— by Alex MacLeod —

The resignation of Mike Greene from OPALCO’S Rock Island Internet business should be a wake-up call for OPALCO’s membership and its board of directors.

Greene was the founder and architect of the pre-OPALCO version of Rock Island, an outfit that enjoyed an excellent reputation for high-quality customer service despite the limits of a DSL infrastructure. It was that good will and online business expertise that OPALCO bought when it decided on its go-it-alone Internet expansion.

OPALCO wisely kept Greene on as vice-president of technology after the purchase. His understanding of the business, from the ground up, was far greater than anyone’s at OPALCO, invaluable expertise for a business which before the purchase was simply a local electric monopoly.

So why did Greene suddenly walk away from a big paycheck while OPALCO’s Rock Island clearly continues to struggle to meet its most basic business goals?

He refuses to discuss the subject, citing fears that OPALCO would sue him for saying anything negative or violating a confidentiality and non-disparagement agreement signed when he was hired by OPALCO. He’s not a rich guy, he doesn’t have a job and he says the last thing he could afford are legal bills.

His is not a novel position. It is the same one former board member John Bogert faced when he resigned from the OPALCO board after it decided to pursue what he believed was an unnecessarily high-risk financial move into the Internet business on its own, rather than leasing its infrastructure to experienced Internet providers whose lease payments would cover all OPALCO’s costs of expanding its broadband and wi-fi infrastructure (which OPALCO insists on calling its electric-grid backbone).

Even current board members are “required to publicly support decisions of the board except in extraordinary circumstances where the director can demonstrate (italics added) that a decision or action will bring harm to the cooperative or threaten the cooperative’s survival” (Board Policy #1).How a director could demonstrate that, or, more centrally, to whom, is unanswered and creates pretty much an absolute gag on expressing any public disagreement.

That leaves us co-op members with little more than OPALCO’s public-relations operation. In this case, we’re told Rock Island is moving forward so smoothly that it no longer needs Greene’s expertise, so “Greene has taken the opportunity to step down,” it says.

Anyone closely following Rock Island’s “progress” — a group that doesn’t seem to include OPALCO’s board — knows that it is pretty much on the rocks. It keeps insisting it will reach minimal goals by the end of the year despite plenty of evidence that it won’t. It has promised its lender the business will start throwing off excess cash by 2017 to help fulfill OPALCO’s loan terms, though there is little hard evidence that will ever happen, much less in two years.

At the root of OPALCO’s problems is just plain bad management. The board named Foster Hildreth, who had been No. 2 at OPALCO, as general manager when Randy Cornelius retired after 13 years of steady leadership. It did no search and considered no one else, even though some board members privately expressed doubts about his capacity.

So what has Hildreth accomplished?

Most significantly, in the very first year of his leadership OPALCO violated one of the core terms of its loan agreements with it low-interest federal lender. In the normal world of business, this just isn’t done; when it is, heads roll. OPALCO management’s response has been to insist that, technically, it isn’t in violation of the loan agreements even though it was required by the lender to submit a “corrective action plan” to ensure that it won’t violate them again.

The next comeuppance came in July, when the board had no choice but to impose a 10% emergency rate increase on top of a 12% increase imposed just four months earlier. This is good management?

Along the way, OPALCO has invested millions of dollars in its nascent Internet business, with little to show for it. Adding salt to that wound, all co-op members are having to pay those bills even though only a small percentage of members want or, more significantly, can afford it. Now Greene is gone, along with some others, and morale there, as well as in the ranks at OPALCO, reportedly has turned sour.

Meanwhile, the board insists all is well. Hildreth is doing a fine job, Rock Island is about to become a profit center, electric rates have been too low so it’s only right they skyrocket a minimum of 180% from 2014 through 2019, and anyone who thinks otherwise, regardless of their facts, shouldn’t be listened to. (The board actually ends its recent “thoughtful” essay on rates and finance https://www.opalco.com/news_article/board-perspective-on-rates-and-finance/
with the admonition that while “Social media helps to broaden participation in the conversation, (it) should not be mistaken for the conversation itself.”)

The bottom line seems to be this: No one associated with OPALCO can or will talk honestly about what is going on, and none of us who actually may know what is going on should be listened to. In other words, we all need to be quiet. We might wake the board.

(Alex MacLeod is a 30-plus year OPALCO member who lives on Shaw Island. The OPALCO board’s next meeting starts at 8:15 a.m. Thursday at Woodmen Hall on Lopez.)

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