Grassroots support is key to a strong co-op

Chapter 10

Grassroots support is key to a strong co-op The annual meeting has always been the premiere event for the cooperative to gather its grassroots supporters together. W said former Verendrye board member Hilton Sollid. hen H.H. Blackstead and other That same grassroots support Verendrye Electric founders went door-to-door asking people to help start a cooperative, they relied on for its birth has been vital throughout were asking for more than a $5 membership fee; its history as the cooperative has faced numerous they were asking for grassroots support. Supporting political battles ranging from local territorial issues the cooperative was done out of necessity because no to attacks in Washington on the REA program itself. one else, including investor-owned utilities, would The cooperative family is strong and it percolates up from the bottom, said retired bring electricity to rural areas. Verendrye employee Bob Horne, who managed We d get together, and organize and put together something to help ourselves, and that s the VEC s Minot office for 20 years and also served in basic thing, of course, for the co-ops: If they aren t the North Dakota Legislature. going to do it for you, you have to do this yourself, Celebrating 75 Years of Verendrye Electric Cooperative 98

This 1960s-era advertisement that appeared in the ND REC/RTC Magazine illustrates how bringing electricity to rural areas was considered a moral obligation by cooperative leaders. Because cooperatives focused on improving people s lives, rather than making profits, rural electrification became a strong grassroots movement backed by millions of people throughout the U.S. 99 Building a dream together

Verendrye members visit the Action Committee for Rural Electrification (ACRE) booth at an annual meeting. ACRE is a bipartisan, grassroots political action committee that supports candidates who support policies favorable to electric cooperatives. In 2005, Verendrye Electric won the Walking the Wood award from the National Rural Electric Cooperative Association (NRECA) for being the top performing cooperative in ACRE involvement. In 2013, Verendrye Electric Manager Bruce Carlson won the William F. Matson Democracy award for outstanding accomplishments and service to rural electric cooperatives through political action, political education and member participation. RURAL ELECTRIFICATION AS A SOCIAL MOVEMENT Rural electrification was a social movement aimed at bringing equality to rural residents who did not have the same quality of life as city residents. Depression-era policies like the Rural Electrification Act of 1936 helped cooperatives get their footing with low-interest loans and technical assistance, but a grassroots movement to improve the conditions of rural people started decades before that. Before the REA, only about 10 percent of farms were electrified. Today, almost all rural areas have access to electricity. President Theodore Roosevelt took some of the first crucial steps toward a plan to light up the countryside. Roosevelt appointed the Country Life Commission to publish a report on how the lack of services in rural areas created disparities between city and rural residents. The report suggested the use of federal hydropower and the organization Celebrating 75 Years of Verendrye Electric Cooperative 100

A large group of Verendrye s grassroots supporters attend a meeting with area legislators in 2012. The cooperative relied on a grassroots movement to start the cooperative, and relies on supporters today for political support. of cooperatives to help electrify rural areas. He was also a strong advocate of preference power, which requires federal power marketing agencies (PMAs) to give preference to electric cooperatives and municipal utilities to purchase low cost hydropower. 1 Verendrye receives preference power generated from the Garrison Dam that s marketed by the Western Area Power Administration (WAPA). COOPERATIVES FORM THE NRECA Once cooperatives began to grow strong, they formed a unified grassroots network starting with state organizations and later a national organization. The National Rural Electric Cooperative Association (NRECA) was established in 1942, initially for the purpose of getting restrictions on supplies lifted when they became scarce during World War II. The organization grew into a strong lobbying arm of cooperatives in Washington, D.C., and 1 Richard A. Pence, ed., The Next Greatest Thing: 50 Years of Rural Electrification in America, Washington, D.C.: National Rural Electric Cooperative Association, October 1984, 39-41. today represents more than 900 cooperatives. The NRECA has been called upon countless times to defend against attacks on federal programs that help cooperatives. One of the most memorable attacks on cooperatives is known as Black Friday by cooperative leaders. On Dec. 29, 1972, President Richard Nixon s administration ended the REA s low-interest loan program in favor of higher interest loans from the Rural Development Act, and refused to spend authorized funds for other rural programs. REA supporters flooded Washington, D.C., and by May 1973, the program was restored. 2 I can remember the groundswell and we went to Washington and had massive rallies and not just North Dakota, but all over the nation, to show the political muscle and the Congress had to overturn these types of things, said Gary Williamson, a former VEC employee and legislator before serving as manager of Central Power Electric Cooperative for many years. 2 Ibid, 197. 101 Building a dream together

1,400 rural electric leaders gathered in Washington, D.C. s Mayflower Hotel on January 23, 1973, to protest the Nixon Administration s move to terminate the REA loan program on December 29, 1972. Congress restored the program on May 11, 1973. Photo courtesy of the National Rural Electric Cooperative Association (NRECA). Celebrating 75 Years of Verendrye Electric Cooperative 102

Cliff Gjellstad, a Verendrye director from 1985 to 2012, speaks at the dedication of Prairie Winds ND 1 in 2010. Cliff is a past chairman of Basin Electric Power Co-op. Verendrye is one of 137 cooperatives that own Basin. The directors that lead Basin come from the distribution cooperatives that own it. Member control from the meter to the power plant When Verendrye Electric was established, the cooperative didn t own its own power plants, and had to rely on purchasing power from investorowned utilities. Now cooperatives control their own destiny by owning and operating power plants with a leadership structure that begins with the members. Today, electric cooperatives sell approximately 50 percent of the electricity in North Dakota with $1 billion of investments into distribution facilities and $5 billion of investments into generation and transmission infrastructure. Managing the cooperative-owned generation and high-voltage transmission 103 Building a dream together

system is a democratic process that starts with the individual member-owners at each of the distribution cooperatives. Verendrye and five other distribution cooperatives have an ownership stake in Central Power Electric Cooperative, a transmission cooperative, and 137 cooperatives own Basin Electric Power Cooperative, a generation and transmission cooperative. Verendrye s board of directors elect a representative to serve on the Central Power board. The Central Power board then elects a representative to serve on the Basin Electric board. The process is repeated in each of Basin s 11 districts which are spread out over nine states serving 2.8 million members. An example of how control starts at the meter and continues to the power plant is former Verendrye board member Cliff Gjellstad. Cliff was elected to the Basin Electric board in 2000 and became chairman in 2010 before retiring from cooperative leadership in 2012. Gjellstad was born and raised on a farm near where Verendrye Electric started. Cliff s time as chairman of Basin Electric was a great example of how cooperatives use the democratic process to control the cooperative from the bottom up, said Verendrye Manager Bruce Carlson. ALL POLITICS ARE LOCAL The NRECA provides cooperatives a say in federal issues, but some of Verendrye s most important issues have been decided on the state and local levels. Before the NRECA was created, cooperatives in a number of states had created statewide organizations to lobby on a statewide level. North Dakota cooperatives formed the North Dakota Association of Rural Electric Cooperatives (NDAREC) in 1958. One of the most prickly problems cooperatives faced was protecting their customer base from being swallowed up by nearby investor-owned utility companies. Once cooperatives became more established and cities began to grow, investor-owned utilities would build services into co-op territory to serve lucrative new areas of growth. Cooperatives were successful, with the help of a unified voice through the NDAREC, in passing the landmark Territorial Integrity Act (TIA) of 1965. The TIA was passed to protect territory of cooperatives and prevent wasteful duplication of services. Williamson, who voted for the TIA as a legislator, remembers Verendrye racing against Northern States Power Co. (now Xcel Energy), to extend lines into areas that were thought to be potential growth areas. Verendrye was very aggressive in attempting to put lines where they thought the development would come, Williamson said. People thought I was kind of nuts, but I d sign-up billboards and we d string wire to billboards and put mercury vapor lights on them to get into the territory. Both Williamson and Horne describe the passage of the TIA as a major accomplishment for cooperatives. The greatest event in North Dakota was probably the Territorial Integrity Law of 1965, Horne said. It had a great affect on Verendrye because that allowed the city council of Minot to Celebrating 75 Years of Verendrye Electric Cooperative 104

DOBRINSKI IS A GRASSROOTS LEADER A great example of leadership starting at the grassroots level is Everett Dobrinski, a past Verendrye chairman, who is Chairman of CoBank. CoBank, a cooperative bank based in Denver, provides loans and other financial services to rural electric cooperatives, agribusiness, rural water systems and communications providers in all 50 states. CoBank has 24 directors elected from six regions of the country. It is Verendyre Electric s secondary lender. Everett began serving on the CoBank board in 1999 and was elected chairman in 2008. He served on the Verendrye Electric board from 1985 to 2012, having served as chairman for many years. He is the owner and operator of Dobrinski Farm, a cereal grain and oilseed farm in Makoti. Tom Mund, a former director at Dakota Valley Electric Cooperative, testifies in 2005 in the State Capitol in Bismarck against legislation to limit where cooperatives can serve new members. Cooperatives have defeated several proposals to limit where they can serve thanks to a strong network of grassroots supporters. Photo courtesy of the North Dakota Association of Rural Electric Cooperatives (NDAREC). enter into an agreement with NSP (Xcel Energy) and Verendrye to draw that territorial line around Minot, which gave us the wherewithal to build our base on the outside of Minot. The TIA stopped many territorial battles, but not all of them. Years after the TIA was passed, Chester Reiten, longtime Minot mayor and Republican legislator, brought Verendrye Electric and NSP to the table to help resolve territorial disputes. Chet got tired of the continual lawsuits that he thought slowed growth in the area, so he called the NSP head in Minneapolis and us, and we sat down and worked it out, said former VEC Manager Wally Beyer. The City of Minot approved a 20-year franchise for both utilities in 1992 without any opposition from either utility or the public. The franchise was renewed again in 2012 without opposition. Verendrye s first franchise with Minot dates back to 1973. Verendrye also has franchises to serve areas of Velva, Surrey, Burlington, Berthold and Harvey. The TIA has been challenged on many occasions through the years, but cooperatives have been successful in fighting back the challenges thanks in part to their strong grassroots support. One example is the 1999 legislative session when IOUs introduced Senate Bill 2389 that was aimed to gut the TIA. Hundreds of cooperative supporters throughout the state crowded committee hearings and wrote letters against the bill before it was soundly defeated. There ve always been challenges to it and so far the co-ops have prevailed, in my opinion, because they stay active politically, Williamson said. (Cleo Cantlon contributed to this chapter) 105 Building a dream together

How can you become involved in your cooperative? Verendrye Electric encourages its members to become more involved in their cooperative, and there are several levels of involvement ranging from attending informational meetings to becoming a director. If you have questions about how to become more involved, contact an employee or director of Verendrye. ANNUAL MEETING The easiest way for members to be involved in their cooperative is to attend their annual meeting each year, which is held the second Thursday in June. The annual meeting is important because members can vote for the candidates they want to represent them on the board, and also vote on proposed resolutions. The annual meeting is also a good time to learn about the cooperative and voice your concerns with directors and employees. CAUCUS MEETINGS For those who want to become more involved by running for a position on the board, the caucus meetings are the place to start. Each April, Verendrye holds one caucus meeting in each of its three districts where you can nominate someone to run for the board, or be nominated to run for the board. These meetings also give members a chance to hear presentations about how the cooperative is doing. MEMBER ADVISORY COMMITTEE You can become the co-op s eyes and ears by joining the Member Advisory Committee. To become a member of the committee, you must be nominated by a director. There are normally around 60 members of the committee. There are one or two meetings of the Member Advisory Committee each year. The meetings allow members to discuss policies, cooperative programs and energy-related topics with staff and directors. Members also get newsletters, and some help assist with the annual meeting. Many of Verendrye s board of directors first served on the committee. ACRE Members can help their cooperative in the political arena by becoming members of the Action Committee for Rural Electrification (ACRE). Membership levels begin at $25 and the funds go toward supporting political candidates who support policies favorable to cooperatives. ACRE members are invited to a complimentary dinner every other year where they can meet candidates for the Legislature and city and county offices. There is also a special ACRE reception at each annual meeting with a special presentation on national, state and local issues affecting cooperatives. Celebrating 75 Years of Verendrye Electric Cooperative 106

Chapter 11