ElectriCities of NC, Inc.
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#21 Jul 15, 2008
Thought you all may enjoy this one

Sent Monday July 14

"Karen Johnson has resigned her position with ElectriCities, effective immediately. If you have any pending projects that involved Karen, please let Estherine Davis know.



Yet another message from Dick the Prick Salentine to all employees. He is so highly useful isn't he? Wait, he does tell Rebecca Agner how to do her job and then does half of it for her which must be why communications strategies are going doooooowwwnnnnn hiiiiiiiilllllllllllllllllllll lllll.

Resigned - right. How about terminated by Estherine Davis. Can you spell S-E-T-T-L-E-M-E-N-T, A-G-A-I-N. How much will this one cost us all?

Let's recap:

Alice Garland 2003; Jeannie Bonds 2007 - Tilton admits payoffs to them. Both very sharp and strategic. ps Estherine Davis was a word processor while these two were beginning their lobbying careers so consensus seems to be that Davis and Tilton were threatened by the dual brains and their success. Insecurity does it to you.

Teresa McFadden harrassed by Davis and leaves; Dan Crawford leaves suddenly; Ken Melton leaves suddenly after a very short time like what two months (ps these guys were all competent by the way just fed up with Davis and for Crawford and McFadden appreciated working for a real strategist in Bonds) but Melton gets a contract gig from Tilton as a pay off for his silence. Come on Ken speak up.

PS Dick Salentine HR guru sits by and watches all of this.

Karen Johnson hired and fired in 4 months. Remember the intro in March and now ... BOOOM. Was she harrassed too? Inquiring minds think so. Pull out that memo cities and see how great she was and now KAABOOOOM. She ain't great no more. What happened. Did she see past the duo of Tilton and Davis.

WOW. 14% rate hike. People in cities very unhappy. Lots of BIG FAT SALARIES and lots of people in cities thinking Tilton and Davis are incompetent anyway. AND lots of people gone. There has to be a story here.

Payoffs on top of rate increases. And there has to be a big fat lawsuit looming. Will they all sue together or will they take them apart separately? Summer and Fall should be fun. And we think there is any question as to whether Tilton should lead this place. really now. We could bring a corpse in here and do better.

Sam Noble and Fred Turnage - what do you have to say to defend this? Should Tilton alone be responsible for all of this or should it be Tilton and Davis. Or should the Board take the blame? Several board members are on the record as thinking Bonds and Garland were great and things have been dooooooowwwwwwnnnnnn hiiiiilllllll since.

Quite the track record. Tilton - 2; Davis 4. Board down. Here's the N and O breakdown for the ups and downs.

And the best part is, the rest of staff is told to sit back and ignore these posts cause they can't be true even though we quote from the emails we get. Yeah/Right/Sure. Senior Management does not even lie well anymore.

United States

#22 Jul 15, 2008
Read BlueNC for more analysis by Dan as to how ElectriCities is hiding the truth and spinning some yarns. Phenomenal job Dan. Keep it up. You are a stealth reporter.

"First, don't let them get away with the "hindsight is 20/20" defense. It always assumes that you don't remember your history. From the Rocky Mount Telegram article:
Kenneth M. Raber, senior vice president of ElectriCities Services/North Carolina Eastern Municipal Power Agency, said hindsight is always 20-20. But given the facts in 2004, it made a lot of sense for the power agency to convert some of the fixed-rate bonds. Fixed-rate bonds in 2004 had interest rates of 5.6 percent, compared to 3 percent of the variable ones, he said.
"Who could have predicted the sub-prime (mortgage) crisis?" Raber said. "If the same set of circumstances (in 2004) presented itself today, we'd probably make the same decision.
From the NCEMPA's own annual reports:
By using derivative instruments, the Agency exposes itself to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract...
Market risk is the adverse effect on the value of financial instruments that results from a change in interest rates. The market risk associated with interest-rate contracts is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.
Fred Turnage, the former mayor of Rocky Mount who also is an ElectriCities board member, said it would be unfair to single Tilton out for the decision to go to the variable-rate bonds.
"It is pretty standard practice to have variable-rate debt as part of a prudent financial strategy," he said.
He also said a number of North Carolina entities – from airport authorities to health care organizations to publicly traded companies – had decided to invest at least some of their portfolios in variable rate bonds, whose rates can fluctuate depending on market conditions.
Don't fall for the "prudent financial strategy" line without asking the logical follow-ups:
Which North Carolina entities?
Which parts of their portfolios did they invest in variable rate bonds? Short-term assets? Their long-term obligations?
Were they swapping fixed debt (at 5-6%) for variable debt?
How did they manage their exposure to variable interest rates?
In short, interest rates were falling. ElectriCities didn't lock in historically low rates by issuing new fixed rate bonds. Instead, management traded a higher fixed rate for the risk of a lower, but floating rate on bonds related to long-term assets (like, um, power plants). They knew there was a risk; they even disclosed the risk in the annual reports. Now would be a good time to ask about how that risk was managed and monitored (instead of giving them a pass because "everyone else did it too" or even worse, "the bankers told us to do it").
And finally:
Rocky Mount City Manager Steve Raper, who also is chairman of the the power agency's rate committee that recommended the increase, said Rocky Mount can't get out of the deal.
"We are locked in contractually (with the power agency) through 2024," he said.
Keep in mind that the General Assembly only gave the Agency the ability to enter into long-term contracts a month ago. Was Rocky Mount asking the probing questions about the rate hike? Did ElectriCities lay out a compelling 16 year plan?

United States

#23 Jul 15, 2008
which should bring you back to the same question: Who is watching ElectriCities? In the end, it is the only question that really matters. Don't paint a picture about rising fuel costs or even rising interest rates. You can't stop the fuel costs and you can't stop the rates. But you can demand accountability for mismanagement.
Paint a picture about a management team that is making mistakes that are costing taxpayers and consumers. Paint a picture about a Board of Directors that seems to be rubberstamping bad decisions. Paint a picture of a Board of Commissioners made up of mayors who may or may not know as much as you and I know about the power industry, corporate finance, or any of the other areas of expertise that may come in handy when serving on the board of a utility company.
If the Executive Management team isn't making good decisions and the Board of Directors isn't making good decisions, who is making the good decisions for the cities and towns that are members (and by extension, the taxpayers and consumers that are paying for the mismanagement)? What's the point of having a Board of Directors or a Board of Commissions if those boards aren't going to do their jobs?
Ask the questions and find the answers."
We need this guy running ElectriCities or on the Board

United States

#24 Jul 17, 2008
Hey, ElectriCities … give us a break!
By Jeff Herrin | Tuesday, July 15, 2008, 04:37 PM
Whatever you might think of the six-digit salaries commanded by almost 30 top executives at ElectriCities or the skyrocketing interest rates on some of the debt held by the management company, there’s no denying that things are getting tough for local businesses.
As Telegram staff writer John Henderson reported Sunday, the proposed 14 percent electric rate increase is likely to have a big impact on everyone - from giant power users such as Nash General Hospital to mom and pop operations such as Koretizing One Hour Cleaners. That doesn’t even begin to address the folks like you and me, who are likely to see our utility bills jump if Rocky Mount passes along the increase.
ElectriCities board members told Henderson that the salaries paid to top executives (CEO Jesse Tilton makes almost a half-million a year) have to be high to attract the best and brightest to those positions. Board Chairman Sam Noble also defended ElectriCities’ borrowing practices, saying the board signed off on the deal that converted fixed-rate bonds to those with variable rates, too.
That’s all well and good, but neither factor makes the rate increase sit any better with the rest of us. The top executives of ElectriCities would buy themselves a world of positive press if they would announce plans to take a pay cut this year. At the very least, why not stagger the increase? A 7 percent hike now and the rest in January would still hurt, but at least it would spread out the pain a little bit.
There’s no point in kidding ourselves. Energy costs are going up all over the country. Even so, the taste of that increase is especially bitter to Rocky Mount and the 31 other cities in the N.C. Eastern Municipal Power Agency, which ElectriCities is paid to manage.
How about sweetening the deal a little?

Alingsås, Sweden

#25 Aug 8, 2008

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