Board of Directors Meeting Minutes: June 2020

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Brattleboro Food Co-op Board of Directors

Held via Zoom

Monday, June 1, 2020

Directors Present: Mark Adams, Mary Bené, Judy Fink, Denise Glover, Grace Koch, Skye Morse, Beth Neher, Tamara Stenn, Jerelyn Wilson. Staff, Shareholders and Others Present: General Manager Sabine Rhyne; Board Administrator Sarah Brennan; Shareholders Tristan Roberts and John Hatton

The meeting was called to order by President Jerelyn Wilson at 5:15 pm.

  1. Agenda Review: No changes were proposed.
  2. Approval of Minutes: Mary moved to accept the minutes of the May 4, 2020 meeting; Tamara seconded. The motion to accept the minutes with one typo correction passed unanimously.
  3. Shareholder Input: Jerelyn acknowledged Jon’s report on May/June feedback, and noted that we are monitoring more feedback than ever before, including Facebook messages.
  4. GM Report: We are currently open to foot traffic Monday – Friday from 11 am – 7 pm and Saturday/Sunday from 9 am – 7 pm. We offer next day curbside pickup Monday – Friday from 7 – 10; calls received Friday are for pickup on Monday. Discussion focused on the following:
    • Sales: Curbside sales have slowed down, fueling the decision to open the store a little more. We have some very big curbside days, and continue to have spectacular sales with basket sizes over $100. We’re moving towards feeling slightly better about sales, but are not there yet.
    • Staff Responsibilities Shifting: Deli staff are transitioning back to their original roles as we add more Deli offerings. Kudos to Dawn Hastings, Scott Martin, and staff generally. We have posted for some open shifts. Designated curbside pickup location: a work in progress. Stay tuned.
    • Hero Pay: is running about $11K/week. We are about 3 percentage points above our labor/sales target. We’ll be talking with the union about rolling it back soon. It is more expensive to do curbside sales and we are only now getting to point where we can be precise about the numbers. When we get online orders functional, we’ll be better able to manage expenses.
    • DEI: Follow up training is anticipated this summer; we’ve been in touch with LaDonna Sanders Redmond.
    • IBB (Interest Based Bargaining): This methodology, used in our contract negotiations, emphasizes identifying core interests.
    • Labor Expenses: What is driving the high sales per labor hour? We are getting more efficient and we’re getting people back to their regular areas of focus. Deli sales are normally 50K/week at a 60% target margin (because of all the labor entailed): that’s a significant impact on our profitability. As more Deli/Kitchen staff pivot to production these numbers will improve.
    • Cash: Next month you’ll see the PPP influx as having been spent down.
    • Online ordering: The delay in implementing this is a function of getting information on local products loaded into the system.
  1. Breakout Groups: Jerelyn outlined the goals of the exercise: for Board members to gain fluency and comfort in describing the changes to the discount program and the rationale for those changes. Unanswered questions that came up during the exercise include the following:
    • What is going to happen to the staff discount?
  • Do we have to know all the numbers?
  • What are the criteria for joining Food for All and is Medicaid one of them?
  • How do our discounts compare to other co-ops?
  • Will seniors with accrued hours in 2025 be able to transition those hours to working shareholder hours?
  • What are we going to do if a significant number of Elders decide to go back to being a regularly working shareholder to hold onto at least a 5% discount?
  • Skye will write up notes on the rationale for the discount program changes based on his FFT article.
  1. GM Financial: Pre-COVID-19, we would be reviewing the three-year plan at this meeting. Given that many of the things originally slated for that plan are no longer relevant, or have been overtaken by more important priorities, Sabine provided an update and revised timeline for presenting the plan to the Board in July. Highlights:
  • Self-service: No self-service items until there is a vaccine.
  • Equipment: We are working on coordinating changes in equipment, space, and displays for both the immediate and long-term future. With a loan from CFNE, we’re buying curbside pickup coolers for the vestibule, and touchless coffee dispensers in the Deli.
  • Dottie’s: We will have to look carefully at this, and potentially integrate Dottie’s into our business.
  • First year focus: Revamping our operations to be in line with our sales. Renewed focus on DEI training and carrying that through in our hiring and training practices.
  • Second year: Infrastructure to support better inventory management. Microloan program for local producers and manufacturers.
  • Third year: Continued inventory management, including a POS (point of sale) system upgrade.
  • Discussion: Perpetual inventory: this is a system whereby as goods come in, they are entered into our inventory, and as they are sold, they are removed. It takes an investment in time, organization, and labor to make it work well. Now would be the time to implement it. It would help us be more on top of profitability. Projected Sales Trends: Once we get back to a slightly more balanced mix of curbside and open hours, we’ll get back to and above previous year sales. Any sales increases will be small, probably only in the 1.x% range over the next few years. We will have a tough conversation at negotiations as past staff pay increases have been higher than projected sales increases. Delivery: we may be partnering with Food Connects on this.
  • Next steps: The July packet will have the three year plan; Sabine might send the preamble portion out earlier.
  1. Board and GM Monitoring
    1. Beth moved, and Judy seconded, to accept the Board’s Monitoring Report for QIV 4 Cost of Governance. Discussion: Beth and Jerelyn have high standards for “governing with excellence”. Board candidate training: Coming to Board meetings and following up with candidates afterwards is considered training. Board budget: The Board is only responsible for its piece of the overall Co-op budget (part of the board administrator’s pay, the annual meeting/report, directors and officers insurance, board meeting expenses (meals, though not lately) and board development (training)). Sarah interfaces with Accounting to track expenses. The Board collaborates with the Marketing department on the annual meeting. The motion carried unanimously.
    2. Beth moved, and Grace seconded, to accept the Board’s Monitoring Report for QIV 5 Records Policy. Discussion: Sarah explained where to find approved minutes: on the website, on the bulletin board at Shareholder Services, and in a fireproof filing cabinet in the offices. The motion carried unanimously.
    3. Upcoming monitoring:
      • GM policies: QII 3 Relationship with Employees. This was scheduled for July, but due to the pandemic will be delayed until August and/or September. We do a full survey every two years, and a smaller sampling on the alternate years. This is a full-survey year. We are kicking it off for the end of June and it will run through July. Several questions on the staff survey are in the QII 3 monitoring report, which allows for an apples-to-apples comparison over time.
      • Board policies: QIV 7 Board Officers, QIV 9 Board Relationship to Shareholders, and QIV 10 Board Committees. No time for discussion here. Re: QIV 7: Jerelyn will work with current Board officers to obtain their current practices, and will send out an email next week with details. Sarah will then send out the monitoring report surveys.
  1. Board Committees
  2. Shareholder Engagement. Judy moved, and Denise seconded, that the Board approve the wording of the “The Brattleboro Food Coop Board Directors Give Back” statement (packet, p. 39), which describes how shareholders can support staff during this pandemic. Discussion: none. The motion carried unanimously.
  3. Member Recruitment: Mary reported that there are three seats up for election, with the high probability of a fourth, as Grace’s Americorps gig will end prior to elections. Mary has not spoken with Mark yet, to give him breathing room to decide if he wants to run. Mary herself will stand for re-election; Skye will not. She is speaking to Tristan and two others about running.
  4. Ends Committee: Beth reminded Board members that our current bylaws combine our mission and purpose statements, and that the Ends Committee is separating those two into distinct statements. Jerelyn moved, and Judy seconded, that the Board recommend for Shareholder approval that the following Section be removed from the bylaws:

Section 1.2 – Purpose and Mission. The Co-op exists for the purpose of meeting the needs of its shareholders, on a cooperative and nonprofit basis, with a focus on food and related products, and supporting the larger cooperative movement.

And replaced with the following:

Section 1.2.1 Purpose: The BFC shall be owned by its members and shall operate with a focus on food and related products in accord with the ICA Statement on Cooperative Identity (cooperative principles) for the mutual benefit of its members.

Discussion: The committee will continue to work on the mission statement. The motion carried unanimously.

  1. Policies and Bylaws: The committee is seeking Board decisions regarding several proposed changes to Bylaws.
    1. Jerelyn moved, and Beth seconded, that the Board recommend for Shareholder approval that Section 1.4 be deleted from the Co-op’s Bylaws.

Section 1.4 – Business Office. The business office of the Co-op shall be located at 2 Main Street in Brattleboro, Windham County, Vermont.

Discussion: We learned that it’s not required to include this information in our bylaws. The motion carried unanimously.

  1. Jerelyn moved, and Denise seconded, that the Board recommend for Shareholder approval changes to Bylaw Section 2.1, such that it reads as follows (new text shown underlined in red):

Section 2.1 – Eligibility. Shareholder status in the Co-op shall be voluntary and open to any person or organization who is in accord with its purpose and mission, will use its services, is willing to accept the responsibilities of shareholder status, and accepts patronage dividends as a condition of shareholder status.

Discussion: This change is prompted by a comment from Finance Manager Ken McGee to the effect that it may help us avoid losing unclaimed dividends (as a form of unclaimed property) to the state of Vermont. Sabine stated that she is not certain whether this proposed addition to the bylaws would help – it may be worth obtaining legal advice on this. The Policies and Bylaws Committee will investigate further. The motion failed unanimously.

  1. Jerelyn moved, and Judy seconded, that the Board recommend for Shareholder approval changes to Bylaw Section 2.2, such that it reads as follows:

Section 2.2 – Admission. Applicants shall be admitted to shareholder status upon paying or subscribing for a share of common stock at its then stated value. In the event of questionable eligibility, admission shall be subject to approval by the Board of Directors. On or before admission to shareholder status each applicant shall be provided a copy of these bylaws, including the appended explanation of the patronage dividend consent provision, such copy indicating its date of approval or adoption (see Appendix). An organization applying for membership must maintain a single individual as an authorized representative.

Discussion: We learned that a shareholder does not need to have a SSN or EIN, so we can just call it an “organization” instead of a “legal entity”. We want the language to be consistent with bylaw 2.1. The motion carried unanimously.

  1. Jerelyn moved, and Judy seconded, that the Board approve the new discount rates slated to go into effect July 1 which are described in the Board packet and in the May 1st, 2020 “Food for Thought”, and to recommend to the shareholders that they be ratified at the Annual Meeting in November. Discussion: This proposal is made in light of bylaw section 2.3, which states that changes to the working member discounts are “subject to ratification at the next scheduled shareholder meeting”. The Board focused on what would happen if the shareholders failed to ratify the new discount. Would we have to refund discounts earned between July 1 and the vote? Board members agreed that running this by our attorney would be advisable. It may be necessary for the Board to take this up at a special meeting before the changes to the discount program go into effect on July 1. The motion failed unanimously.
  1. Meeting Outcomes: Board members shared what they would tell a shareholder about this meeting, as well as what worked well or not so well about the meeting itself.

Jerelyn reminded Board members to send her their response to the proposal to engage LaDonna Sanders Redmond for DEI training.

 

The meeting was adjourned at 6:56pm.

Sarah Brennan, Board Administrator

 

Sarah Brennan, Board Administrator

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