashville – with the exception of Cheatham County – gets its power from a co-op.
The problem, according to Cooper and other elected officials, is that many co-ops have kept their prices at artificially high levels without paying dividends to the consumers who are also owners of the co-op. While Tennessee's co-ops are not the focus of any of the discussions taking place in Washington, the goal of the hearings is to encourage all co-ops to become more transparent with their member owners.
Cooper is no stranger to co-ops. His father, the late Gov. Prentice Cooper, founded one in rural Middle Tennessee in the middle of the last century. In response to the issues now facing the sector, Cooper has penned a policy essay titled "Electric Co-Operatives: From New Deal to Bad Deal?" It has been published in the Harvard Journal of Legislation.
At issue at tomorrow's hearing is a Texas co-op accused of gross financial mismanagement. The Pedernales Electric Cooperative of Texas – which was founded by President Lyndon B. Johnson – has since become the focus of an investigation by the Texas Attorney General and a fight led by Republican State Senator Troy Fraser.
Among the issues involved are massive compensation packages for former directors of the co-op, trips to Las Vegas and the purchase of vacation homes. Two of the co-op's former directors have been issued subpoenas to testify in Washington tomorrow, but media reports in Texas say the pair has yet to be served with papers by U.S. Marshals.
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