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Pedernales Electric Co-Op chooses Garza as General Manager

Friday, January 4, 2008 by Austin Monitor

The Pedernales Electric Co-Op on Thursday hired Austin Energy General Manager Juan Garza as its new General Manager.  Garza, 63, said he would consult with City Manager Toby Futrell about when he would take over the largest electric cooperative in the U.S. but he is likely to make the transition in February.


Until Thursday, Garza was one of three internal candidates vying to be City Manager upon Futrell’s retirement. The co-op will pay him $350,000 annually plus $1500 a month in car expenses, plus a bonus to be determined at the end of the year. He earns about $211,000 a year at the city.


Futrell said, “I think Juan is going to be a very big loss for us, more than just at Austin Energy. He had a key role on the executive team that was about more than Austin Energy.” She praised his work as part of her team, noting that he had a strong financial background as well as expertise in the human resources department, which he headed before moving to Austin Energy in 2002.


“It’s a big opportunity for him,” Futrell said, noting, “They offered a compensation packet that I couldn’t touch, couldn’t come close.”


Futrell said she would name an acting general manager for the utility, leaving the decision about a permanent replacement to the next city manager. She noted that her successor would have to make decisions about the leadership at the Public Works Department, EMS, and in the Comptroller’s Office, where there are acting directors. She said the city had spent a lot of time on succession planning

five or six years ago.


Garza told In Fact Daily tonight that the 17-member co-op board voted unanimously to offer him the position after interviewing him for several hours.


Garza said his most important job at the co-op would be “continuing the tradition of great customer service and moving into a tradition of accountability and openness, moving to the future.”


While mostly serving the Hill Country, the PEC’s service area includes parts of Northwest and Southwest Austin, Georgetown, Leander and Cedar Park. Garza said he had contacted the two state senators whose districts cover the service area Kirk Watson and Fraser. He said he would be talking to the other representatives of his customers also to reassure them that the co-op would be run in an open manner.


He pointed out that the PEC has the highest customer satisfaction rating for an electric co-op within the U.S. and the fifth highest for a public power company, “So they’ve been doing a lot of things right. And I think I can bring the style of management that I believe in…I’ll take that over to the PEC and I think it will serve me well.”


Garza said working for the co-op would not require him and his family to leave Austin. “That’s the beauty of it . . . I could commute from Austin to Johnson City…it’s exactly 40 miles from my driveway,” he said.


Garza told the Austin City Council Thursday morning that he would be interviewing for the job Thursday afternoon. The Council named eight finalists for city manager, including Garza, before he concluded his talk with the PEC board.


In mid-November, the PEC Board announced that President W.W. “Bud” Burnett and General Manager Bennie Fuelberg were stepping down after more than three decades with the utility. Their management of the member-owned utility had been harshly criticized and a group of co-op members filed suit against the PEC over its management policies in May.

Fuelberg walked away with more than $2 million in deferred compensation over five years, making his annual salary for the past few years almost $900,000, a figure many co-op members considered excessive.


Burnett was paid $191,000 a year in his capacity as Board Chair and as PEC’s “employee coordinator,” even though he did not have an office, desk or telephone in the utility’s offices.


The Nov. 9 announcement came after three members of the co-op’s board of directors and its general counsel met in Marble Falls with state Sen. Troy Fraser (R-Horseshoe Bay), the most prominent of the critics.


In addition, the board members also announced several reforms that came out of complaints from co-op members, and reflected issues in the lawsuit.


Changes include the co-op paying back $7 million in capital credits to co-op members who joined before 1977. It will retire capital credits on a 30-year rotation to members who joined the co-op since then.


In addition, the election process will be changed to make it easier for challengers to campaign against the board-nominated slate. Candidates can now be placed on the ballot by a petition with at least 25 signatures. Board members must receive electric service from the co-op, and they may not benefit economically by providing services to the co-op.


Garza became General Manager of Austin Energy in January 2002 after serving as the city’s Human Resources Director for 14 months.

Garza came to Austin after being a Corpus Christi-based consultant specializing in urban issues. He worked for the City of Corpus Christi beginning in 1983, and served as City Manager from March 1988 to May 1996. Prior to that, he worked for the cities of Moline, and Evanston, Illinois.

He received a Bachelors degree in 1972 and a Masters of Business Administration in 1977 from Loyola University in Chicago.

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