SC co-op board resigns, won’t challenge customers’ historic vote to fire them

Tri-County Electric’s embattled board members resigned Tuesday, cementing their removal from power after the St. Matthews-based cooperative’s customers voted Saturday to throw the board out of office.

The six remaining board members also agreed not to seek re-election to Tri-County’s board or interfere with its operations.

The resignations are a key part of a settlement of a lawsuit filed against the co-op and its board by its customer-owners.

The board’s exit comes three months after The State revealed the co-op’s directors — tasked with keeping costs down for customers, who own the co-op — had hiked their own pay to more than triple the national average and given themselves co-op-funded health and life insurance plans.

It also follows a first-of-its-kind vote Saturday by Tri-County customers to throw out the board.

Tri-County’s board, which has denied any wrongdoing, had hinted it could challenge that vote’s validity in court, but Tuesday’s settlement ensures the trustees will quit without a fight.

Efforts to reach the board’s two attorneys on Tuesday and now-former board chairman Heath Hill were not immediately successful.

For years, Tri-County’s board boosted its own pay with co-op funded health and life insurance plans and by collecting $450-a-day payments for attending an inordinate number of board meetings.

Tri-County trustees earned about $52,000 a year, on average, more than any of the state’s 19 other electric co-ops.

They also claimed the $450 a day in per-diem pay for attending community events and political fundraisers, enjoyed expensive dinners, awarded themselves $300 Christmas bonuses normally reserved for employees and gave themselves co-op-funded retirement plans that paid out nearly $81,000 to each director in 2008.

One of the board’s attorneys, Lexington lawyer Jake Moore, has said the board did nothing wrong and was only acting on the advice of the co-op’s chief executive and top attorney.

However, Tri-County CEO Chad Lowder and general counsel John Felder denied that. Lowder said the board’s high pay stemmed from its own decisions, including how often to meet.

Last Friday, a judge’s last-minute temporary restraining order blocked the board from firing Lowder and canceling Saturday’s customer vote on whether to oust the board.

Tuesday’s settlement also blocks relatives of the ousted directors from running for the co-op’s board, ensuring a change in Tri-County’s leadership.

That settlement comes just a week after The State reported Tri-County’s directors had stacked its nine-member board nominating committee — which screens candidates for positions on the board — with six direct relatives of board members, including chairman Hill’s son, Billy Shannon’s wife, Doug Shuler’s cousin, Kenneth Davis’s son, Maurice Etheredge’s brother and Mary Brown’s son.

The co-op will be without a board until November, when customers elect a new one. In the interim, Tri-County will hire an outside firm to oversee the co-op’s finances, Lowder said.

This story was originally published August 21, 2018 at 2:44 PM.