DAVIS FOOD COOPERATIVE, INC.

BOARD OF DIRECTORS

MEETING MINUTES

December 3, 2010

Call to Order

The regular monthly meeting was called to order at 7:01 at the Davis Food Co-op Teaching Kitchen Conference Room, 537 G Street, Davis, California, by Julie Cross

Roll Call:

Directors Present: Janie Booth, Julie Cross, Sam Citron, Theodora Consolacion, Desmond Jolly, Steve Reynolds, Frank Fox, Dina Biscotti


Directors Absent: Stacie Frerichs, Rebecca Hager, Kevin Wolf


Staff Present: Eric Stromberg


Guests Present: Ya-nah Mandujah (arrived mid-meeting)

Roles:

Facilitator: Julie Cross

Time Keeper: Desmond Jolly

Notetaker: Nathan Milos

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).

Review Ground Rules: Nathan

Announcements:

Steve: My four year old had her birthday party here in the teaching kitchen. For those of you in the market for a child’s birthday party, let me recommend it.

Julie: We’re happy to do teenage parties; we’re happy to do adult parties.

Steve: The other announcement I have, is that I was talking to Jeff on the audit task force. He has a daughter with development disabilities; she’ll be working here. I was proud that the Co-op was going to be working with her.

Dina: The Pumpkin soup is delicious.

Q&A:

Sam: If this is suitable for Q&A – if it’s not a private matter – have we noticed any impact from Trader Joe’s?

Eric: We’re down about 13%; we had a really good Thanksgiving week: we were only down 6%. The funny thing, our wine department is the least affected. Our frozen department is also only down a small amount. Our Deli is up about 20%. Bulk, cheese, dairy, and produce are all down the most. We’ve heard that Trader Joe’s sources its produce from everywhere, ships it to Monrovia to be packaged, and ships it back. Students make up the bulk of the faces in the Trader Joe’s.

Steve: How are our basket sizes?

Eric: They aren’t down; it’s customer count. The other thing that hurt us was that after the Co-Ho – the student coffee house at the Memorial Union – reopened they added sushi, and our sushi sales declined. The hole in the wall is being cut tonight.

Desmond: Is it advisable to have, say, Kenna do a simulation of the decline of sales?

Eric: We’ve already done that; we just have to decide if this lasts more than a few weeks, what we will cut. If we ask employees to pay a portion of their healthcare, we have to do it in December.

Sam: Anecdotally, I just received word from Kaiser that my premiums are going up?

Eric: We actually went down this year. We received a discount by switching providers.

Janie: What is the big metal thing that was installed?

Eric: It’s intended for charcoal and firewood. It didn’t arrive at the specs that Beth requested.

Steve: I remember that when we were waiting for Trader Joe’s that we discussed how other grocer’s had experiences a big drop, and then at year end…

Eric: …they were back to zero.

Agenda Review

Amend Agenda

Janie: If you have comments on BGM 3, send them via email. 4.1, 4.8, and 4.9 are postponed to January.

Steve moves to adopt agenda as amended

Sam Seconds

Passes unanimously

4.2 Global GP ‐ 2nd Reading

Discussion:

Julie: Stacie sent this out by email and not by hard copy. I don’t have any problem postponing Global GP, but I would like to discuss the bylaw issue. If anyone wants to make comments on Global GP, do so via email.

4.3 Bylaw Survey Results and Discussion

Discussion: Julie: This will be moved to after the break.

4.4 GP3 ‐ Agenda Planning

Discussion: Julie: Compliance is reported and no changes are recommended for this item.

Motion: Janie moves to accept the monitoring report

Seconded Desmond

Motion carried unanimously

4.7 Form Annual Meeting Task Force

Discussion:

Julie: I move that we nominate Stacie to chair the task force. If she doesn’t want to, we can reevaluate.

Motion: Steve moves to charter annual task force with Stacie as lead

Seconded Desmond

Motion carried unanimously

4.8 Form Nominating & Election Task Force

Discussion:

Janie: The date is wrong; it should say 2011.

Motion: Julie moves to charter task force with a change of the year to “2011” and with Janie as lead.

Seconded Dina

Motion carried unanimously

Steve: I encourage new members to serve on the task force.

4.9 Election Calendar Proposal

Discussion:

Julie: we need to adopt an election calendar to set the whole process in motion. It’s something that can be amended later, but it does make some things hard and fast.

Janie: Do we have to adopt it?

Julie: Yes.

Motion: Sam moves to accept calendar

Seconded Steve

Motion carried unanimously

5.1 Upcoming Board Linkage Opportunities/Events

Discussion:

Julie: Linkage last month was the very first Local for the Holidays in Central Park; it was beautiful and did not rain. This month the linkage event is the Holiday Meal. In January – the first Saturday – we are having an in store Resolution event with booths, etc. Any Sunday from 1 to 5, we generally see 200 plus people; if we advertise, we can get 300.

Sam: Local for the Holidays was a very foodie event. It was well attended. I’m not somebody who does a lot of cooking at home, but people seemed to enjoy it.

Dina: Jaymes did a cream puff with squash and beets.

Julie: Did either of you talk to any members?

Sam: I talked to a few; everyone had a good time.

[Janie gave a report on a dinner with David Thompson.]

3.2 Website budget proposal

Discussion:

Janie: I left this in folders. [Janie reads her proposal.] We could reduce our retreat budget $1000.

Sam: I’d like to thank you for doing the legwork, and Julie for finding a financial solution.

Julie: I do have concerns on spending money on anything right now, and wonder if it might be better to postpone a decision until January.

Steve: Do we have these skills in house?

Julie: No.

Steve: I think the cost you’re proposing is pretty mild.

Janie: I could ask for just the $450.

Sam: Does the offset with the reduced retreat money satisfy you Julie?

Julie: I’m nervous about spending.

Eric: I was going to recommend, “No.” But that’s so inexpensive per hour, I think it’s a good idea.

Desmond: If this is an accommodation within the budget, I think it’s probably money well spent. This almost seems like a steal.

Dina: It would be good if you could also add weblinks and a chatroom. UC Davis uses a similar website called Smartsite.

Julie: Let’s make a motion to reallocate $1000 from the retreat budget to the board website budget and give Janie the authority to spend it.

Desmond: I so move.

Julie seconds

Motion carried unanimously

Sam: Can we discuss what reducing the retreat budget means?

Julie: I don’t think we will be hiring an outside facilitator. Our budget covers a facilitator and food.

Consent Calendar


Presented: Consent Calendar Items

Motion: Sam moves to adopt the consent calendar as amended

Desmond seconds

Vote: Motion is adopted unanimously.

Break: 8:00 Reconvene: 8:16

4.3 Bylaw Survey Results and Discussion

Julie: Our goal for the December board meeting is to further our discussion about an initiative to be placed on the April ballot. Does anyone disagree that a good starting place is “We should have one proposal or multiple proposals?”

Desmond: I think we should give members choices. Not necessarily four, but more than one.

Janie: I think we should give them one choice. We’ll get so few votes that the option that wins won’t carry much weight.

Sam: I think we should make this as simple as possible, by asking our members to ratify what we’ve decided. So the binary – yes or no – is a good idea.

Dina: I was surprised by the survey results.

Steve: Echoing what Janie just said, I think that speaks to one choice and you can vote for or against it.

Julie: While I would like to live in a world where we could say to our members, “Here is our range of choices.” I don’t think we have their attention that long, so I’m in favor of a binary.

Teddy: I like the single choice.

Julie: We’ve come to an agreement and are moving forward to determine what the binary choice will be.

Dina: Whether or not I’m in favor of having a binary choice depends on the binary.

Julie: I’m in favor of the intermediate option. Option 1 is restrictive, giving members the rules they have under California law; Option 2 offers an intermediate option: 5% of member signatures with particular wording regarding boycotts; option 3 is the status quo with the “proper purpose” language; option four is imaginary and has not been drafted.

Steve: I was a little confused: how is option 1 different from what we have now.

Julie: It’s more restrictive.

Steve: 2 is not quite what we have now?

Dina: The restrictive option does not allow boycotts?

Julie: Correct.

Janie: I would pick the intermediate option because it’s our job to protect the Co-op.

Teddy: Just to clarify, our lawful and proper purpose resolution would remain a precedent.

Julie: A future board could amend that.

Sam: I like the idea of flexibility for unforeseen evens. I’m very invested in our current policy. Even though we may think that people favor more restrictive boycotts, to restrict the choice to that or this disenfranchises to a certain extent those who have a different interpretation entirely. I’d be interested in a raw data count regarding whether members agreed or disagreed. If people like what we’ve done, we can go out and seek what our members want and tailor it to where they’d like to go. If I were to think of a choice, I’d propose the choices you, Julie, have proposed (intermediate option).

Janie: My main concern is how many hundreds of hours we’ve already spent on this.

Julie: If our ballot said, here is our current bylaw and here is how the current board has interpreted lawful and proper, that would allow people to ratify our resolution.

Janie: If Kevin were here, he would be saying that we need to have definitions of legal and proper in the intermediate option.

Sam: While there is a natural desire for people to get clarification on what we mean by lawful and proper, it is so complex and case specific that to do so is an illusion. The very act of doing so deprives us of the flexibility that is the beauty of those words lawful and proper.

Steve: Kevin’s going to want a definition and I don’t think we can do that, because we don’t know what we’ll be faced with. I think with the intermediate option, the board is restricted. I’m comfortable having people choose between intermediate and the status quo.

Desmond: I was happy with voting for the “lawful and proper” definition that we voted on in the last case, but I’m not comfortable fixing it. I don’t think every word we put down last time would apply forever and ever. It would create an illusion of specificity regarding the meaning of “lawful and proper.”

[Julie rereads the intermediate option.]

Dina: The intermediate option does eliminate the economic actor of a boycott against a state.

Julie: They could amend the bylaw.

Desmond: If the corporation had a specific tie to the state, they could still probably make that fit.

Julie: There was some debate following section A, there are sections B through D, which apply to any option.

Teddy: So I guess, on the one hand I can understand wanting to put a definition out there so as not to appear arbitrary, but I understand the need for flexibility. I don’t want people to come back and say, “Well, they hate us; that’s why they didn’t approve that boycott?” Something in place to give people some kind of idea – a precedent for actions.

Sam: This is a very complex subject. There is a body that hears a lot of cases like this – the Securities and Exchange Commission. Most of the activists they hear from have learned from reading previous cases how to go about procedurally to get their proposals looked favorably upon. They go about doing it by requesting, for example, a board for a human rights committee look into a claim in a way that is not so patently offensive to the proper sphere of management – of what a management is for: to make certain day to day decisions. At any rate, the SEC - and its not fixed; it has changed – the SEC has seemingly contradicted itself at times. What I think we should do is anticipate that in the future we might meet with a more professional and better organized group than we have met in the past. What we have to be thinking about is these kinds of requests and how we’ll deal with them – that we’ll form committees to look into these. What is a proper management plan, and what is fair for members to intervene in and when. I think it’s quite unusual to have a boycott policy, but we want to think about the issue of if we want to put a ribbon on this package, we want to inform ourselves about how they do things in the corporate world. And how we handle this is something more like a professional response.

Motion: Julie moves to have Babak draft an initiative offering the intermediate option.

Janie seconds.

Substitute Motion: Sam moves that we direct Babak to draft language of a proposition to our membership to ratify the actions we took in the resolution on the BDS.

Desmond: My problem with it is, that to be retrospective – to go back and rehash that stuff, wouldn’t make me happy. Let’s be prospective and move forward.

Substitute Motion: Dina moves to have Babak draft a motion offering only the clean up language.

Steve Seconds

Steve: so we would have two proposals on the ballot 1) a change or not of lawful and proper, or 2) just clean up.

Julie: you’re saying you just want to do clean up.

Sam: It’s darn hard to see without it being written out exactly what you’re proposing. Do I infer from that you’re trying to clear up how many days members have for petitions, but not saying anything about lawful and proper.

Dina: That was my understanding of the consensus from the last meeting. I didn’t want to take away options from our members.

Julie: I was calling on myself to say my concern is that the language we do have currently isn’t adequate. It allows too broad a scope for our membership to bring petitions. I think it’s our job to somewhat narrow that. It’s our duty to say our members have rights and to lay them out.

Dina: My feeling was that I know the board put in a lot of work, and I think that precedent can be a reference point for how you deal with future issues.

Sam: I’d like to hear what Eric thinks.

Eric: I would go with the intermediate option. I agree with Julie that it’s your job to spell out to the members what are your rights.

Sam: A lot of corporate law deals with what’s appropriate. So, I agree with what you say. The law does side with management in terms of running a business. I don’t think you have to spell it out; I think it’s already spelled out. I’m not in favor of the intermediate option. I’m in favor of the status quo or even Dina’s option. If we do approve what Dina is proposing, by neglecting to discuss anything at the bylaw level – any ratification of what we’ve done, does it weaken what we’ve done?

The vote is called on Dina’s substitute motion

In Favor: Dina, Frank, Steve, Desmond, and Sam

Opposed: Teddy, Janie, and Julie

The motion carries; the prior motions are superseded and no vote is called

Desmond: When the other members come, they’ll have a voice?

Julie: They will have a voice, but we will not have this discussion again.

3.3 Group Reading ‐ Organic Foods

Julie: Eric wanted to talk to us about full share memberships.

Eric: Every year about this time of year, we send out $20 dollar gift certificates. I think it’s worth it because its stimulus money. When you have a new competitor, you have to act within weeks and not months.

Desmond: Do you think it would be a big difference to offer $10 instead of $20?

Steve: I think that $20 dollars is a gift.

Julie: People bring that $20 dollars in and buy a gift or a book, not just groceries.

Steve: I think it’s a great thing to remind people that the Co-op is special.

Sam: Offering a percentage might be interesting?

Julie: I want to commend Eric, because it takes bravery to spend money in a tough economy.

Sam: I’m comfortable with whatever you decide.

Steve: I like the idea of an 11% coupon every once in awhile.

Julie: The original 11% sale was in honor of the 11th anniversary of buying the building.

Sam: As long as it’s within our margins, it might be worthwhile to allow members to get a percentage off one item.

Meeting Evaluation

What Went Well?

Upgrades

Next Meeting –

Facilitator: Julie

Time Keeper: Frank

Recorder: Nathan

There being no further business to come before the meeting, it was adjourned at 9:21 p.m. by a motion made by Dina, seconded by Steve, and passed unanimously.



/s/ Julie Cross, Secretary


__________________________________ ______________________

Secretary, Davis Food Cooperative, Inc. Date Approved


Approved – January 24, 2011