DMEA's board of directors is responsible for hiring only one employee — the general manager. The entire board meets yearly to review the GM's performance, determine compensation, and define goals and objectives.
The GM is given the authority and responsibility to hire all other employees to achieve the performance standards as set by the board. Several years ago the board directed the GM to designate an assistant GM. The association has two types of employees — non-bargaining and the bargaining unit that is represented by the International Brotherhood of Electrical Workers. Union employees are covered by a contract and wages and benefits are negotiated periodically based upon the financial ability of the cooperative and the compensation package necessary to attract and retain qualified employees. Employee compensation has a minor impact on rates, as wholesale power costs, good management, and resultant efficiency play a much greater role. The goal is to pay enough but not more than necessary. For example, DMEA would not be able to maintain its great reliability and quality infrastructure if it didn't provide competitive journeyman lineman compensation, union or not.
Management salaries are set by utilizing data from cooperatives in a multi-state region, Colorado cooperatives, and Western Slope data for similar positions. Investor-owned utilities such as Excel are not used as that industry pays substantially higher wages and is not the same as a cooperative, primarily because of their for-profit status which would also allow stock options to be a part of compensation. The board's most recent management compensation plan including salary ranges for each position was adopted in 2003 and presented yearly for review and board approval. A certified compensation professional verified the appropriateness of the methodology. In 2012 the board rescinded the plan and did not adopt the new one based on the professional's recommendations as proposed by staff. Recently several key employees left to work for other companies, costing the cooperative a substantial loss due to recruitment costs and training expenses.
In 2009 the IRS required non-profits to report salaries and benefits of the top employees and the directors yearly. The board is required to approve this form. Total compensation is misleading because the pension contribution is based on maintaining an annuity in the future and is greatly affected by the performance of the stock market. This is not money that the employee directly receives and should drop substantially in 2014, as the market has recovered. Full retirement is age 65. Since 2012 both pension benefits and medical insurance benefits have been cut for all employees. Retired employees do not receive medical insurance nor do current directors. I'm sure the operational and board audit will bear out that total compensation and organizational structure is competitive and necessary but that stable governance is missing. For level-headed leadership please vote for Olen Lund, Erica Lewis-Kennedy and Tony Prendergast.