letters to the editor
Readers Lend Their Voices... continued from page 4
experience has shown some property owners block full-
easement clearance. This results in at-risk trees falling
and severing transmission lines. This causes higher
electrical costs and higher monthly bills to all co-op
members.
Power of One recommends:
• Each property owner be notified of WOEC easement
rights.
• Each property owner be notified of pending right-of-
way clearing, before it occurs.
• Each property owner be notified if proper clearance
is prevented by the property owner, the owner will be
liable for the electrical transmission costs involved
from interruptions caused by the owner’s trees.
• WOEC contract with one or more of the many logging
outfits in WOEC’s service area to handle clearing of
larger trees.
The Questions: A. What is your current policy for both
private & public lands?
B. What steps will WOEC take to accomplish the above
recommendations?
4. Tree Trimming: WOEC has three types of
easements for its power lines. Recorded easements
specifying easement width, unrecorded easements
acquired through the presence of the line for a specified
duration of time (quite common when the utility first
began providing power), and statutory rights to occupy
public right-of-way.
The specific concern expressed by the group
is the damage to utility lines caused by “at-risk trees
falling and severing transmission lines”. WOEC
implemented an enhanced (as compared to 7 years
ago) tree trimming program when we added a second
tree trimming crew in 2006. This has resulted in fewer
and shorter tree-caused outages. The issue remains that
WOEC’s easements and Oregon law restricts removal
of trees outside the easement or public right-of-way
absent the landowner’s permission.
In any event, removing all trees with the
potential for contact with a power line in West Oregon’s
heavily forested service area would be cost prohibitive.
5. SELECTION FORMAT FOR OUTSIDE
SERVICES: Competitive bidding is the norm for
outside services to cooperatives.
The Questions:
A. Were the contracted services for the new headquarters
obtained through competitive bidding?
B. What criteria were used?
C. Are competitive bidding procedures used for
accounting, legal, tree trimming, construction and
other professional services?
D. If not, what process was used and why?
5. Selection Format for Outside Services: The
following process was used for the new headquarters
construction:
A. WOEC hired a real estate consultant to assist in the
search for a suitable site, including a market analysis to
determine reasonable purchase price.
B. WOEC submitted an RFP for the construction bids
to six contractors to which three responded within the
time frame. Emphasis was put on finding the most
“local” contractor possible. The contractor chosen
worked out to not only be the lowest cost and most
local, but also a fourth of their employees are Co-op
members. The successful bidder was tasked with using
local goods, services, and hiring as much as possible.
Clatskanie PUD completed its new headquarters
building the year before construction of WOEC’s HQ.
The reported cost of the Clatskanie construction is
approximately $174 per square foot. WOEC’s new
headquarters was built for $120 per square foot.
C. Through networking with Oregon cooperatives,
WOEC has an accurate range for outside consultant
costs (e.g., auditing, legal). WOEC is considering
issuing an RFP for upcoming auditing services.
WOEC has contracted with the following
outside tree trimming companies; Trees, Inc. and
Powerliners so it can compare costs among these
providers. WOEC’s choice of tree trimming contractors
is a combination of cost comparison and the actual
amount of work the contractor is able to provide at the
stated fee.
Each project the Co-op hires out to contractors
goes through an RFP and bidding process, no matter
how large or small the project. Our contract engineering
firm reviews them as well as our attorney before the
board approves them. When the Co-op moved into our
new facilities, we also went through a bidding process
for our landscaping and cleaning services to obtain the
best price and quality of service. Preference is always
given to local contractors as long as the price, ability to
perform, and quality of service parameters are met.
6.MERGER/ACQUISITION
EXPERIENCE: In the past, WOEC has considered
changing its business plan or selling to another utility;
e.g., Tillamook Peoples Utility District.
The Questions:
A. Historically, what specific business options have
been considered and attempted?
B. What happened?
6. Merger/Acquisition Experience: West Oregon
has always been open to merger, acquisition and/or
sale. The reality is the reason West Oregon exists in
the first place is no other utility provider was willing
to serve WOEC’s service territory. WOEC has been
approached by, and engaged in discussions with,
potential buyers. However, such discussions never
advanced beyond preliminary stages after the buyer’s
initial due diligence. Any such sale would require
member approval.
In 1999, WOEC was approached by PGE
concerning WOEC’s acquisition of a portion of PGE’s
Northwest Oregon service territory. After extensive
due diligence, and negotiation of a purchase price
that made sense for the West Oregon membership as a
whole, the sale was precluded by public utility district
annexation of the offered territory.
In 2006, the General Manager approached the
CEO of PGE to inquire about the possible purchase
by WOEC of territory that would not only make the
areas the Co-op serves contiguous, but would provide
the utility with additional service area with higher
growth potential, increase our base membership, and
better diversify our base load. PGE indicated it was not
interested in selling their territory at that time.
7. CO-OP CONNECTIONS PROGRAM: A
december25
2012
7
local pharmacy will no longer accept the Connections
Card from WOEC members. The Co-op Connection
company did not disclose, in their sales information,
to that pharmacy that they would be billed $3.95 per
prescription in addition to the discount given.
The Questions:
A. Who is the parent company of the Co-op Connections
card?
B. How is the card delivered to WOEC?
C. What fees are paid by either participating businesses
or WOEC?
D. Has WOEC verified satisfaction of participating
businesses on a continuing basis.
7. Co-op Connections Program: Participating
pharmacies have signed contracts with the prescription
savings groups/claims processor “New Benefits and
Health Trans” used by many discount programs.
Touchstone/Co-op Connections just uses this network
of pharmacies that have the agreements in place,
so there is not a contract with Co-op Connections
directly. In order for a pharmacy to accept any plan,
insurance or discount, the pharmacy contracts with a
claims processor. The pharmacist must use a processor
to determine the amount a consumer or insurance
company will need to pay. The discounted price with the
Co-op Connections® card is around the same amount
as what the pharmacist gets paid as a reimbursement
from an insurance carrier. There is no reimbursement
to the pharmacy with the discount card because they
are getting paid the agreed upon rate by the member at
the point of service. Since there is no insurance claim
involved in the discount process the processing fee is
collected by the pharmacist directly from the member.
The member pays the amount that includes the cost
of the drug and the dispensing/processing fee. The
processing fee is used to cover the administration costs
of the processor and resellers.
These agreements were signed long before
WOEC even knew about the Co-op Connections
program. These pharmacies are a part of the discount
networks whether we have the Co-op connections
program or not. There are many pharmacies including
Fred Meyers, Rite Aid, Walgreens, Target, etc. that
honor the prescription discounts with the New Benefits
and Health Trans networks that the Co-op Connections
program use.
A. The Parent company of the Co-op Connections
program/card is Touchstone Energy which is a
nationwide alliance of 740 member owned electric
cooperatives. Touchstone is a brand identity and
provides co-ops access to programs and materials that
we would not be able to afford on our own.
B. The Co-op Connections cards are printed by a
Touchstone vendor and made available to Touchstone
cooperatives at low rates due to volume printing.
WOEC distributes the card to our members in the
annual meeting mailing so no additional postage was
required to distribute the cards. There has only been
the original distribution and then the updated card was
sent out this year due to additional programs being
added to the benefits of the card.
C. The businesses (other than the pharmacy agreements
continued on page 18
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