||| FROM ALEX MACLEOD |||
I saw OPALCO’s notice the other day inviting candidates on San Juan and Orcas Islands to consider running for open seats on its board. To any mulling the possibility, and to those already holding seats on the cooperative, I’d like to pose a question:
Why did the cooperative pay its general manager nearly $800,000 in 2024, a figure that’s surely risen substantially last year and this?
This figure comes from OPALCO’s 2024 report to the IRS, a public document the cooperative hasn’t yet posted on itswebsite. Foster Hildreth’s total reported compensation for that year was $791,700.
Of course Hildreth has two “jobs:” overseeing OPALCO andits wholly-owned Rock Island Communications. The reportsays he devotes 85% of his time to OPALCO, the remaining15% of his 40-hour work week to RIC.
Using those percentages, his take-home pay was based on a$437,355 salary for OPALCO and $261,500 salary for RIC.Then there’s another $270,040 in undefined “othercompensation” (most often contributions to a retirementprogram.
I left a message last week with OPALCO’s finance director was explanation, but got no response. Hildreth’s total compensation for the past five years, according to the reports to the IRS, comes to a little more than
$3.275 million. This for running a cooperative with a little over 11,000 members and an internet service provider with a few thousand customers.
For comparison, the head of Chelan PUD, which operates three dams and has 51,000 customers, is paid $467,000. Seattle City Light, which operates four dams, 16 major substations and delivers electricity to over 500,000 customers spread across 131 square miles, is paid $493,770.
And the highest paid executive of the Bonnev lle Power Administration, which supplies electricity to OPALCO and 130 other Northwest utilities, is paid $450,000.
So, to the board, which approves significant rate increases without much concern, as well as to those seeking to join the board, it might be time consider if our cooperative’s general manager’s pay passes the smell test. Does what he contributes really merit nearly $800,000 for one year (by now, if the pattern holds, likely closing in on $900,000)?
The cooperative members await your answers.
Alex MacLeod is a longtime OPALCO member on Shaw.
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As President of the OPALCO Board of Directors, I want to address questions regarding the compensation of our General Manager.
The OPALCO Board is made up of local member-owners—your neighbors—who take our fiduciary responsibilities seriously. Compensation decisions are not made lightly. They result from a structured annual process that follows OPALCO’s Strategic Directives and includes formal performance evaluations, assessment of organizational results, and detailed comparisons using multiple independent compensation benchmarks from peer electric cooperatives and regional utilities.
It is also important to understand the scope and complexity of OPALCO’s operations. Our General Manager is responsible for overseeing an island-based electric system with unique reliability and emergency response challenges, major infrastructure investments, regulatory compliance, and the management of a successful broadband subsidiary. Serving geographically dispersed island communities requires experienced leadership and a high level of operational expertise.
The Board adjusts compensation only after careful review, balancing the need to retain qualified leadership with our obligation to be responsible stewards of member resources. Market-competitive compensation supports the stability, continuity, and performance our cooperative depends on.
This same approach applies across the organization. From lineworkers and engineers to IT, accounting, member services, and executive leadership, OPALCO’s wage policy is to remain competitive within the cooperative utility industry so we can attract and retain the skilled professionals required to deliver safe, reliable electric and broadband services.
OPALCO belongs to its members. We welcome questions and remain committed to transparency. The Board’s role is to act in the best long-term interests of the cooperative and the communities it serves.
Transparency.. I appreciate that. But I do question how rates have soared over the years, I would hope that the top is relative to these costs of doing business..
am I believing that balance is being exercised.. I’m not.
In other words, trust us, we are your neighbors. If the board is so proud of this, why does it never report it to the members? Anyone who has watched the OPALCO board for any time knows it is a rubber stamp. Need to do better than this, my board president.
Just for fun, I’ve checked Mr Hildreth’s compensation in past 990 filings, which were:
2015 $306,452
2016 351,775
2017 399,038
2018 455,643
2019 484,963
2020 558,058
2021 607,478
2022 632,145
2023 684,355
2024 791,700
I’m sure it’s a pleasant experience to see one’s salary increase by $50k or so per year, and I would bet that Foster’s compensation package is by far the largest in San Juan County, where the key county employees make a bit north of $100k, as do the principals and a number of teachers in our school system. The road to a high salary these days is to run a larger nonprofit or “taxing district”, with several salaries heading towards $200k (EWUA, Eastsound Sewer, Hospital District).
I’m glad that Mr. Daucinius posted a response, though it is what we might expect, and he wasn’t on the Opalco Board when most of these compensation decisions were made over the years. I’m sure there was some justification discussed in “executive session” regarding the over $100k one year raise Foster received between 2023 and 2024, but the chance that any of us “members” will become privvy to those details is, I suspect, quite small. Oh, and a former member of their board has told me that he believed that Foster was being undercompensated.
Still, as far as I can tell from a few hours research, FH is the highest paid manager of a Washington rural electric cooperative (including some with multiple times the annual revenues), and well beyond a sampling of what such managers make in the rest of the USA.
That is an ABSURD salary for any executive, let alone for a tiny co-op like OPALCO. Can anyone tell me EXACTLY what anyone can do that is worth that much money to our cooperative? Too much money going to the top is a very bad plan for everyone except Foster Hildreth.
Just checked the OPALCO IRS Form 990 for 2024, which readers can find at:
https://projects.propublica.org/nonprofits/organizations/910348358/202503209349302700/full
It says there that Foster Hildreth made $380,309 OPALCO salary plus $$141,351 from “related organizations,” presumably Rock Island, not the figures that Alex McLeon provides, but he may have better inside information than I do.
The OPALCO Board earned a total of $108,143 in 2024, including $32,217 for Board President Dauciunas, or an average of $13,518 per member.
Michael: You missed the $271,040 in “other compensation,” reported on the same line of the Form 990. My report of his total compensation for 2024 is accurate. I asked OPALCO’s CFO last week what went into that “other compensation, but never heard back. Nor has OPALCO posted the 2024 IRS report on its website, several month since it was filed. If the board wanted the membership to understand its rationale for paying the general manager nearly $3.3 million in the five years ending in 2024, it should release its salary study and recommendations to the membership. By now, though, that figure most likely has grown by another $1.7 million. It’s next board meeting might be a good opportunity.
I was not including the “other compensation,” Alex, only the “reportable compensation” on page 8 of the Form 990.
Digging a bit deeper with the help of Google Gemini, I find that Foster’s total annual salary of $521,660 is almost ten times the 2024 average annual San Juan County wages of $53,170. The median household income in the County was (or is) $83,682, while the top-earning sector is Utilities at $124,226. Looking back at the Form 990, page 8, one can discover that the Finance manager, Chief Engineer, Journeyman Lineman, two Substation Maintenance Technicians and two Foremen all made salaries over $200K in 2024. It’s little wonder that Utilities did so well.
Running an electric utility today is not what it used to be, in the days when fossil fuels were burned in generators that could, at times, loaf along, and still meet peak needs, and when environmental considerations beyond repugnant odors did not exist. Today, those who manage electric utilities are belabored with demands that the load they impulsively impose upon the utility, coupled with the cry of NIMC (Not In My County!) in response to efforts to insure that this load is met. This challenge now pervades all Northwest Utilities, and it is not surprising that Seattle has a new General Manager and CEO whose salary, on the order of $500k a year, is the highest in the municipal Seattle hierarchy. THat should give a clue to the market for desperately needed talent.
Salary does not reflect the amount of power involved, it reflects the challenges that electric utility general managers face today. Rather, the salary reflects the challenges, not the amount of power generated (or widgets manufactured).
And asking the general manager to (1) meet our power needs that we can, with our continuously on appliances, large TVs and whatever impose upon the islands electric system; (2) stipulate that not one acre of land will be applied to meeting these needs in the face of local or regional insufficiency; and (3) since our average county income (with its huge spread) is low, to be paid no more than those earning or having much less (but armed with Great Ideas) deign to allow the general manager be paid to meet these contradictory demands.
We are lucky to have Foster.
Michael, I would definitely include “other compensation” in the category “compensation” since, as Alex pointed out, this probably consists of contributions to his retirement fund, health insurance, and frankly who knows what else (does OPALCO own a private jet or plane? Tickets to the Rose Bowl?). We’ll probably never know since the organization is under no obligation to tell us how that breaks out, or for that matter, how a series of Boards decided that his compensation should increase $50k-ish a year.
You can find detailed budget and other financial information in the Opalco “documents” section, though you won’t find any specific details about the compensation of any employee. The only reason we know this information is that it is a part of the IRS 990 return, which is a public document (as a non-profit organization). Though I prefer the Propublica formatting in their 990 database, you can find copies of such returns on the IRS.gov site as well.
BTW I am not at all criticizing FH’s job performance or anything else. As far as I can see—which admittedly isn’t very far—he’s done a competent job.
Still, what do we know about the relationship of Opalco to RockIsland? For years, Opalco showed an annual loss, likely due to the infrastructure build-out phase for Rockisland’s fiber network. But maybe that’s just none of our business…?
Here’s the thing – even if I could convince the board to pay me double what my peers make, I would not feel good doing it. I would have a serious ethical problem squeezing this much money out of my neighbors I see in the grocery store line, many of whom struggle to pay their utility bills. A $400K salary in San Juan County still affords a nice lifestyle. $800K is just obscene.
The only way this gets rectified is new board members.
I may be mistaken…and if I am, I hope someone with authoritative and correct information will correct me…but past squabbles about an erstwhile candidate for the OPALCO Board who was not permitted to run as he was not perceived to be a “team player”…gave me the impression that members who wish to run for a seat on the Board must be approved by the Board or by a subcommittee of the Board before their name can be placed on the ballot.
I would think that such a requirement…if it exists…would tend to create a culture that could easily trend opposite to the best interests of a member-owned cooperative.
I think there are many pieces to this that have been a concern of mine for some years. Though this may seem unrelated, I think it’s all related and I’ll attempt to gather these thoughts and put them here. This is a placeholder so that others’ comments can continue for a bit before this comment thread closes.
Forgive the length. I’m grateful to Alex McLeod for opening up this long-due conversation and place for members to voice concerns in a public way. The big mistake from the get-go was allowing any essential utility – especially power and water – and now, communications, to be privatized and/or monopolized.
All parts relate to the whole. Here are my observations and concerns that have been building for years. The ironies stack up.
~ Base rate increases hurt the working class, low fixed income, and poor. They are as unfair as a flat tax without any recourse for those already straining to pay their electric bills on top of skyrocketing ‘market driven’ rates for food and shelter.
~ The all-electrification of Eastsound, with no backup heat for so many homes and apartments in the UGA (Urban Growth Area).
~ The glaring absence of any incentives toward conservation and low kwh usage – adding insult to injury since the board and executives seem bent on increasing base rate, not usage, nor do they incentivize low usage.
~ I read somewhere in Ruralife magazine (which I scan while holding my nose, since they are big on promoting ‘smart’ everything) that there are plans to implement peak usage kwh rate increases again. When? Where? Where does that leave people who work outside the home who might like to have a well-earned shower or hot meal before or after work, or both?
~ THE DRIVER – The fear mongering by OPALCO that we’re going to run out of power… while they and the County hurtle along aboard a runaway train of unlimited and unmanaged growth, over-tourism, and over-development and profit. Meanwhile, according to the UGA (Urban Growth Area) Growth Management Act requirements, we are 200+ affordable housing units short of where we should be! So… The County’s short and long term solution? Expand the UGA and cut down the rest of the forests and wetlands to make way for more electric, internet, and water hookups! How and why doesn’t the county have caps on kinds of growth and development projects? How is OPALCO going to be able to supply all that new electricity when it claims it can’t, and that we should prepare for longterm shortages and extended blackouts? Please enlighten us!
~ If you drive Mt Baker Rd east to Terrill Beach Rd. at night, OPALCO is the biggest light polluter on the island. I don’t CARE if they use LED. We want our night skies back. Turn off the damn broadway stage lights.
~ Stewardship of our electricity: Shouldn’t that include replanting and reparation for any damages to the lands and waters being degraded by OPALCO projects?
For low income/ working/retired/out of work folks:
~ I pay into Project Pal, as I wish all member users would if they can. (it’s a great program that costs less than $12 a year and it helps a lot of people). We could use the help.
~ I also get Energy Assist – which gives a discount on low income people’s bills – for which I’m grateful. Yet, one burning question to OPALCO: Will energy assist benefits also increase to help cover the base rate increases for those already strapped?
Another interesting observation that warrants further investigation and comparison ; perhaps an independent citizen study with some graphs and pie charts, etc (willing to get the ball rolling with others and some help sharing the workload):
~ Since OPALCO went to digital meters in 2012 and ended all meter-reader jobs (it’s now 2026) – I did a bill comparison of past years since it’s been digital. I think my bill (kwh usage) was lower than ‘last year’s bill only a handful of times in all those years. Other people I’ve spoken with have said the same; they see only increases in kwh usage, rarely the same or less kwh usage comparatively. OPALCO only keeps our usage records 10 years back but surely, the State archives must have something more. We should have access – long timers who still have copies of their old paper bills would be of help – especially before digitization of our meters.
~ Given that the former owner of Rock Island left OPALCO before his one year contract ended, and, I believe, was gag-ordered from speaking about it, how long does that gag-order last?
~ What are the checks and balances concerning accurate reading of meters? The technologies being deployed allow for all kinds of abuses in a worst-case scenario. What protections do disgruntled or merely curious members have against discrimination for speaking out?
~ Fred Klein is correct that it’s a closed loop selection committee to be considered for the board. Naming someone as ‘not a team worker’ can mean anything they decide it means, such as representing members’ concerns or asking for financials.
Thank you, Alex and others. I believe all of these points relate and are connected to the salary discrepancies and board decisions.
I can tell you what | think it is… get the comp plan changed and the go ahead for 875 acres of solar panels county wide. In spite of the fact that even that significant amount will be inadequate for increased demands as industrial scale solar underperforms in our area.
can tell you what | think it is… get the comp plan changed and the go ahead for 875 acres of solar panels county wide. In spite of the fact that even that significant amount will be inadequate for increased demands as industrial scale solar underperforms in our location.
After being contacted by OPALCO and directed to its bylaws, I’d like to amend my comment about the OPALCO election process.
There is an Elections and Governance Committee (EGC). While it is not a Board subcommittee, its nine members are appointed by the Board and serve terms of indeterminate length. The EGC is charged to create a slate of candidates for open seats on the OPALCO board. Any OPALCO members who wish to run for a seat on the board, and are not selected by the EGC, may have their names listed as candidates by filing a petition with 20 signatures of OPALCO members. Full details of the process including deadlines can be found on the OPALCO website at: https://www.opalco.com/about-community/elections-hub/why-run/
I would like to run for the open District 2 board seat.
My application and bio are ready, but I will need help gathering 20 signatures to ensure I am placed on the ballot (more like 60 to be on the safe side) by February 1st. If you reach out and gather members together, I will meet you at a public place to discuss OPALCO and myself. I want to hear more of the community’s concerns, but time is short!
My platform:
– Affordability: what cost-control measures are in place, how effectively are community dollars being invested, etc.?
– Transparency: providing “the why” and “the how” things are the way they are (not just “the what”).
– Accountability: in what ways can OPALCO better demonstrate its commitment to serving members?
Caveats: I cannot promise change, as I will be one board member among many. Furthermore, I would be unwise to show up in the boardroom with the clear intent to do battle with OPALCO’s current leadership rather than partner with them. I find it likely that the GM is being paid what the board thinks is required to retain his (assumedly much-needed) expertise. For example, if his expertise qualifies him to serve as CEO of a much larger company, it may be prudent to include those companies in his compensation benchmarks. All I can promise is that I would advocate in good faith for the three points above.
About me:
I spent every summer on Orcas between the ages of 4 and 17, my family has owned property in Deer harbor for almost 35 years, and I have been living on Orcas since September 2024. I have been an independent governance, strategy, and leadership consultant for about 15 years, and I became an OPALCO member yesterday. I graduated from UC Berkeley with dual majors in economics and psychology in 2009. I graduated from the UC Berkeley’s Haas Business School in 2023.
Pick a place and a time to meet with me before January 1st, and I will be there with petition in hand. The best way to reach me is at my email: conorsanderson@gmail.com.
-Conor Anderson
I have been in community meetings with Foster Hildreth. He bullies members when they ask questions and filibusters so that the meetings have to end because time runs out and questions remain unasked. FH talks in generalities and hides information, and his veiled threats of future blackouts are a blackmail tactic trying to scare the community. He tries to use affability to gain respect with long off-point ramblings that waste time. Many of us see through this, and OPALCO’s credibility has suffered. The Board needs to consider the CEO’s personal style, approach, values, and behavior when reviewing the CEO’s overall competence.
Reply to Jill RullkoetterCancel reply
Jill makes an excellent point. We are seeing Foster up close and in real time here on Decatur as they attempt to bully our very small Island that ALREADY HAS A SOLAR grid into tripling the amount of acres by taking out a beautiful forest. I would argue that perhaps this is some of the “operational expertise” that he is being so overcompensated for. Perhaps this is the quality of
“experienced leadership” they think a co-op needs, not listening to what we want or even what we need but getting us to find the veiled threats threats more palatable. It is time for new leadership.
In addition to his salary, I would like to raise concerns about the amount of money and natural resources that Foster Hildreth is willing to expend in pursuing solar projects. Many of us view this as a questionable use of co-op funds.
There are only two major solar installations in Western Washington – one in Marysville and one on Decatur Island – and there is a reason for this: the amount of energy produced is marginal compared to sunny climates.
OPALCO is currently seeking approval to clear-cut yet another forest on our small island to install an industrial-scale solar array that produces relatively little energy, particularly during January when our demand is highest.
I agree with previous writers that very little emphasis appears to be placed on conservation.
I support solar energy in principle, having grown up in Eastern Washington, I know that region is far better suited for large-scale solar projects.
I am a 25 yr full time resident on Decatur Island