Conference 7.286::dcu

Before we have a special meeting again facilitating another reason to raise or
have fees (to pay for these meetings)... Didn't the new board put in place
a mechanism by which a "group" of disgruntled DCU members could get together
and request (force) a meeting with the board and/or DCU management to try and
come to a peaceful solution?

If (Phil) this was discussed during the meeting (fees) and (per se) it was hot
and heavy and very divided, why wasn't it requested to table the suggestion of
fees until the Board could hear from the membership?   It seems that many a
"discussion" was tabled in previous meetings...

In any case, I don't think it would be unreasonable to request such a meeting.
And it should be sooner than later, since we are in September and isn't this the
month that fees will hit?

Q: Does the DCU management still get a copy of notes placed in this notesfile
or was that stopped?

I am sure that if they do they will note that most of the "noise" comes from a
"small group" of people.  And that 5 or 10 people out of 60,000+ is a very
small percentage (as compared to 67% that don't have a relationship with the CU).
Of course that was the mistake last time.

  You are right we need to get a current set of the by-laws to find out
what are the current procedures.  I am not sure where things have been left
since the last board did their playing.

    
    Re: .0
    
   > 	1, What would have to happen/go wrong for you personally to believe
   >        it's time for another special meeting?
    
    I believe Chris Gillett is correct.  We passed a resolution making it
    clear that we don't want fees.  If they assess fees that is reason
    enough.
    
    
    >	2, What do you believe should be done to try and obviate the need
    > 	   for a special meeting which is costly to the whole DCU
    >       membership?
    
    I think it should be made clear to the BoD that we expect them
    to follow the resolutions passed at the special meeting and that
    this is NOT a negotiable item.  I hope they don't think the special
    meeting was a one-time flash in the pan.
    
    Steve
    

  It's obvious that all the board members agree with the gag order.  If they
didn't then what could be done to someone who violates it?  Impeach them?
I doubt that the penalty's can be that bad!

I originally posted this in 623, but it seems more appropriate 
here.  To add to the list of items in .0 (copied from 623.146):

    
>    for the next special meeting, we need
>    
>    o article for no fees
>    
>    o article that severly restricts exec sessions
>    
>    o access to board minutes directly after meeting
>      ok so there can be mistakes in minutes, but they can be corrected.
    
and, since i dislike being lied to:

     o recall of directors who voted for fees but ran on an 
       anti-fee platform.

>          -< Hmm  Board doesn't want to talk  Makes them all guilty! >-
>
>  It's obvious that all the board members agree with the gag order.  If they
>didn't then what could be done to someone who violates it?  Impeach them?
>I doubt that the penalty's can be that bad!
> 
I doubt they all agree with the board's apparent secrecy orders, but that
does not give any of them the right to violate it in a public forum like
notes.  Remember too that Paul Kinzleman does not have access to notes ...
but will reply post haste to e-mail.  That is why it is important to 
send mail and ask for an *individual* response ... you are then able to
determine whether your director is working for you.

re:  gag orders and such

If the Board takes an action in executive session, then the individual
members of the Board are bound to keep such activity confidential. 
The penalty for breaking such a confidence could be impeachment and
removal from the BoD, followed by civil litigation for breach of
fiduciary responsibility.  

While I'm sure that there are Board members who would prefer to speak
their peace - the cost of so doing may be tremendous.


DCU History Lesson #101:
------------------------

I have before me a flyer that many of us (myself included) circulated
during the Special Election.  It says, in part:

"The above "REAL CHOICES" candidates, all nominated by petition, are all
committed to the following goals and philosophies:

  * Restore membership confidence through more extensive, honest, and
    open communiation about what is happening at our credit union.  No
    more glossy brochures offering "more choices" to disguise fee increases.

  * Return power to the members by reviewing all recent bylaw changes and
    seeking membership approval for future bylaw changes.  Rescind the
    bylaw change that requires 5,000 signatures to call another special
    meeting.

  * Increase membership feedback into credit union operations and restore
    member involvement in advisory and oversight committees.  Recognize
    that most members are good credit risks and should be treated that way.

  * Improve the financial status of the DCU by focusing on long range 
    solutions intstead of short term fixes.  Focus on loaning money to
    members at good rates and try to hold the line of fee increases.

  * Review the lending and investment practices that led to the current
    state of the DCU, and report findings back to the membership.

  * In short, turn the DCU back in the successful credit union it once
    was.  We need a credit union that is committed to serving its members,
    not one that is committed to trying to imitate a commercial bank."


I was a Real Choices candidate.  And I put my name on this document along
with Tanya Dawkins, Lisa DeMauro-Ross, Phil Gransewicz, and Paul Kinzelman
(4 others also signed:  Abhijit Gupta, Gim Hom, Rich Luciano, and Alfred
Thompson).   I thought it was a pretty good platform on which to campaign,
and I thought it was a very good philosophy on which to base the management
of a financial cooperative like DCU.

I hope that Tanya, Lisa, Phil, and Paul will remember what they stood up
for when they attached their names to this document.  I hope that they will
not let us all down.

If you voted for Real Choices candidates who are currently on the Board,
I urge you to send them email and remind them of what they pledged back
when they needed your vote.  

Another petition drive, another special meeting, and another year of 
tearing apart our credit union would be tragic.  It was horribly expensive
for DCU, for the membership, and for the principals involved.  Many people
who were active in the process had their careers damaged as a result of 
the political manuevering within DCU and Digital.  The divide between DCU
employees, management, and membership was palpable.  I wouldn't wish the 
hassle of doing this on anybody.  But the Board of Directors should NOT
doubt our resolve - if it needs to be done, we will do it.  Those who do
not remember history are doomed to repeat it.

./chris

    
    Just got back from Toronto this morning.  Heck of a commute.
    Taking the 6:55am flight gets you to MKO by 9:30am!
    
    Let me say this about that.  I have said all I can say at this point in
    time.  I have asked for patience in this matter.  I will gladly respond
    to all your questions in due time.  (Might I suggest you combine all your
    questions to make it a bit easier for me?)
    
    All I can say is I am the same person, with the same beliefs, that ran
    for the Board 2 years ago.  But my position on the Board does, at
    times, require that I do things differently in certain instances.  This
    is one of them.  If I were serving on a one director board, I could 
    operate differently but that is not the reality of the situation.
    Please try to understand this.
    

I certainly understand, Phil, and am amazed that so
many appear to not understand.  This isn't the first
time and won't be the last time that you, because of
your position, are not in a position to actively discuss
what the Board has done or will do.

All of which is not to say that the membership should not
be speaking up and organizing if there is something (perhaps)
coming down the pike (fees) which we don't want.

Collis

�I certainly understand, Phil, and am amazed that so
�many appear to not understand.  This isn't the first
�time and won't be the last time that you, because of
�your position, are not in a position to actively discuss
�what the Board has done or will do.
    
    Sorry, but other board members have been crucified for this in the
    past.  The only difference is that Phil did bother to check in here and
    say that he couldn't say anything rather than wait for an official
    board or DCU memo to say that for him.

>>   Sorry, but other board members have been crucified for this in the
>>   past.  The only difference is that Phil did bother to check in here and
>>   say that he couldn't say anything rather than wait for an official
>>   board or DCU memo to say that for him.

There is another difference.  If you send mail to Phil with questions or
concerns, he will answer them, to the best of his ability.  The same is true of
Paul Kinzelman.  Other directors are just like the old board

Elaine

    
    	Thanks Collis, and I definitely agree with your second paragraph!
    

    
    RE: .11
    
    Keith, you simply refuse to read what I write.  I have stated I will
    answer all questions when I can.  You're attempts to compare me with
    the old directors are pretty cute though.  I get a laugh out of them...
    

Re:  .11

I'm sorry that you can't see the difference between
being very active and letting it be known that you may
not say anything about a particular issue at this time
and not communicating at all.

This is a difference and I see it quite clearly.

Collis

    I see the difference as well.  It's the "Spoonful of Sugar" approach.

    
    ME???!!! The "Spoonful of Sugar" approach???  Surely you jest Mr.
    Macneal!  Where are all the smiley faces and winkies???  You couldn't
    possibly be serious, could you?
    
    And to further prove my no-sugar approach, I will repeat my request
    that you answer note 623 on what you think a credit should be.  You
    stated you would when somebody explained this to you and somebody took
    time to explain it to you.  Now I think the least you could do would be
    to hold up your end of the deal.  Thanks, and looking forward to your
    answer.
    
                <<< SMAUG::USER$944:[NOTES$LIBRARY]DCU.NOTE;5 >>>
                                    -< DCU >-
================================================================================
Note 623.158        Relationship Banking and Fees for Service         158 of 189
PATE::MACNEAL "ruck `n' roll"                        10 lines   2-SEP-1993 16:43
--------------------------------------------------------------------------------
�    	But putting your two statements together would seem to indicate
�    that you think a bank has your best interests in mind, or maybe more so
�    than a credit union (dancing and singing aside of course).  Now I'm sure
�    that's not what you're saying or trying to say so why not help us all
�    out and spell it out?  Thanks in advance...
    
    When someone can explain to me what the differences between a bank and
    a CU are without all the warm and fuzzies, maybe I'll give it a shot. 
    There may have been a difference at one time, but the dividing line
    between the two is extremely blurry these days from what I can see.

�    ME???!!! The "Spoonful of Sugar" approach???  Surely you jest Mr.
�    Macneal!  Where are all the smiley faces and winkies???  You couldn't
�    possibly be serious, could you?
    
    No response or "I can't respond", the end result is still the same,
    isn't it.  We still don't have any answers and we still may have fees. 
    Some people seem to be satisfied with the "we're doing our best but our
    hands are tied" repeated a few times.  I'm not.  

    
    I know why you're upset that I won't respond at this time...
    
    
    
    You don't have anything to put in your sights as you driveby.
    
    And if you're going to quote me, please quote the entire statement and
    give a reference for it so I can check it.  Somehow my statements just
    seem to get mistated when you get a hold of them.  I wonder why?
    

    re .18:
    
    > Some people seem to be satisfied with the "we're doing our best but our
    > hands are tied" repeated a few times.  I'm not.
    
    So why are you giving heat to Phil?  Why not complain to the Board 
    members who aren't even talking, and who (apaprently) believe that
    fees are good?  Or are you calling them and sending them mail messages?
    I know it's not easy -- I did some of that during the campaign.  But if
    you want to accomplish something, that's the way to do it.  Anyway,
    please let us know what results you get.
    
    	Larry

�    So why are you giving heat to Phil?  Why not complain to the Board 
�    members who aren't even talking, and who (apaprently) believe that
�    fees are good?  
    
    Did I mention Phil's name anywhere?  Is Phil the only Director who
    reads this conference?
    
    Having said that, prior to the Election, Phil was one of those trying
    very hard to get Director participation and answers to member
    questions.  I assumed that he'd carry that over when he was elected to
    a seat on the Board.

    
.21>    Having said that, prior to the Election, Phil was one of those trying
.21>    very hard to get Director participation and answers to member
.21>    questions.  I assumed that he'd carry that over when he was elected to
.21>    a seat on the Board.
    
    Phil seems to have hs hands pretty serverly tied by rampant
    "executive sessions". Other than that, has he not delivered on his
    promise? Methinks aye.
    

>    Phil seems to have hs hands pretty serverly tied by rampant
>    "executive sessions". Other than that, has he not delivered on his
>    promise? Methinks aye.
        
        Agreed, and thanks, Phil!
        
        Y'know, this  is  beginning  to  smell  like  politicians in an
        average election -  tell  the  voters  whatever it takes to get
        elected and then...
        
        As for DCU employee bonuses - when the DCU owners start getting
        bonuses from Digital then that  might be a fair idea, but, when
        the remaining Digital employees are enjoying  up  to  two  year
        waits for review and perhaps a small  increase if you're lucky,
        then  establishment  of  user  fees  and  staff  bonuses    are
        ludicrous, in my opinion.
        
        Andy
        
    

    
    Re: .21
    
    > Having said that, prior to the Election, Phil was one of those trying
    > very hard to get Director participation and answers to member
    > questions.  I assumed that he'd carry that over when he was elected to
    > a seat on the Board.
    
    And he *has* carried that over.  He has responded and explain what he
    can comment and what he can't *and* given the reasons for that.  With
    that information you can go directly to the BoD and tell them you don't
    like if you wish.  In the past we couldn't even get that much.  Please,
    stop beating your drum of two years past.
    
    Steve
    

    
>        As for DCU employee bonuses - when the DCU owners start getting
>        bonuses from Digital then that  might be a fair idea, but, when
>        the remaining Digital employees are enjoying  up  to  two  year
>        waits for review and perhaps a small  increase if you're lucky,
>        then  establishment  of  user  fees  and  staff  bonuses    are
>        ludicrous, in my opinion.
    
    I agree that the fees sound like a bad idea. But let's not confuse
    DCU management with Digital management. DCU is showing a profit and
    generally doing well. Digital is not (excepting last quarter which
    may be a fluke as far as I can see so far.) While bonuses at Digital
    are not a good idea I don't see that they're ludicrous at DCU. Granted
    we should be seeing some benifit back to the members but I'm not ready
    to punish DCU staff for the screw ups of Digital management.
    
    			Alfred

    I agree wth Alfred.  If there are DCU employees doing an exemplary job
    then they should be rewarded.  It would be nice if the shareholders got
    a piece of the action too, though.

I think bonuses can be appropriate - but not when at the
expense of the owners who are not only not getting a
dividend but are threatened with fees in the future.

I always thought that dividends were paid first.  At
least, that's the way I believe it should be.  A general
policy of giving bonuses to every employee and giving
nothing to the owners/shareholders strikes me as
unreasonable.

Collis

    
    Re: .25
    
    > ... I'm not ready to punish DCU staff for the screw ups of
    > Digital management.
    
    Neither am I, but when the majority of customers/owners are either
    worried about their jobs or not getting raises then it doesn't sit
    well to think that fees are being instituted because the profit
    margin isn't enough to rebuild the ratio *and* offer bonuses.  Let
    them wait for the bonuses.  I'd have no problems with bonuses paid
    *after* the credit union operated as requested by the membership had
    rebuilt the ratio, but I have a *big* problem with bonuses being paid
    where the revenue  came from fees IN DIRECT DEFIANCE OF THE WISHES OF
    THE CUSTOMER/OWNNERS.  I would also want assurance that every DCU
    employee participated in the bonuses, not just management.
    
    Steve

DCU does not have to advertise (other than flyer)
DCU gets OEM prices on Digital HW and SW
DCU does not have to pay Federal Taxes
DCU does not have to pay State Taxes

Banks must pay all of the above 
Banks must show a PROFIT to their shareholders.

Banks are clearly not the competition as their cost structure is significantly
more on these basic items.  

I would like an explanation of why there is not more profit than is currently 
being made.  With the differences in cost structure the DCU should be head and 
shoulders above the banks assuming similar management and salaries and staffing 
etc.

I don't think the board (old or new) proposed the fees but I do think the same
DCU management did in both cases.

�A general
�policy of giving bonuses to every employee 
    
    I didn't interpret this to be the case.
    
�but I have a *big* problem with bonuses being paid
�    where the revenue  came from fees IN DIRECT DEFIANCE OF THE WISHES OF
�    THE CUSTOMER/OWNNERS. 
    
    Have the fees already been implemented?
    
�I would also want assurance that every DCU
�    employee participated in the bonuses, not just management.
    
    I think it says something to that effect in the BoD meeting minutes.

    
    Re: .30
    
    > Have the fees already been implemented?
    
    Who knows?  We can't get any straight answers.  They may
    well have been implemented but not yet levied.
    
    Steve
    
    
    

A chief concern of President Cockburn - and I've heard this in every
discussion I've ever had with him since the whole Mangone fiasco began -
is the capital ratio.   Everything he's talked about in terms of plans,
the future, current strategies, etc., have revolved around a couple
things:  growing DCU, and preserving the capital ratio.

After posting record earnings in what appears to be a combination of
decent management and good fortune (low interest rates and red-hot
refinancing action), and with DCU having taken at least its first
baby steps toward being more service-oriented (longer branch hours,
credit union 'private auto sales', etc.), I can understand management's
desire to reward it's performing employees.  In fact, it makes sense to
do so under the right circumstances.  And that they are discussing 
gainsharing in the context of all employees rather than just management,
I find the basic concept difficult to argue against.

However, we're being told that the capital ratio is still not good enough,
that the credit union is being brought down by members who do not do 
enough business to pull their own weight, and that it's necessary to 
institute a fee structure in order to combat these evils.  Further, we 
haven't received a penny in bonus dividends - despite the fact that
we provided DCU with record business last year, and have been very good
"credit union citizens" with regard to loan default despite the trying
times within Digital.  

Given all of the preceding, it seems rather unrealistic to me for DCU to
be paying bonuses to its employees while it denies bonus dividends to its
ownership and lays the groundwork for a fee structure on services.

What makes this even more unpaletable is that DCU is raking in money,
showing tremendous profits, and doing quite well thank you, while taking
enormous subsidies from Digital (ever look closely at an ATM machine - they've
got "Digital Asset Tags" on them; ever go to a branch office in a DEC
facility - bought and paid for by Digital Equipment Corporation) while
Digital itself is still sailing dangerously close to the rocks.

I'd really like to see the Directors of this fine financial institution
justify their actions.  I'd like to hear DCU's management comment on
this.  

I'm curious, Phil...has there ever been any talk of a bonus dividend
for the membership?  

./chris

    There is much concern in Digital about what "Wall Street" thinks
    of us and how it's our job, as a corporation and as Digital employees, 
    to give our shareholders a return on their investment...to the point 
    of layoffs and cutting benefits, even to the point of denying permission 
    to buy basic supplies.
    
    Well, we the members are the "stockholders" of DCU.  Isn't it the job
    of DCU and its employees to give us a return on *our* investment?
    
    Is there something more to the story?  Have DCU employees been working
    on short rations for the past couple of years as DCU dug itself out
    from under the Mangone fiasco?  If so, I'm all for giving them some
    compensation for sacrifice as soon as possible.  But, if it's just been
    "business as usual," I think bonuses are a little premature.

  It's better than business as usual for those that proposed fees and bonus's.
They are obviously related.  We get screwed from both ends!