Members Gather For First Annual Meeting in 3 Years

When the COVID-19 pandemic took hold in the U.S. in March 2020, public gatherings across the country were abruptly canceled—and Deaf Smith Electric Cooperative’s annual meeting was no exception.

Tim Burkhalter had just taken the helm as the co-op’s president and general manager, and the annual meeting cancellation was just the beginning of a two-year span marked by unexpected developments and unprecedented challenges that included not only the coronavirus pandemic but also a devastating winter storm, a war in Ukraine with major ramifications for natural gas prices, and generational shifts in Deaf Smith EC’s workforce. “It’s been a downhill slide in the economy with the pandemic and all these other things,” Burkhalter said at the co-op’s annual meeting March 22, its first since 2019. “It’s been a constant state of change. And so it’s kept me on my toes. It’s kept our employees on their toes in order to make sure we continue to do what we set out to do—and that’s to serve you guys with your power needs at the best, safest, most affordable levels we can.”

That adaptability and resiliency to ultimately fulfill the cooperative’s mission was the major theme at this year’s annual meeting, which welcomed nearly 800 people to the Bull Barn in Hereford for a meal catered by Danny’s Fins and Hens and to hear about the business of the cooperative. One obvious change to the meeting was the lack of in-person voting for directors. Instead, members voted by mail before the meeting, reelecting Michael Carlson and Vick Christian to three-year terms on the board of directors. New to the board is Robert Boozer, who replaced Donald Wright after his retirement in 2021. Sadly, Wright died in November. 

In his opening remarks, Jim Hoelting, board chairman, recognized the co-op’s employees for their dedication to their work and three linemen in particular—Nathon DeLeon, Fabian Diaz and Joseph Murray—for completing Deaf Smith EC’s 8,000-hour apprenticeship program. “We have a great group of employees,” Hoelting said. “We know that they feel their sense of purpose, they feel pride in their work, and I think they have a knowledge of how much they are appreciated.” That sense of purpose has been evident over the past two years. As 11 co-op veterans representing nearly 400 years of experience have retired from Deaf Smith EC, 14 new faces have stepped in to replace them. 

First among those issues was the pandemic. To address safety concerns, the co-op installed safety barriers in its lobby and an outdoor drive-thru pneumatic tube system that continues to see daily use. Pandemic-related supply chain issues continue to affect the co-op, Burkhalter said, which has meant shortages and long lead times on everything from replacement transformers to bucket trucks. “We really have to plan out ahead and try to make sure that we continue to keep those in an inventory status that makes sure we can get to you guys when you want to build a new job or add a new line or change your well,” he said. 

Among the most significant events affecting the co-op over the past two years was the February 2021 winter storm, which plunged the entire state into subfreezing temperatures and sent energy prices skyrocketing. Despite selling a typical level of kilowatt-hours in February—about 42 million—Deaf Smith EC was hit with an extremely steep bill at the end of the month: nearly $21 million in fuel costs alone. “That number right there represents about 55% of our entire annual budget for purchased power—not just fuel but all the power we buy,” Burkhalter said. “This was just the fuel. So that hurt.” In response, the Deaf Smith EC board deliberated long and hard about how to recuperate those costs as painlessly as possible to the membership and decided the co-op should take on the debt itself. Rather than charging members a one-time fee—which could have been as high as $7,900 per customer or $1,412 per meter—the co-op will spread the cost over time, adding two-tenths of a cent to every kilowatt-hour it sells for the next 10 years. “That makes it a lot more manageable,” Burkhalter said. “Does it make it more fair? No, I don’t think it does. It just spreads it out and makes it hurt less.”

Fortunately, the co-op’s debt was cut nearly in half by funds it would have received as capital credits from Golden Spread Electric Cooperative, the generation and transmission provider that Deaf Smith EC owns with 15 other electric cooperatives. 

Despite these recent struggles, Deaf Smith EC remains strong, Burkhalter said. For one, the co-op sold more kilowatt-hours in 2021 than it ever had previously—about 813 million kWh. And despite the high bill from the winter storm, the cooperative’s financial condition is good, said Charlie Gorman, auditor at Bolinger, Segars, Gilbert & Moss, who presented highlights from the co-op’s financial report.

The smiles, chatter and laughter in the Bull Barn were evidence that attendees were happy to come together in person to revive the tradition of the annual meeting, a gathering both enjoyable and essential to the functioning of the cooperative. “It’s really great to be able to get together and do this kind of stuff again,” Burkhalter said. “I think we feel it as a little bit of a return to normal. In some new sense or in some old sense, this feels like the same sort of an annual meeting that we’ve always had: We get together, enjoy some food, enjoy some fellowship, enjoy each other’s company and hear a little bit about what’s going on.”

Story by Travis Hill, Texas Electric Cooperatives