WRAL Investigates

South River Electric CEO's pay 'excessive,' member says

Posted March 21, 2011

WRAL Investigates
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— Long considered a valued power source and community partner, South River Electric Membership Corp. is now getting some static from some frustrated members.

Laurie Chancy, a Sampson County tobacco and sweet potato farmer who relies heavily on the cooperative's electricity for her greenhouse and storage facilities, said recently that she and other South River members were stunned to learn about some board practices and executive pay.

Tax records show Chief Executive Buddy Creed makes $484,000 in total compensation to run the not-for-profit utility, which has 98 employees and about 42,000 customers.

“To me, it seemed excessive,” Chancy said.

South River public affairs manager Cathy O'Dell stressed Creed's experience and expertise. Plus, she said, the corporation uses an outside human resources consultant to recommend employee pay in line with similar sized co-ops.

“We pay within fair market value,” O'Dell said.

South River Electric CEO's pay 'excessive,' member says South River Electric CEO's pay 'excessive,' member says

WRAL Investigates found Creed's pay tops most of his electric co-op peers around the state. The head of French Broad Electric Membership Corp., for example, makes $185,000, while Wake Electric Membership Corp.'s chief makes $402,000 and the head of Carteret-Craven Electric Membership Corp. makes $228,000.

“Why does anybody need to make that much money? You know nobody needs to make that much money,” South River member Jonathan Temple said.

“It creates suspicion and unrest,” member Cris Jackson said. “That really gets people's attention.”

Another thing getting attention is the South River Board of Directors meeting policy. Members who want to attend must fill out an application weeks in advance.

“The secrecy of it all is the red flag,” Chancy said.

O’Dell said the board just wants efficient, organized meetings. With the notice policy, there's no record that a member applied and attended a board meeting ever.

“I feel like we communicate very well with our members,” O’Dell said.

Yet, even with the South River website, press releases and monthly magazine, some critics said they still see a disconnect.

Longtime members are entitled to share in company profits each year, but 10 years ago, the board quietly decided to discount lump-sum payments when members die, which Jackson said was a surprise.

“We want people to have what they've earned,” Jackson said.

“It's not in an account somewhere drawing interest,” O’Dell said. “That money is out there in the lines, in the substations, in the transformers.”

O'Dell cites South River's customer service ratings and service projects as evidence the utility meets its mission. Some members said they think the mission needs to be rewired.

“Maybe we'll get some new board members on the board of directors with new eyes, minds and voices, and I think that's what we need,” Chancy said.


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  • vcrandall Mar 29, 2011

    Electric Membership Cooperatives (EMCs) are non-profit organizations owned by members. The members also happen to be the customers that purchase electricity from the EMC. In North Carolina, there are 26 EMCs. Board members at some EMCs across the country, have become arrogant, received large salaries and excessive expense allowances. Many have prevented good governance and transparency of decisions with their members. In fact, a Web site "Coop Litigation News", addresses the abuses taking place at some of these EMCs: www.coop-litigation.com.

  • huffstetlerfamily Mar 25, 2011

    Love all the "experts" running their mouths about something they know nothing about. Of course you will never get the whole story if you depend on a media that tries to sensationalize everything to get more viewers.

    Bottom line if you are not a South River EMC member, then shut-up

    If you are a South River EMC member then run for the board, support a new board member, or shut-up.

    The people interviewed had an obvious beef with the CEO and I would bet just about anything that their professed gripe is not their real issue, this is just a means to an end. I would go as far as to say their gripe has more to do with them making more money than the CEO making to much.

  • b1llbrasky Mar 22, 2011

    I think Mr. Jonathan Temple missed his calling. Running for a seat on the board for a coop should be small time for him. Based on his comment I think he would make a great addition to the present administration in Washington. He definitely sounds like he would be great at determining how much is to much when it comes to salary; which of course would help tremendously when it comes to “spreading the wealth around.” I definitely think these candidates are more concerned with serving themselves than their fellow members. There is absolutely nothing wrong with striving for success in one's work, but it sounds like these folks begrudge him for that.

  • sunshine1 Mar 22, 2011

    Groovy-you are right on (70's lingo overload there!). And don't we have better things to do than bash someone who apparently worked hard and made a success of himself? Heaven forbid someone should strive for something beyond mediocrity in this country. Let's start campaigns against all the successful folks. That's a brilliant way to operate. The winning through whining strategy will take us right to the top as a society.

  • bigsix842 Mar 22, 2011

    I know for a fact that this Coop spends slush fund money recklessly. I worked a job where hundreds of thousands were spent friviously by this coop. For you Sampson County folks, you are spending way too much for electricity given their ability to spend on stupid projects. And the decision maker is this overpaid bureaucrat.

  • Groovy Mar 22, 2011

    tish101 - an Electrical Engineering Degree would absolutely qualify to manage an electric cooperative....

  • Karmageddon Mar 22, 2011

    Give the man a break....he's just keeping in line with the ABC boards

  • terryp Mar 22, 2011

    I see Ms. Odell put the word out that her board members should login and defend this outrageous salary. If you notice, his was the HIGEST of all the co-ops. Yes, I'm sure he does a lot, and you can guarantee South River will never be a Not-For-Profit with salaries like that.

  • billymac59 Mar 22, 2011

    Wow...WRAL sure can make a mountain out of a mole hill! To begin with Ms. Saulsby stated in the teaser before the segment aired that the CEO's salary was almost a million dollars per year....wrong. I didn't know $484,000 was almost a million. If everyone listened closely Mr. Browder said that the figure was his entire compensation package not just his salary. That figure should include things such as his retirement and medical benefits. Co-ops are controlled by a board of directors and South River along with all other cooperatives have an annual meeting, so members can vote and even replace board members when needed. It was really funny that the only members interviewed were members seeking a postion on that board. Also I have to question the honesty and accuracy of the reporting when most of the poles and lines shown in the segment were NOT even South River's territory! All cooperatives are not perfect and South River may have some faults, but every member can always speak to a board

  • tish101 Mar 22, 2011