Board of Directors Meeting Minutes
February 27, 2018
Attending: Molly Moon (by phone), Nick Licina, Danielle Meersman, Chris Hebron, Charlene Rountree, Myles Robertson, Fred Myers, Sarai Godwaldt, Mike Geglio
Minutes of last meeting reviewed and accepted
Member-owner comment: no visitors
Board Election Updates
2 possible candidates were thinking of attending tonight’s meeting, but were unable to do so. Both are likely to follow through and run. One has an HR background, and the other has a legal background plus served on the board about 5 years ago. They have each met with current board members, and the impressions were very positive.
Mike had exchanged emails with 2 other possible candidates who are member-owners, and who might be interested in a future year but not this time around.
The slate of candidates needs to be presented to the member-owners a month ahead of the election. Originally we had hoped to finalize the list by March 1, but March 15 will work.
Policy Register Committee
Sarai explained the charter of the Policy Register Committee, whose purpose will be to oversee the process of updating the PPC Policy Register to ensure it stays current over time with the co-op needs.
Sarai has arranged for biweekly calls with Thane to consult on the process.
The goal is to have a process in place by April of this year.
Annual Meeting Committee
Nick and Myles have begun to plan for the meeting. The date will be April 22.
Sarai volunteered to join the committee. Molly wants to be involved but will not return to South Bend until April 5. However, if any work can be handed off to her, she is willing to handle it.
Plans need to be in place by the end of March.
Events that could be related to the AMM include the activation of the solar panels, of recruiting member-owners to aid in a clean up effort (landscaping around the co-op, neighborhood or riverbank).
Considering a day with Habitat for Humanity as a way to engage member-owners and the board in a community project. 10 homes are being started. The construction begins in mid-September and continues through October. Pre-work (lot preparation) begins in April. Envisioning 16 to 24 participants.
Jimmy Carter will be on-site for a time, and groups that contribute $25,000 can be scheduled to work with him. We could challenge member-owners to raise that amount.
C2 - The Board’s Job
Reviewed C2 in the Policy Register
Molly noted that C2 references the Ends Statement, but does not contain the statement. Sarai said that she planned to include the statement in the updated version of the Policy Register.
Article on Co-ops: engaging member-owners and understanding their needs (Molly)
Member-owners make up 55% of PPC co-op store sales; 55% is considered a healthy percentage for co-ops in the industry.
Reaching out to member-owners has to be a continuous effort; it’s good to schedule events like Habitat for Humanity or neighborhood clean-up annually.
Myles explained his theory that what member-owners buy in the store tells you what they want from the co-op. It is possible to capture that data at the point of sale for analysis.
Once the basic needs are met, it is easier to develop more active member-owner involvement
Thane describes the effort to reach out to member-owners as frustrating and difficult, but says the board just needs to keep trying different strategies.
Should the board have business cards to hand out to member owners? - consensus is no.
Photos of board members should be on the PPC website now (March 3, these photos are on the Board page)
[Nick Licina] [Molly B. Moon] [Mike Geglio]
Setting up a board table at market night and special events did not seem to attract member-owners for discussions.
Suggestion to help at the register on market night to bag or carry groceries. Available to explain the benefits of joining the co-op if the shopper is not a member-owner.
GM Report - B6 Staff Treatment & Compensation
Myles reports that policies B6.2, 3 and 5 are compliant. B6.1 and 4 are out of compliance.
B6.1 - written personnel policies: Myles had wanted to complete the handbook by the end of January, but was unsuccessful. The new plan is to complete the handbook by the end of March. He is focused on incorporating Lean principles, trying to apply more effective principles and reduce waste. Katie is producing the handbook information for the kitchen employees.
Question: should the employee handbook be reviewed by a lawyer? It is based on the CDS model, with extra PPC specific language, so should be OK. We could ask a lawyer for a quote to determine the cost. If the new board member has HR experience, we could be guided by that person, particularly with regard to state laws. This last alternative was the consensus agreement.
Myles plans to keep a record for each employee’s individual handbook training. Maureen went to an HR training session in January. What she learned changed how the co-op now records and stores documents.
B6.2 equitable compensation: Myles presented the employee wage table. The pay range has been broadened to provide more flexibility. New untrained employees start at less than experienced employees. The table defines steps for wage increments and earning potential. Myles considers this policy to be out of compliance because it doesn’t compare to other co-ops for some positions. Specifically the GM and business manager are underpaid by industry standards. Myles presented his plan for remedy, which involves specific ideas to grow sales:
New Grab & Go products (12 new items in deli now)
Extend Sunday hours from 5pm to 6pm. The last hour on Sundays is the most busy, and the register is regularly kept open after 5 now to accommodate shoppers.
Myles will continue to monitor and reduce payroll to control costs.
Increasing net profit will allow the co-op the ability to afford to pay top managers more appropriately.
At the close of the meeting, the Board reviewed the GM B6 report using the Decision Tree, and voted to accept the report and the remediation plans.
Next meeting items:
Candidate list: finalize the board candidate slate
Policy register B5
Report on IRS penalties to the co-op (Danielle)
Following the GM turnover last fall, an unopened 9 month old letter from the IRS was found in a desk drawer. The co-op payroll level required payroll taxes to be remitted bi-weekly, not monthly, and the co-op was out of compliance.
The co-op immediately began filing bi-weekly, but the IRS applied a late fee equal to 10% of the late filings, or $1900. Danielle asked for a penalty waiver, but the IRS representative said that waivers had been granted in the past to the co-op, so this one was denied. Information about IRS waivers had not been reported to the board by the previous GM.
Danielle asked the IRS if there were other unaddressed penalties, and learned that the W2s and the W3 (summary of all W2s) had not been filed in 2013. This resulted in an outstanding civil penalty. Danielle faxed in the form and asked for a penalty waiver, which was denied. The resulting fine is an additional $2700. Information about the failure to file the W3 in 2013 has never been presented to the board.
The news that both waivers had been declined were received from the IRS earlier this month (February 2018). The fines have been paid ($4600 total). These were avoidable costs to the co-op. They are a drag on the current GM’s efforts to drive the co-op to a profit this year. If questions arise at the AMM about the GM change, this information may be pertinent.
GM evaluation (Charlene)
Question raised about a CDS GM evaluation form that Thane recently sent. Should we use that instead of the revised survey from last year? After much discussion, the board voted to continue with the revised survey this year. Beginning in March, we can implement the CDS form for next year. However, there are questions about information that is to be collected at each board meeting. A process needs to be put in place to use the form properly.
Nick requests that board members participate in a call to Thane sometime in the next 2 weeks.
To Do for all: send Nick the dates in the next 2 weeks that you cannot participate. He will schedule a call accordingly.
Discussion about proposed wording changes to the GM evaluation survey, and decisions made to complete the form. Charlene is making the changes.