Board News | Winter Quarterly 2019
Third Quarter Board Meeting Recaps
October, November, and December board meetings
The last three months of 2018 have been filled with Co-op board meetings and member participation.
In October the board held its first meeting in the Eureka store in years. There were over 50 members present, many of them employees, speaking to the recent layoffs instituted by management, and a general lack of clarity regarding the financial situation of the Co-op. Considering that there were decreases to hours and percentage cuts across the organization, the Board of Directors elected to take a 25% cut to their monthly stipends. Also discussed was a new communication policy with the board – emails sent to Board@northcoast.coop are now automatically sent to every board member, at the same time. Management is not privy to information unless the board deems it necessary, and responses should be sent by the board president.
November saw four board meetings, one regular meeting at the beginning of the month, several special board meetings, and a Finance Committee meeting. A common thread through these months is that member participation at meetings has been higher than we’ve seen in prior months, even years, and shows how engaged our members are in their Co-op. Some came after attending the Annual Membership Meeting, others after they read the articles posted by local media outlets, and familiar regulars were present as well.
What was apparent to me in the comments and discussion of the board is the need to affirm our commitment to transparency, and to rebuild trust between the board, employees, and members. While this is an ongoing conversation there has been action. Quarterly financials will be posted on the website next to Finance Committee agendas and minutes. There is a new policy for chairs of board committees to write a summary of each meeting to be emailed to employees, posted in stores and online. Discussion of best communication practices will be continued at the January and February board meetings.
Annual Membership Meeting
The Annual Membership Meeting was held October 21 – celebrating 45 years! Member turnout was very high, with the Arcata Veterans Hall nearly filled to capacity. The Annual Membership Meeting is a time for the board to hear from the membership, and with so many in attendance, to hear voices across the entire member base. Chief among the requests from members was more transparency, clarity about the Co-op’s financial situation, and better sharing of knowledge. Members were, and still are, worried about the financial viability of the Co-op, with many offering impassioned pleas to keep this community centerpiece healthy and vibrant.
Strategic Plan Adopted
At the Annual Membership Meeting members adopted the next five-year strategic plan – set to take effect fiscal year 2020 to 2024. You can read more about it on the Board page on the Co-op’s website. The strategic planning process for the next five years was member lead, and member adopted. It covers a broad range of topics; from our Co-op as a community hub to strengthening our position as the most welcoming, accessible, and affordable place to buy healthy, quality, organic, and local food. The strategic plan incorporates racial and social equity to diversify the makeup of our leadership positions and ensure we confront inequity and inequality in our operations and in our community. Historically, we’ve been a leader in environmental responsibility, and will continue to improve our environmental practices focusing on reducing waste, energy consumption and greenhouse gas emissions while engaging consumers and vendors in low-impact shopping. Included in the strategy is developing our local cooperative economy to foster and develop new cooperative ventures with active community leadership and education regarding the cooperative movement. Members continue to push the Co-op to support our robust local food system to increase autonomy over the production and distribution of food supplies. And we should always plan for financial viability, to invest in staff, operations, renovation and expansion activities that increase profitability and allow us to fulfill our vision, mission, values and strategic plan.
Co-op Finances
In early November I was informed that the Co-op was facing a cash liquidity crisis – or in simpler terms – there was a chance the Co-op could run out of cash. I shared this information with the rest of the board, namely that a cash forecasting tool provided a forecasted date of December 7 to run out of cash, and that we needed to take immediate action. Thankfully, we can look back on this information with hindsight, and take a deep breath. Over the next two weeks the board and staff worked to provide clarity regarding the situation, and to gather member input. The first meeting was well attended, and the tone was incredibly cooperative. Members and staff shared dozens of ideas, both short and long-term, that we could assess and potentially put into action. The meeting opened with General Manager Melanie Bettenhausen giving background on the current financial crisis and how we came to be in this position. She also updated the board and members on actions taken by the management team and staff since the November 1 Board Meeting. These included finding an additional $50,000 in cuts to the Co-op’s fiscal year budget, seeking opportunities to extend terms with our vendors and implementing ideas brought forward by staff at Department Head brainstorming meetings. Minutes from the November meetings are available for review on the board page of the Co-op website.
Bringing together all the ideas presented by staff and members, the board voted to direct Co-op staff to follow up on the following ideas brought forward at the meeting. These action items were:
- Extend our current line of credit of $149,000 to $500,000. We have not tapped into this available line of credit at all, and it does not require using the Arcata store as collateral. However, we believe we will need more than this amount to sustain the Co-op through the holidays.
- Initiate a member donation and/or shares drive.
- Continue with the aggressive cash management strategies already taking place.
The board voted to cancel the Member Action and Earth Action Committee meetings scheduled for Wednesday, November 14 and hold an additional special board meeting in their places. Updated financials were presented at the November 14 special board meeting and the board was informed that with our current working line of credit of $149,000 we could push through the current cash crunch. Hindsight again proves this to be correct – but at the time concern for the Co-op was heightened.
The board adopted an Expenditure Control Policy at the December board meeting. This policy, which the Board has never had before, spells out what kinds of expenditures must go to the board for approval, and which are within the discretion of the General Manager and other staff. Read the policy here.
General Manager Search
An important item that came out of the November 14 special board meeting was General Manager Melanie Bettenhausen’s proposal that the board start a full general manager search in January, while she stays in the job through the expiration of her contract in November 2019, and that she plans to apply for the position herself. In the executive session following the meeting, the board decided to accept this proposal, and will be discussing a work plan for a general manager search at the January board meeting. The board plans to consult with staff and members about what they would like to see in a general manager candidate. This process will allow us to ensure that we have the best person available in the position before the end of next year, without the substantial risk of going without a general manager during a financial crisis.
Member Engagement
Many members, including employee members have attended recent meetings of the board. They have offered their ideas and possible solutions to pull the Co-op through this rough patch. Enthusiasm and engagement of members is one of the reasons I was excited to join the Board of Directors almost two years ago. The ability of large groups of people to generate new and exciting ideas never ceases to amaze me. And the Co-op offers the chance for member participation to directly affect the actions of the board, and the overall direction of our Co-op.
Due to the Co-op vacating the Ten Pin building in early 2019 we don’t have set meeting locations for upcoming board meetings. We do have set dates and will update the online calendar and board boards in stores with meeting locations as soon as they are available.
