Our  Grievances

Against the Board of Directors of Hilco Electric Cooperative, Inc.

It just keeps on coming:

• Two members visited HILCO Offices in Itasca for the express purpose of reviewing financial and governance records of the Cooperative.  The Acting CEO was directed to not provide current financial documents (Form 7 and balance sheets showing expenses vs. revenues) pertaining to the operation of the businesses (electric/propane/water/land development).  To re-state the situation:  a member of the Cooperative asked, in advance, to see the current financial operations of the Co-op and was denied that right.
   

• The Co-op did provide a copy of the February Minutes which were not very useful in describing activities/discussions pertaining to Board actions because of a notable lack of detail.
   

• In addition, the Co-op provided some financial records pertaining Board fees/reimbursements paid through the end of March 2007 and some additional invoices paid during the first few days of April.  The results of our review of those documents/invoices are as follows:
   

  • Bill Allen (District 5) has charged HILCO almost $15,000 through the end of March, including a partial claim for April for a trip to Last Vegas ($3,500+).  It appears he may charge an additional $2,000+ by the end of April for an approximate total of $17,000 for the first quarter.  Annualized, his fees/reimbursements would show a possible expenditure of $68,000 for the 2007 total.  His budget is $38,000.
     

  • George Thiess (District 6) has charged approximately $13,500 for a potential annualized amount of approximately $75,000.  His annual budget is $38,000.
     

  • Margaret Hill (District 2) has charged approximately $11,000 for a possible annualized amount of $44,000.  Her annual budget is $38,000.  In addition, Ms. Hill charged travel expenses for a trip to Las Vegas to HILCO and then failed to attend.  HILCO will see some use out of the airfare, but will lose the re-schedule fee because she failed to attend.
     

  • Dave Smith (District 7) has charged $5,600 for a potential annualized amount of $22,000+.  His annual budget is $38,000.
     

  • Kyle Cross (District 1) has charged $3,700+ for a possible annualized amount of $15,000.  His annual budget is $38,000.
     

  • KW McPherson has charged $3,600+ for a possible annualized amount of $15,000.  His annual budget is $38,000.
     

  • Steve Sawyer (District 4) has charged $3,600+ for a possible annualized amount of $15,000.  His annual budget is $38,000.
     

• One interesting change to the travel invoice procedures appears to be the removal of the CEO in the "review process."  At this time, it appears the only employee involved in the invoice payment is the Chief Financial officer, who is a CPA, but the CEO is being kept out of the information flow.  This is an open invitation to issues of fraud, waste and abuse.
   

• There was an interesting accounting maneuver that shows "credits" to various director financial records making it "appear" they are being paid less that is actually being paid.  This act does not appear to be fraudulent, but it can be used to make statements pertaining to expenses vs. budgets because of the accounting method.  The old adage "Liars often figure and figures often lie" comes to mind.

Rescue HILCO -- Take our Co-op Back!