Conference 7.286::dcu

    One of the boards I serve on also has a 2-year term limit.  I enjoy
    serving, but I'll be glad when it's over, too.  Another board has no
    such limit but rotation still works out to about 3 to 5 years normally.
    I like the limits because they mean there's a light at the end of the
    tunnel.  :)
    
    Steve

Several states have had referendums on term limitations for legislators, congress
critters, and the like.  In general, the notion of term limitations is something
which is gaining in popularity.

In general, I support the notion of some sort of term limitation for BoD members.
I feel it's important to structure this properly so that the entire BoD doesn't
roll over simultaneously in a way which makes all incumbents ineligible (the idea
being that in a "good" board, some gradual transition is more beneficial than
radical transition).

It's my opinion that someone who has had MAX_TERMS on the board should have the
opportunity to come on again after some waiting period.  Unlike a legislator or
congress person, DCU BoD is not paid.  So, there is little monetary benefit to
be gained.  So I feel that if someone has two terms and goes off, they should be
able to run again (either by nominating committee or petition) after some number
of years (like 3).

/Chris

I also think term limiting is an excellent idea. It insures against
the board losing touch with the members (like what happened at DCU).
I myself probably would not run for a second term if elected.

    This note is just the latest of several that seem to confuse credit
    union directorship with local government.  Hold it!  Let's remember
    that DCU is first a business, a financial institution.  The
    directorship is somewhat more democratically determined than in other
    businesses, but that's all.  The analogy to government just does not
    hold water.
    
    I would expect the DCU board's actions to be overwhelmingly
    non-controversial.  I would also expect election of mostly new
    directors to be a correction to things going badly awry, which is the
    corporate model.  The process is working, as we all can plainly see.
    
    I predict that the new board will be quite capable of correcting its
    own errors.
    
    Wes

	I oppose the concept and practice of term limitation, be it in 
	the public or private sector.

	Such limitations take away my right to choose. A right I guard most
	carefully.


Jim

.4:  "Let's remember that DCU is first a business, a financial institution."

I don't agree.  It is first a cooperative, and after that a business.
As a business, it is run by well paid professionals.  Their actions are
watched over by a Board whose job is to make sure that the business stays
firmly focussed on doing what is best for the members of the cooperative.

This is not, I think, quite the same as the job of a normal corporate Board.
However, it is quite like the role a School Committee plays.  The School
Committee sets policy and oversees the actions of the professionals who 
actually run the school, and exists so that the parents and townspeople
retain strong, though indirect, control over what happens in the schools.


.5:  "[Term] limitations take away my right to choose."

I agree they aren't the best alternative.  But when the same old people
can't be pried loose from office until some massive scandal comes to light
(and not always then), then I consider that THAT takes away my own right to
choose.  The incumbents have incredible power to freeze out challengers --
that is demonstrated by the high re-election rate in congress and in the
DCU Board of Directors.

I feel that the playing field has to be balanced somehow, or else all of
our choices come down, in practice, to choosing the incumbent or choosing
not to vote.  I'd love a better alternative than term limits, and I'd be
happy to listen to your suggestions.

	Enjoy,
	Larry

A CPA once told me that *ALL* bank employees are *REQUIRED* to take a 
2 week vacation every year.  A terrible reduction of their right to 
choose their working hours!  :-)  It has a practical purpose, though.  

According to this CPA, there used to be an awful lot of cases where
everyone was surprized when the most dedicated employee in the bank
turned out to have been embezzling money for years!  Having taken
(and lost) the money, these people had no choice but to be dedicated,
because they had to be there every day to keep the evidence hidden.

Therefore, he told me, laws were passed requiring periodic vacations
for bank employees, on the grounds that 2 weeks enforced leave provides 
an opportunity for any potential problems to come to light.

I'd support an "N on, 1 off" type of term limit, in which Board members
can serve for a certain number of terms and then must take a one term
"vacation".  That could serve the same useful purpose, without preventing
anyone from returning to the Board (if the electorate chooses to take
them back).  I believe that incumbents, or those appointed to fill the 
roles of departed incumbents, won most or all of the BoD elections over 
the past 7 years.  Would the result be different today if there had been 
some elected newcomers periodically joining the Board?

	Enjoy,
	Larry

re:  Previous comments about DCU as a business, and not government.

I will concede that DCU should be more like a business, and less like
a government, but the cooperative philosophy which seems to run 
through the enabling legislation says to me that a credit union has
attributes that describe neither a business or government.  Larry has
used the word "cooperative" and that describes a credit union in very
precise terms.  The term "business" describes something which is 
for-profit.  While a credit union must be operated in a businesslike
fashion, I don't feel that all the connotations of a business apply.

I believe that one of the things that led to troubles within DCU is
a distinct sense of complacency.  People sat on the Board for extended
periods of time.  Without periodic infusions of fresh blood, there is
no one to say "what's going on?" to a particular practice.  In an
environment such as that, even the most far-fetched ideas can take on
a life of there own over time.

I support Larry's notion of N-on, 1-off.  

./Chris

    
    N-on/1-off sounds good.
    
    On the other hand, this sounds like treating a symptom. Perhaps if we
    elect directors who will put the process of bylaw change back in the
    hands of the members, make minutes available to members whenever
    possible, in general become more open about how they direct the credit
    union, and therefore stand for reelections on issues and records rather
    than solely on incumbancy, we wouldn't need artificial term
    limitations.
    

    I'm generally opposed to the concept of term limitations; it seems to
    me that it attempts to fix a problem that shouldn't exist in the first
    place.  We, the voters, are in charge (or are supposed to be).  If
    somebody isn't good, vote them out!  If somebody is good, keep voting
    them in.  If somebody undesirable remains, it's our fault.  Term
    limitations seems to me to be a kludgy way to compensate for voter
    apathy.
    That being said...there is the "power of the incumbancy" to deal with.
    It's a lot easier to get reelected than it is to get elected the first
    time.  Perhaps we could solve *that* problem by putting the names of
    all candidates in strict alphabetical order with no notation of
    "incumbant" on the ballot.
    Of course, this year may be different (I hope).  In the past, I have
    voted for incumbants because I thought all was sunshine and light in
    the world of DCU and things were humming along in good shape, so why
    change?  That's certinaly not my point of view this year!  I expect a 
    lot of other people may have a changed attitude as well.  The notation 
    "incumbant" may be more a curse than a benefit.

Re: .10
I think you've hit the nail on the head. Not only is the title of
incumbent usually an advantage, the incumbents have all the power of
DCU and their advertising backing them up, not to mention endorsements
of the officers of Digital backing the status quo. Most people (including
myself) would not scratch thru all that support to find out the truth.
Limiting terms would at least force new faces in, tho they could effectively
be the same as the old faces.

	Ok, I've finally felt that I've pondered this topic long enough to
enter a reply.  This delay was caused by me seeing valid points on both sides
of the term limitations issue and trying to figure out a way that "works"
and yet avoids some potential abuses.  My proposal is this:

	1) No board member can serve consecutive terms.

	2) No person may be elected to the board, or appointed to the board,
	   within 330 days of that person having been a board member.

	The first part of the proposal is rather self-explainatory.  The second
part stops some potential loopholes that could be used to get around the first
part.  For examples:

	A)  A board member decides to "resign" a month before the elections
so that, technically, they are not an incumbant seeking reelection to their
board seat.

	B)  A person seeks, and gets elected to, a board seat for the express
purpose of then resigning to allow the remaining board members to reappoint
a board member whose term just expired.  (Or, to lower the paranoia level,
the new board member resigns for "legit" reasons but yet the board decides
to reappoint a recent board member.)

So why didn't I just say "within 1 year" in the second point?  That could be
abused in the opposite direction of a board trying to keep someone from
being able to run for office.  For ease of scheduling, most by-laws specify
a narrow range of dates instead of a single date on which the annual meeting
must be held.  Lets say the by-laws say (hypothetical, I don't know the DCU
bylaws in this respect) that the annual meeting must be held sometime in the
first two weeks of April.  Lets say that the annual meeting for 1996 is held
on April 12th and a board member whose term has expired decides to rerun in
the next election.  The remaining board members don't like him/her, so they
schedule the 1997 annual meeting for April 10th so that technically this
person hasn't been off the board for "1 year".  Technical pickyness, yes,
but its things like this that keeps the lawyers' mortgages paid... :-)
Setting a range of dates in which the annual meeting can occur and setting
the "can't be a board member again" figures right guarantee that someone can't
be pushed out an additional year by the "fun and games" department.

	Incidently, one of the attributes of this one-term-on, one-year-off
approach is that a board member that the membership really loved could still
serve most of the time.  The terms are for 3 years (under normal circumstances)
and thus making them wait 330 days (ie. a year ;-) before being reelected lets 
them serve an average of 75% of the time.  That's a pretty high potential
service percentage compared to other term limitation plans that, at best,
give the person 50% (ie. some of the congressional term limit plans)) or, at
worst, just a single term in office.

								-craig

re: .12, "No board member can serve consecutive terms"

I think it's important to allow a board member to be able to
serve multiple terms from the standpoint of preserving continuity
on the board.  If the board rolls over completely every couple
years, it may lead to a significant amount of overhead in terms
of the board is always "ramping up" on the issues.

I would support a notion of a two term limitation, followed by
some waiting period before the individual can be on the board 
again.

/chris

	Re: .13

	Since the terms of office are three years and 1/3rd of the board comes
due for election at each annual meeting (ie. staggered terms), the board's
continuity is preserved since 2/3rds of the board members will still be there
after the annual meeting.

							-craig

I disagree with .13's assertion that:

>I think it's important to allow a board member to be able to
>serve multiple terms from the standpoint of preserving continuity
>on the board.  If the board rolls over completely every couple
>years, ...

No more than 3 board members are going to be elected in a given election.
(Barring special meetings, etc. :^)  So continuity is preserved in that
we have at least 4 board members serving from one year to the next.

Similarly, it takes 3 elections for the board to "roll over completely."

This does not seem like a big continuity problem.  If it feels right to
put an experienced person back onto the board, the membership need only
wait until the next election.  Until then, at least 2 board members have
been serving for 2 years and 4 or 5 have been serving for a year or more.

I believe Craig's proposal is a very good attempt to provide "term limits"
without providing "limitation of service time."  If DCU members feel that
some sort of "term limit" is needed, then I think this proposal has merit.

K.

    
    RE: .0
    
    I believe I was the person who originally proposed limiting the terms
    of Directors (back in note 8 and a couple of other notes since then).
    
    There are many good reasons for limiting terms IMO.  And very few
    against, provided the length of service allowed is sufficient for a
    Director to try and achieve whatever their goals as a Director.  I do
    not think that limiting a Directorship to 6 years (2 consecutive terms)
    and mandating a 1 term (currently 3 years) sabattical is limiting the
    memberships choices.  To think that way, says there aren't enough good,
    qualified and interested members willing to serve.  I don't believe
    that for a moment and I think the turnout this year (43 applicants)
    proves it.  Whatever the method adopted (if any) it must be kept
    SIMPLE.
    
    Let's face it, incumbancy in ANY organization is a huge, no, almost
    insurmountable mountain to climb.  And especially at DCU where you have
    the Nominating Comm. actually endorsing the people they select and DCU
    sending literature with just their names, not to mention the recorded
    message (when I WANT to get put on hold I can't!).  Then the Nominating
    Comm. reviews petition candidate material (as yet untested waters) and
    who knows what will happen there.  And then you have a fairly large
    uninformed (and in some cases, mis-informed) membership who know
    NOTHING of what has transpired at DCU.  And THEN you have members who
    will simply always vote for anybody marked "INCUMBENT".  The fact that
    2 Directors have choicen to actually run in this election in spite of
    all that has happened tells me a LOT about how valuable incumbency is. 
    Make NO MISTAKE ABOUT IT, any challenger (and especially petition
    candidate) is going to have a tough road to winning a position on the
    Board.
    
    Now the advantages I see to term limitations are:
    
    	1. A system which has a built-in ability to provide a means of
    	   injecting fresh energy and ideas into the credit union.
    
    	2. Directors who will see that they don't have a lock on a position
    	   and may be more motivated to perform their duties or push for
    	   the changes they wish to make. 
    
    	3. While friendships are nice, I believe extended periods of service 
    	   as a Director transform what should be a business relationship
    	   into a personal friendship.  Now if everything is fine, there is
    	   no problem.  But as an example, if one of these people get the
    	   idea to abuse the trust placed in him by his "friends",
    	   something very bad could happen, like the loss of $15 million. 
    	   And when a friend is sued and his assets frozen, all you may
    	   wish to do is ask him if everything is OK, instead of looking 
    	   closer.  Friendships must never be allowed to interfere with or
    	   supercede a Directors responsibility to the membership.  
    
    	4. Allowing the regular influx of new people will also broaden the
    	   pool of available, experience people also.  Former Board members
    	   will be able to re-run after sitting out for a term.
    
    	5. Gets the Directors back among the unwashed membership and in
    	   touch with the way DCU functions to a regular member.  The view from
    	   the top of the mountain is always different than the view from the
    	   forest.
    
    While the membership choices may be less 1 or 2 people for a few
    elections, I see many more advantages to term limitations.  As a
    candidate, I personally guarantee that I will serve no more than 2
    consecutive terms if elected.  I will serve only one term if I feel DCU
    is back on the right track after 1 term.  I am not a professional
    politician or one who seeks office for status.  I see a job that needs
    to be done and I am willing to help in any way I can.  Right now that
    means running as a petiton candidate for the Board.
    

    I also believe a two-term limit is reasonable, though I wouldn't force
    the incumbant to wait for a full term before regaining eligibility.
    
    When writing up such a term limit, please consider the fact that many
    volunteer Boards of Directors are significantly LESS stable than the
    DCU BoD has been in recent years.  It is VERY common for a director to
    serve a year or two and then resign, having discovered that they can't
    afford the time required.  That creates a replacement vacancy for the
    remainder of their term.
    
    Limiting directors to "two terms" means they can each serve for 4-6
    years; limiting them to "two full terms" means they can serve for up to
    8 years; limiting them to "6 years" means either the same as "two
    terms" or that they resign in the midst of their third term.
    
    One year off should be sufficient in any event.  I think the likelihood
    of a directory coming back after a year is considerably less than
    simply running for another term.  It's possible to keep a an ON 6/OFF 1
    cycle going with ten directors, but it's quite a bit harder to do than
    the multi-term entrenchment we've seen at DCU.  (While the dominant
    members are OFF, the BoD dynamics change and make it harder for them to
    run the show when they return.)

    I agree with Jim Percival.  Don't blame the system, blame your fellow
    voters if you feel incumbants have an unfair advantage.  Don't put
    artificial constraints on democracy.  With majority rule someone is
    always going to feel slighted, but you can't please everyone all of the
    time.

    
    RE: .18
    
    When "the system" isn't weighted so heavily in favor of incumbents, then
    "artificial constraints" won't be necessary.  Term limits allow a
    relatively level playing field to happen with a reasonable frequency. 
    "The system" would be open and level, all non-incumbents running.
    
    The current situation, where DCU and the BoD control all communications 
    with DCU members, doesn't allow any information out which may be
    damaging to them, no matter how true it is or how much the membership
    has a right to know.  There is a virtual strangle hold on information
    and its dissemination.  This is just one of the mountains that must be
    scaled.  I could list many more but I think everybody already knows
    them.
    
    A system which primarily serves the needs of the incumbents has
    emerged.  I think may feel the system should primarily serve the
    membership at large and DCU.

    Ah, but it's not just the incumbents who have a heavy advantage.  It's
    also the Nomination Committee choices.  That's because, like it or not,
    what usually wins elections is NAME RECOGNITION.  Even the previously
    unknown Nomination Committee choices have already gotten their names
    onto the by-law-mandated mailing that went out some time ago to all DCU
    shareholders.  Their names are in shareholders' hands right now.  Most
    shareholders that read information that comes from the DCU have read
    these names and may be more familiar with them than they will be with
    any of the names of petition candidates.
    
    Now, DCU is not forthcoming with any sort of mailing list to the
    petition candidates.  Even then, guess who foots the bill to get a
    mailing out?  Each mailing costs, what, over $20K?  That's at least
    $20K+ advantage that goes to incumbents and Nomination Committee
    selections versus what goes to petition candidates.  Now, how is anyone
    going to beat that?  
    
    If you don't like the distances being placed between shareholders and
    their Credit Union (which distances are apparently widening as the by-laws 
    du jour seem to indicate) then there need to be some changes made.  I'm in 
    favor of term limits if only to reverse the current trend of intentionally
    limiting shareholder influence.
    
    Same goes for politics, but that's another issue ...
    
    Steve

    
    RE: .20
    
    Not to mention the recorded message at DCU.  When the petitions are
    validated, I intend to push to get petition candidates added to that
    message or have it removed.  Publicity and communication with the
    membership should not be restricted to a select group of candidates
    hand-picked, in part, by the DCU employee (Cockburn) who controls
    the message.
    

    Also re: .20
    
    A heavy advantage?  How heavy do you believe it to be?  I really doubt
    that there's much name recognition for either the incumbent candidates
    or the nominees.  Please remember that the vast majority of the credit
    union members did not take part in the Special Meeting, do not call and
    listen to the recorded phone message, or even read this notes
    conference.
    
    I am just dying to see how the new board members feel about these
    proposed changes.  Maybe when the shoe is on the other foot...
    
    Mark

If the way I used to think and vote in the past is any indication,
the nominated candidates have quite an edge.

When I received a past DCU ballot, I read through the material
and thought about who should get my votes.  I immediately gravitated
towards Mark Steinkrauss as he had years of experience as a bank
examiner and is in charge of investor relations for DEC.  These seemed
like good things.  I looked at other incumbants who were running and
made yea/nay decisions about them based on their credentials.  When
I had finished looking at incumbants, I next looked at nominated 
candidates, choosing a few who looked good.  I thought of nominated
candidates as being special as they were chosen by a committe whom 
I believed was representative of the membership of the credit union.
Lastly, I had one vote left and I looked at the petition candidates.
My first thought was that these are a bunch of ya-hoos who are running
because they're sore over being passed over by the nominating
committee.  I looked them over and went back and voted for another
nominated candidate instead.

Being named by a nominating committee carries a lot of weight.  The
purpose of a nominating committee, in my mind, is to help qualify
candidates and present a reasonable slate to the electorate.  People
who don't know much about DCU (and that included me a couple years
ago) tend to make presumptions about the quality of the candidate based
on whether it says "incumbant," "nominated candidate," or "candidate
by petition." 

I know people take time to read these things over in some cases.  I 
know that everyone is smart enough to render their own independent 
decisions based on credentials.  But I used to let the blessing of the
nominating committee impact my decision-making.  I'd be surprised if
I'm the only one who made decisions this way.

/Chris

    re: .22
    
    How heavy do I believe it to be?  Well, during the petition drives we
    reached about 2000 people each.  Let's assume that we met different
    people with each drive.  So, we reached 4000 people.  Let's double that
    to account for people that have read notes or e-mail about the petition
    candidates.  So, 8000.  That's only about 10% of the shareholders that
    have had opportunity to read the names of the petition candidates.  
    
    On the other hand, 100% of the shareholders have had a chance to read
    the names of the Nomination Committee choices.  So, how heavy? 
    Probably on the order of 10 to 1.  Granted, not all of the folks have
    actually read the names.  But, not all of the folks that signed
    petition papers can remember the names of all the papers they signed,
    either.  Even so, the opportunity for exposure has been a lot higher 
    for the Nomination Committee candidates, even excluding the free promos 
    they are getting from DCUs phone lines.
    
    I rather expect high-level endorsements of the Nomination Committee 
    candidates to be circulated in e-mail and on VTX.  Upon close scrutiny
    they won't exactly be endorsements, but they will have the same
    intended effect.  Just as they did before the Special Meeting.  That'll 
    probably tip the scales a tad, too.  We have to remember, it's on
    hardly anyone's agenda to give the petition candidates a "fair shot" at 
    BoD seats.  It's pretty much accepted that they need to work under
    handicap, having already been rejected by the Nominating Committee.
    
    Steve

    I've followed this conference for several months.  Being sensitized to
    the issue, I carefully read the DCU blurb that listed the officially
    nominated candidates.  Except for the incumbents, I don't remember
    their names.
    
    I doubt that many members will do better on the names than I did.

    
    I spoke with Patty D. yesterday.  She said DCU wouldn't be sending out
    the names of the petition candidates to the membership (I know, but I had
    to ask) other than on the ballot.  She also said that petition
    candidate names wouldn't be added to the recorded message at DCU. 
    Meanwhile they won't grant access to the mailing list at reasonable
    costs.  Is it my imagination, or is this playing field tilting a tad more?
    

  RE: .26 

  >  She also said that petition
  >  candidate names wouldn't be added to the recorded message at DCU. 


    Phil, after the petition signatures are validated, could I suggest that
    all of the petition candidates write a letter to DCU to formally request
    that their names be added to the tape recording of candidate names? Let
    the DCU refuse the request in writing. A complaint to the NCUA might also
    be in order.

    I don't think that the recording per se will make that much difference.
    However, I do think that the principle, and the precedent, is important.
    Is DCU allowed to partake in the election process by openly favoring
    some candidates over others?  This is nothing short of electioneering
    on their part. Geesh, talk about subliminal programming of the electorate!

    If their decision on the tape recording is allowed to stand unchallenged,
    then we can expect to see (as someone else has suggested) additional
    actions on behalf of the nominated candidates. The nomination itself is
    enough of an advantage. Any further attempts to tilt the field as you
    put it should be brought to the attention of the NCUA, for the record if
    nothing else.

    As members of DCU, we deserve as fair an election process as is possible
    under the circumstances. And in my opinion that does not include tolerating
    openly biased actions such as the tape recording by DCU on behalf of the
    nominated candidates.

    Jim

  <<< Note 460.26 by GUFFAW::GRANSEWICZ "Vote for DCU Petition Candidates" >>>

    
>Is it my imagination, or is this playing field tilting a tad more?
 
	Phil, It doesn't take much of an imagination to come to this 
	conclusion.

	I must admit that I am a bit suprised that the DCU would be this
	blatant in their attempts to "put in the fix".

	Then again, maybe nothing should suprise us anymore.

Jim

>Is it my imagination, or is this playing field tilting a tad more?
 
>>	Phil, It doesn't take much of an imagination to come to this 
>>	conclusion.

    	Yes, I was trying not to be too pessimistic or paranoid about 
    their (DCU) intentions and actions.  DCU and/or the BoD appear to 
    never have heard the phrase, "Do the right thing."  They blatantly
    disregard their own election guidelines which call for "disciplinary
    action" against any DCU employee participating in the election process. 
    The DCU Bylaws also appear to be meaningless to both the Board and the
    NCUA.  There is no penalty for violations.  They appear to be a one
    edged sword to use against others though.  For an institution whose
    primary asset is TRUST, they don't seem to understand how this type of
    thing undermines their status in the minds of the membership.  If a
    place or group can't be trusted with the little things (like running a
    fair election) then can they be trusted with the big things (like 
    protecting our money)?  It really makes me wonder what is going on at
    DCU HQ.
    

  <<< Note 460.30 by GUFFAW::GRANSEWICZ "Vote for DCU Petition Candidates" >>>

>If a
>    place or group can't be trusted with the little things (like running a
>    fair election) then can they be trusted with the big things (like 
>    protecting our money)?  

	That answer is simple, they can't.

	It's no secret that I've moved my business to another bank. I've
	left $5 in my Share account (and a few leftover bucks in checking)
	in order to vote in this election.

	It's unlikely that I'll move my business back even if a new BoD	
	is elected as it is a fair amount of hassle to do so. But before
	I pull completely out of the DCU I want to do my part to change 
	the current system.

Jim	

2 things:

First, ditto what .31 said.

Second, the Commonwealth of Virginia has what I find to be a very useful idea
w.r.t. term limitation written into its constitution.  Namely, the governor
may not stand for reelection.  Period.  He can run again after he's been away
for a term and may continue to do one on, one off for as long as the voters
can stand him.  BUT, he may not succeed himself.  Requiring a member of the
BoD to take one full year off before he can run again sounds like an excellent
idea to me.

-r

    Re: .-1
    
    Sort of like requiring bank employees to take their vacation?

RE: .-1

Yeah, something like that... ;-)