Rebuilding OMECO

At long last, after almost a decade, the 30th OMECO Annual General Membership Assembly (AGMA) which has become so elusive to the people of San Jose due to the BOD’s deliberate stand to hold it in other far flung municipalities of Occidental Mindoro for reasons known only to them is ours to savor comes 31 May 2009 for it will become an avenue where matters of critical importance besetting our beloved cooperative could be ventilated and thereby addressed.

Middle of year 2005, after ascertaining the facts relative to the very alarming and worsening financial condition of our cooperative based on valid documents which comes to our possession via underground, as we were not provided same by then General Manager Alex Labrador in spite of several request, OMECO is fast sinking like a boat and nearing to go bankrupt if we just let things pass by.

Showing our deep concerns to the plight of our ailing cooperative, we immediately inform the BOD’s and the top management of the true standing of the cooperative because it appeared that they do not have the deeper grasp of what is going on in their turf. We also asked them to institute drastic reform measures so that the unabated depreciation of OMECO’s resources could be curtailed as the situation then is perceived to be still manageable in over-turning its negative operating performance.

We make certain our demand of terminating the services of Mr. Alex Labrador based on legal grounds as he is no longer effective and competent to remain in his post. But instead of appreciating our concerns, we are rebuffed for no justifiable reasons and everything goes on as a big big joke. Why? Simply because the BOD’s issued a resolution expressing their confidence to GM Labrador instead of terminating him for cause! Hopeless of the situation, we brought our predicaments to NEA with a prayer for their definitive actions as they exercise regulatory powers over the cooperative. Sad to say, NEA failed also to take determinant acts as they always tossed the ball to the BOD’s that is not so responsive to the issues.

The struggle continued for three (3) long years and the price of inactions by both the BOD’s and the NEA exacted a great toll on us member-consumers as the true owner of the cooperative and in which they are fully accountable. And as we have feared long before, our OMECO greatly retrogressed and went technically BANKCRUPT since its capital base assets were not even enough to compensate for all of its obligations.

The combination of forces of some concerned citizens, the church and the disgruntled employees of OMECO led to the creation of a de facto SAVE OMECO MOVEMENT which bannered coordinated efforts for the needed reform in the cooperative. Its no let-up advocacies eventually forced the BOD’s and the NEA to take definitive actions over Mr. Alex Labrador which compelled him to voluntarily end his services as General Manager of OMECO. The rest is history.

NOW is the opportune time for us to do our share in the rehabilitation of our beleaguered OMECO where efforts to make it financially viable are next to impossible because of the following factors:

1. OMECO is cash stripped and do not have much resources to meet the on-going concerns of its day to day operation.

2. OMECO’S deficit in spending is at the average of 2.5M a month.

3. OMECO could not generate additional revenue to augment its cash position because its present distribution system cannot accommodate expansion.

4. OMECO has no cash for the needed materials necessary to reduce system loss. Reduction in system loss will translate to a valuable cash inflow for OMECO.

5. OMECO indebtedness to NPC for unpaid power bill, E-Vat, interest charges, surcharges and penalties is now at the benchmark of 250M. NPC demanded OMECO to be current in its payment; otherwise, power supply cut-off will be imposed on a periodic basis.

6. OMECO does not have the cash to pay the member-consumers meter deposits which has been ordered by ERC to be refunded comes 2011.

Viewed in the light of the foregoing circumstances, we are therefore appealing for the continued support of the Kamay-ari on the following course of actions that we deemed proper and urgently necessary in propelling back OMECO into a financially viable cooperative, viz:

1. An action requesting NEA to extend emergency financial and technical assistance to the comprehensive recovery/rehabilitation plan of OMECO.

2. An action requesting NPC to extend more considerations and leeway’s in their treatment of OMECO outstanding obligations by way of condoning the interest, penalties and surcharges on its account and by allowing onother restructuring of debts to loan with a longer duration and with the General Appropriations Act of 2009 as the legal basis.

3. An action requesting NPC to offset the amount of Php38M+ paid by OMECO to Fabmik as genset rentals against its collectibles to the cooperative in the spirit of cooperation and due observance of the missionary mission of NPC as enunciated by the EPIRA law. OMECO under the current set-up should only be in the business of power distribution. Power generation in the missionary areas like ours is the domain of NPC.

4. An action declaring the meter deposits which are due for refund by 2011 as ordered by ERC to be an additional patronage capital of member-consumers with certain qualification.

5. An action directing the OMECO’s management to implement massive cost reduction in the areas of system loss, operational expenditures and personnel retrenchment.

6. An action requesting the Mother of the Province of Occidental Mindoro, Governor Josephine Ramirez Sato whose mandate emanate from us to help in whatever manner in the implementation of the comprehensive recovery/rehabilitation plan of OMECO.

7. An action requesting the League of Mayors of the Province of Occidental Mindoro to help in whatever manner in the implementation of the comprehensive recovery/rehabilitation plan of OMECO.

8. An action to amend some provisions of the cooperative By-Laws which are found to be no longer responsive as of recent time.

9. An action calling for the immediate constitution of the Multi-Sectoral Electrification Advisory Council (MSEAC) so that the ten (10) sectoral components of the community could have a share in the effective governance of OMECO.

10. An action requesting NPC to fastrack the completion of their 69 KV lines from Calapan, Oriental Mindoro all the way to San Jose, Occidental Mindoro via Abra de Ilog and also the probable interconnection of Mindoro Island to Main Luzon Transmission Grid of Transco via submarine cables as the pegged power supply requirement of 50MW for the two (2) provinces has already been attained. These will guarantee the cooperative to have sufficient power to distribute and the power consumers to be assured of reliable and dependable power supply at present and future power requirement levels.

11. An action calling for an increase participation of member-consumers through an Special Assembly Meeting (if AGMA is not yet forthcoming) before the cooperative through the BOD’s and the management could enter into any power supply contract with qualified power providers as we have sad and bitter lessons to reckon in this.

12. An action calling for the authorization of the Save Omeco Movement representatives to the BOD’s to become Ex-Officio members (2 permanent and 2 alternate) effective immediately and will remain only up to the duration of recovery process.

Coupled all of the above with the emergence of vibrant and responsible Directors in the BOD’s, the manifested enthusiasm and firm convictions to govern effectively on the part of the new management, the ultimate resolved of the Save Omeco Movement to be part and parcel of the critical planning and policy promulgations, the avowed intervention of local government units to help in whatever manner they can, and of course, the Kamay-ari extending their full trust and confidence during the recovery process, we believe OMECO can be great once again.

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(Note: This piece is originally entitled "OMECO: Rebuilding the Ruins to Prominence; An Appeal to "Kamay-Ari" to Make the Cooperative Great Again" written by Mr. Joaquin "Jake" L. Castronuevo, SAVE Omeco Convener; Photo: SSC File)