DAVIS FOOD COOPERATIVE, INC.
BOARD OF DIRECTORS
MEETING MINUTES
June 2007
Call to Order
The regular monthly meeting was called to order at 6:33pm at the Davis Food Co-op Conference Room, 620 G Street, Davis, California, by Julie Cross, Director, Board Secretary and Facilitator.
Roll Call:
Directors Present: Winston Berger, Daniel Berliner, Julie Cross, Debbie Eernisse, Lucas Frerichs (arrived at 6:48 pm), Danyal Kasapligil, Darius Pazirandeh (arrived at 6:50 pm), Ben Pearl, Doreen Pichotti,
Directors Absent: Jared Davis, Joy Rowe
Staff Present: Beth Tausczik, Kenna Krueger, Doug Walter, Eric Stromberg, Seth Larsen, Sara Eley
Guests Present: Jack Young, Steve Reynolds, Janie Booth, April Kamen, Joan Randall, David Thompson, Bernadette Murray, Dave Bakay (arrived at 6:49pm), Jay Erker (arrived at 7:13 pm)
Roles:
Facilitator: Julie
Time Keeper: Winston
Notetaker: Sara Eley
The Secretary determined that notice of the meeting was duly provided as required by Bylaw Art. VIII §6(C), and that a quorum of Directors was present under Art. VIII §6(B).
Introductions:
Julie introduced Sara Eley, who is trying out the role of notetaker, and reminded everyone that we would be trying for minutes which still contained topics discussed, but which were some shorter. She noted that any Director may ask that something be noted in the minutes if they wish it recorded.
New policy regarding comments was discussed. Member comments will now be limited to 3 minutes (total speaking time) per meeting.
Member Comments:
Winston Berger: Thanked the Board for and enjoyable 3 year term and offered well wishes for the renovation and the Co-op’s continued support of on site foods. He also mentioned that an in-house bakery would benefit the Co-op and the Davis community.
Joan Randall: Joan distributed copies of her response to Deb’s email of 5/21. She commented on the harassment threats to Eric Stromberg’s family and urged the Board to investigate and solve, if so. She discussed the ‘5 year plan’ that involved the duplex and how that plan was not well received and compared it to the idea of Modular Renovation so that pieces could be started and completed, section by section. Joan also commented on Eric’s compensation package and quoted Charles Scherz: ‘Our country right or wrong should be kept right when it’s right and to make it right when it’s wrong’.
David Thompson: Made formal complaint regarding election requirements not being upheld. He challenged the 98 vote margin.
Letter provided.
Dave Bakay: Commented on an article in the Davis Enterprise contrasting the optimism of the recent Flyer mailing to community of Davis against the fact that there were little or no ‘con’ arguments regarding the Renovation plan. He was bothered by the ‘package deal’ loan plan – that it did not reflect any options and that the information distributed, deemed several items urgent in the mailing that he felt were not relevant and did not address the center of the store.
Joan Randall left the meeting at 6:56 pm
Announcements:
Doreen: advised of meeting ground rules
Ben: revised monitoring report submitted & announced that he will need to leave the meeting at 9 pm
Eric: purchased carbon offsets (ex. Solar/wind power) through the NCGA for approx. 80% of Davis Food Co-op’s consumption
Lucas: would like to rewrite GP2 policy rather than report on current policy – Will create new descriptions with Deb’s help. Removed GP1 and GP3 from consent calendar
Consent Calendar
Presented: Consent Calendar Items
Retained by unanimous consent:
Approval of Minutes – May 2007 (Julie)
Task force report (Darius)
First reading: GP9 revisions and monitoring (Debbie)
Report: BGM3 Accountability of the GM
Approve 2007-08 budget
Removed by objection:
First Reading: GP1 revisions (Ben)
Report: GP2 Board Job Descriptions
Report: GP3 Agenda Planning
Approve 2007-08 Calendar
Motion: Lucas moved to adopt the consent calendar as amended
Dan B. seconded
Motion is adopted unanimously.
Agenda Review
Amend Agenda by accepting resignation of Director, Jared Davis.
Motion: Debbie moved to adopt the agenda as amended
Julie seconded
Motion carried unanimously
Removal of director
Motion: Darius Moved that the board accepts Jared Davis’ resignation contingent upon receipt of written confirmation
Julie seconded
In Favor: Winston, Dan B., Julie, Debbie, Danyal, Darius, Ben, Doreen
Opposed:
Abstained: Lucas
Motion carried
Motion: Darius moved to appoint Daniel Berliner as a director
Debbie seconded
Motion carried unanimously
Motion: Darius moved to elect Debbie Eernisse as replacement treasurer
Julie seconded
Motion carried unanimously
Reports
General Manager's Reports
Eric Stromberg presented Monitoring Reports on
• B4 (A) (2) – Legality and Propriety of Retained Patronage Refund
• B9 Member Relations
• E1: We are full service grocery store with Choice•
• B11 – Renovation
• strategic plan B11(A)
• competitive bidding B11 (C)(iv)(d)
• outreach B11(B)
Eric - B4/Patronage Refund: The Department of Corporations suggests that there is an exemption for ‘Co-op’s” and that a permit is not required – refunds are ready to go and consulting attorneys agree that refunds to shareholders is appropriate. For future reference: A permit would be required for a member loan program or if member investment increased. Eric will pursue a written ruling from the Department of Corporations on withheld patronage refunds for future use.
Seth – B9/Member Relations: Member regulations have been met as required by law. No member info has been shared or distributed. No requests to inspect the member database have been made. The annual meeting was a success – member driven activities, like these, are well received by our community.
Beth – E1/We are a full service grocery store with Choice: Extensive report submitted (5.1C) emphasizing full choice and natural foods. Compliance met in all areas except Food Safety, Safety, & Record Keeping. However, DFC is a very safe store. Record keeping has been refocused. The recent inspection by the Health Department passed. Beth met with Ben and Doreen and identified that tracking and data systems could improve, local and bulk tracking within specific departments would be helpful, the POS system is out of date. Recent top sellers: bananas, water, Pabst Blue Ribbon. Ben and Beth discussed methods of tracking local products in bulk. Local is defined by a 100 mile radius and cross referenced by analyzing zip codes.
Motion: Lucas moved to accept E1 as presented
Darius seconded
In Favor: Winston, Dan B., Debbie, Lucas, Danyal, Darius, Ben, Doreen
Opposed:
Abstained: Julie
Motion carried
Motion: Deb moved to accept B4 and B9 as presented
Dan B. seconded
Motion carried unanimously
B11/Renovation Discussion:
Strategic planning: To be discussed at the July retreat
Competitive Bidding: Selection of contractors should not be based on price alone – quality and reputation should be considered. Architect were juried by having grocery store experience and Sutti was the only one that included a ‘comprehensive plan’ that encompassed things beyond the construction (ex. ideas for smooth operation during the changes)
Outreach: Information is available in the store, on the website, newsletter. Discussion about having one more membership meeting to continue to gather feedback from members
Motion: Deb moved to accept B11 with contingency that the General Manager document architects, interviewing and decisions made: also to include another member meeting before Phase 1 construction – giving time to meaningfully incorporate member comment into the plan.
In Favor: Winston, Dan B., Julie, Debbie, Danyal, Darius, Ben, Doreen
Abstained: Lucas
Motion carried
Eric/Kenna – Resolution of Patronage Refund Questions: $140,000 issued in shares and $200,000 in cash would not impact remodel/loan. Kenna suggested that looking at the long view – if done over 5 years at 20% the net gain would be substantial in cash reserves because although more would be paid out over time; it would not be all at once. There have also been 2 supreme court rulings upholding Ag. Co-op’s right to retain patronage in this manner however there may be tax consequences so refunds will be issued and these items will be addressed in the cover letters.
David Thompson (member comment): Explained the differences between an Ag vs. Consumer Co-ops and feels that the Co-op has not provided enough financial information to members regarding the renovation funds. He believes that the vote should be nullified and voted on again.
David Thompson left the meeting at 7:37 pm
Motion: Darius moved that the 2005 – 2006 Patronage Refund is to be distributed 100% , with 80% in shares and 20% in cash and that Davis Food Co-op Board of Directors authorize GM/Eric Stomberg to take the necessary steps to complete distribution by June 15, 2007, with the minimum refund of $5 and amounts below that to be held as patronage refund.
Doreen seconded
In Favor: Winston, Dan B., Julie, Debbie, Lucas, Danyal, Darius, Doreen
Opposed:
Abstained: Ben
Motion carried
Recess at 8:16 pm; reconvene at 8:39pm.
5.4 Election Results
Eric Stromberg presented the Election results:
Proposition One passes: 727 yes votes, 628 no votes.
Directors elected to 3 year terms: Steve Reynolds (574 votes), Jack Young (561 votes) & Darius Pazirandeh (559 votes). First Alternate: Janie Booth (492 votes). Second Alternate: April Kamen (415 votes). Special thanks to Courtney Hopf (375 votes) and Jay Erker (243 votes).
Preliminary turnout is 18.48%, with 1,370 valid ballots among 7,415 shareholders in good standing on 5/30/07.
Julie presented the Election Committee’s report on Bylaws equal access during election – newsletter ad, website access, impartial analysis, annual meeting, and flyer
Newsletter ad: This was created to have a visual, easily understood point of reference for the upcoming renovation. It was meant to be easily interpreted and Some felt that it was skirting the line of endorsement, advertising and overselling. Overall it was well received and the membership spoke with supporting votes to move forward.
Website Access: DFC official site + Davis Wiki offered access to all available renovation/loan information
Impartial Analysis: Both sides feel that if more time was given to research votes could have been swayed in either directions. Overall a good faith effort, in the vein of the past, was made. Moving forward, researching a firm to conduct an ‘outside’ analysis may be something to consider.
Flier: The flier provided relevant renovation information that was available at the time of
the printing.
BE Murray felt that the flyer was nonspecific, not brief and included speculative arguments that were not helpful in analyzing the argument of smaller loans costing more than large and the impact financially.
Doug Walter questioned the potential lawsuits should the election results not be approved
Julie Cross brought up that if the election was challenged then the renovation loan would also need to be challenged
Motion: Danyal moved to accept the election results
Doreen seconded
In Favor: Winston, Dan B., Julie, Debbie, Danyal, Darius, Ben, Doreen
Opposed:
Abstained: Lucas
Motion carried
Unfinished Business
Motion: Darius moved that Initiation is approved for Phase 1 and 1A of the renovation master plan, as described in the phase 1 and 1A budget summaries, with the addition of demolition of low ceiling in the grocery warehouse, new warehouse shelving, and conversion of the former cheese prep area into demo prep for an estimated budget of $1,375,457, plus a 10% contingency amount of $137,545, totaling $1,513,002.
Lucas seconded
Motion carried unanimously
Motion: Debbie Moved that the Board thank outgoing Directors Winston Berger, Ben Pearl and Daniel Berliner for their services to our community in the past year, and further moved that we direct the General Manager to provide each of them with the Superworker discount for one year as a token of our appreciation.
Lucas seconded
Lucas moved to amend the motion to include Jared Davis
Darius seconded
In Favor: Darius, Dan B., Doreen, Lucas
Opposed: Julie Debbie, Winston
Motion carries
Meeting Evaluation
What Went Well?
Longer break for constructive conversation, the E1 report was exceptional, all agenda points were handled & the meeting was focused and on task.
Upgrades
Allow members 5 mins. for comment; restricting key staff and experts from speaking will prevent the Board from understanding issues brought forward. A better method of responding to member questions need to be researched; maybe a professional facilitator?
Next Meeting – August 6, 2007
Facilitator: Lucas
Time Keeper: Debbie
Recorder: Sara Eley
There being no further business to come before the meeting, it was adjourned at 10:09pm p.m. by a motion made by Winston, seconded by Dan B., and passed unanimously.
/s/ Julie Cross, Secretary
__________________________________ ______________________
Secretary, Davis Food Cooperative, Inc. Date Approved