RED LODGE — During a special board meeting Wednesday afternoon in Red Lodge, trustees of the Beartooth Electric Cooperative put the brakes on the co-op’s support for Phase II of the Highwood Generating Station in Great Falls.
Less than three weeks after the co-op’s membership elected three new trustees to the seven-member board, Beartooth’s board passed several resolutions restricting the co-op’s role in its relationship with Southern Montana Electric Generation and Transmission.
The Billings-based Southern is the umbrella co-op that provides power to Beartooth, four other co-ops and the city of Great Falls. Southern is also the entity building the Highwood facility near Great Falls. Phase I of the gas-fired plant came online in September and a majority of Southern’s members recently authorized their parent co-op to borrow an additional $300 million to build Phase II.
In reversing a decision made earlier this summer, the new board passed a resolution directing Beartooth to undertake a due diligence analysis that would assess the financial impact and risk for Beartooth if Southern proceeds with the next phase of Highwood.
The resolution also mandated a similar analysis of the risk and financial impact to Beartooth of Southern’s current financial condition. As of June 30 of this year, Southern’s operating deficit had risen to $7.2 million. More recent updates were discussed in closed session.
In another action, the Beartooth board instructed its representative on the Southern board to vote against spending or committing any funds to Phase II until the due diligence analysis had been completed.
“With this, we’re sending a message to Southern,” said new trustee Dan Dutton, who authored the resolutions.
The board also voted to restrict its representative on the Southern board from making any decisions that could have a “significant potential financial impact” on Beartooth without first getting approval from a vote of the Beartooth board.
In ruling on the member-driven petition effort to recall Beartooth board members John Prinkki and Joe Kern, trustees approved the hiring of an attorney to advise them in the recall process, while simultaneously lining up a third party to verify signatures on the petition.
During a comment period, Beartooth member Gary Buchanan cautioned the board that removing a trustee for “just cause” is ambiguous and dangerous.
“If just cause is a difference of opinion from what was a majority and now is a minority, that can be done by an election,” he said. “I supported some big changes and I did it via the election process.”
Member Bruce Austin used his turn to offer a different take on Beartooth’s relationship with Southern.
“Basically, they need you a lot more than you need them,” he said.
In an effort to open board meetings to more co-op members — until Wednesday’s meeting, attendance had been limited to five members — a committee is researching other, larger venues. The board also reversed a decision made earlier this summer when it voted Wednesday to record meetings.