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‘That’s the Deal’

SOCORRO — What members say, goes.

That’s what a New Mexico Supreme Court-appointed judge ruled this week in a landmark case in which Socorro Electric Cooperative sued all of its approximately 10,000 member-owners in an effort to block three bylaws — each aimed at increasing transparency — passed by members at last year’s annual meeting.

The ruling by Judge Albert J. Mitchell Jr. of the 10th Judicial Court District means that the Democratically controlled rural electric utility must abide by the New Mexico Open Meetings Act and Inspection of Public Reports Act.

The merits hearing drew an audience of about 100 people Wednesday, who packed a Socorro courtroom.

The co-op’s attorney, Dennis Francish, argued that the bylaws were unmanageable, created confusion and put hardship on the co-op. He said the OMA and IPRA were laws that applied to government entities and not private nonprofit corporations such as the co-op. Because of that, he said members overreached their authority when they passed the bylaws.

If put into effect, Francish said Socorro Electric would be the first co-op in the country to be subject to OMA and IPRA.

“Mr. Francish, I guess Socorro Electric will be a leading co-op once again,” Mitchell said when he announced his decision. “Owners chose to do this. If it’s to their detriment, I suspect the members will make changes.”

Mitchell ruled that the bylaws were properly and legally enacted, and there’s no law that says members can’t approve such measures. The co-op’s board might not like what members mandated them to do, but they were going to have to “live with it,” he said.

“It’s going to be a great, big change,” he said, “but members said that’s what the deal is. If members don’t like it, they can change it.”

Mitchell said the co-op should have been following the bylaws since they were adopted on April 17, 2010.

“Members put them in place and there was no injunction to suspend anything,” he said.

That means that any action taken by the co-op’s board of trustees in the last 13 months is invalid, Mitchell said.

“That’s what the (Open Meetings) Act says. You’ve got to get that cleaned up,” he said.

The bylaws in question were among a bevy of reform-related measures members adopted by overwhelming margins last year.

The movement for reform came about when it came to light that Socorro Electric’s 11-member board of trustees had incurred significantly higher expenses than other co-ops in New Mexico, peaking at $492,000 in 2009.

The co-op’s request for declaratory judgment and injunctive relief was filed against Charlene West, chairwoman of the Socorro Electric Cooperative Reform Committee, and “all unnamed member/owners” of the co-op, who are also its customers.

“It feels good to finally be vindicated,” said West after the hearing.

“It’s a win for the people. The judge said the people said this is what you’re supposed to do and they need to adhere to it.”

West credited trustee Charlie Wagner, who helped lead the reform movement, and his wife, Charlene, for their efforts to “clean up” the co-op, as well as the members who came out to vote and the attorneys who defended the case.

A status hearing on a countersuit requesting class action certification is planned for next month.