Sources: PEC gave chief $1.1M to depart
Co-op board approved the deal 10 days after rancorous meeting.
The former chief executive of Pedernales Electric Cooperative was awarded an estimated $1.1 million to leave quietly in May, the American-Statesman has learned, on the heels of a dramatic board meeting in which he announced his intent to resign and accused board members of retaliating against employees who spoke out against perceived racism at the electric utility
John D. Hewa, who became the co-op’s CEO in July 2013, had an employment agreement that d idn’t entitle him to “separation pay” if he resigned voluntarily. Still, the co-op’s board approved the deal for Hewa in an executive session that took place during a May 25 emergency meeting, less than two weeks after the rancorous regular meeting May 15.
The co-op hasn’t released the financial details of the separation agreement with Hewa, but sources with knowledge of the deal confirmed the amount to the Statesman.
Co-op board President Emily Pataki didn’t respond to requests for comment this week. Tracy Golden, the co-op’s chief financial officer who has taken on the duties of chief executive in the wake of Hewa’s resignation, declined to comment.
Hewa couldn’t be reached for comment.
Co-op spokeswoman Alyssa Clemsen-Roberts called the issue a personnel matter that co-op officials won’t discuss. She said
financial details of the agreement with Hewa will be available in the co-op’s 2017 tax return. However, that document won’t be released until next spring or summer.
Pedernales Electric — one of the largest nonprofit, member-owned electric cooperatives in the country, serving nearly 300,000 accounts — publishes its tax return each spring or summer for the prior calendar year, as federal law requires for a nonprofit entity. According to a recently released draft of the 2016 document, Hewa was paid $714,234 in “reportable compensation” last year and $67,642 in “other compensa- tion.” He had a base annual salary of $500,000 when he was first hired four years ago.
Charges of racial insensi- tivity have dogged the co-op since last fall, when board member James Oakley wrote on social media that it was “time for a tree and a rope” in reference to an African-American suspect in the killing of a San Antonio police officer.
Oakley, who also serves as Burnet County judge, deleted the post and apologized publicly for the statement. He has denied that he had any racist intent in making the remark, telling the State Commission on Judicial Conduct that he was thinking instead about hangings in the Old West and the humorous take on them in a 1980s TV commercial for Pace Picante Sauce.
The commission rejected his explanation, formally reprimanding him and requir- ing him, among other things, to participate in four hours of racial sensitivity training with a mentor.
In January, the co-op’s board voted to reprimand Oakley and demote him from a board leadership position, but some Pedernales Elec- tric employees and members have contended the punish- ment wasn’t sufficient.
During the May 15 board meeting in which Hewa announced his intent to resign, he accused board members of “inappropriate” conduct in the wake of the Oakley incident and said he couldn’t continue as CEO.
“Conditions for some of our key employees in the organization have become untenable because of the conduct of the board,” Hewa said at the time. “Those of us who spoke up to support minority employees and to object to racially insensitive comments were assured that retaliation would not occur. This has not been the case.”
But a joint statement that the board and Hewa issued after the May 25 emergency meeting had a significantly altered tone.
Hewa “has decided to move back to Virginia with his family and pursue new career opportunities,” the board’s statement said, going on to congratulate him “on his many achievements.”
Hewa said he was proud of the co-op’s accomplish- ments during his tenure and called it “a remarkable organization with exceptionally talented employees.” In perhaps a reference to the May 15 rancor, however, he noted in the statement that he had “previously shared my concerns and hopes for PEC with the board of directors.”
Larry Landaker, a former co-op board member who served when Hewa was hired, said he isn’t surprised that the current board offered a separation package to Hewa or that Hewa chose to accept it and leave quietly. Landaker called Hewa “a low-key guy” and said Hewa likely wanted to avoid a headline-gener ating fight with Pedernales Electric’s board.
“An injustice was done to a good man,” Landaker said.
Landaker, a critic of the current board who operates the website PEC Truth watch, hadn’t heard details of Hewa’s separation agreement or spoken to Hewa but said the board should make the deal public.
“They need to actively publish that information for the members,” he said. “It is the members who are paying him whatever settlement they agreed to.”
The $1.1 million package that sources say Hewa was awarded upon his resignation is in line with the estimated $1 million in severance former co-op chief Juan Garza received when he was fired by the board in 2010. Garza’s severance was widely reported shortly after his firing.