Private Interest Law: The Case Against Delta EPA

Preston Quesenberry

Vol. 18, No. 3-4, 1996 pp. 22-23

Challenging an institution as tricky to define in legal terms as a rural electric cooperative can prove a difficult task. An unsuccessful lawsuit filed in 1983 against the Delta Electric Power Association provides a vivid demonstration of some of these inherent complexities.

The plaintiffs in the case of Givens, et al. v. Delta Electric Power Association felt they had encountered a clear and egregious example of discrimination. Since 1967, the all-white Delta board of directors simply had been re-appointing itself at annual meetings without a quorum. Moreover, since the founding of the co-op in 1937, the board had never had a black member, despite the fact that forty-four to fifty-five percent of the co-op's customer-members were estimated to be African American. Then in 1983, the board carried out a series of actions which seemed flagrantly designed to prevent the election of three African-American candidates.

For one, co-op officials refused to give the group of black Delta members supporting the challenge candidates a list of the names and addresses of cooperative members--a list necessary to mobilize black voters and secure proxy votes--until the day after the election. The co-op also changed the time of the annual meeting from 2 p.m. to 10 a.m., with the "apparent hope of dissuading members from attending," in the candidates' opinion.

Despite these obstacles, a record number of more than 100 African Americans (most of whom carried the three proxy votes allowed in the co-op's bylaws) appeared at the April 12, 1983 meeting to vote their candidates into office. The incumbent board responded by announcing the absence of a quorum and abruptly adjourning the meeting without entertaining a motion made by the members, as required in the written bylaws.

After the incumbent board left the meeting, the assembled members continued the proceedings and elected eleven new board members, all of whom were African American. The incumbent board ignored this election, however, and called another special election for June 14, 1983. Meanwhile, the board continued to act in ways that black members interpreted as discriminatory. First, the directors amended the bylaws to allow each member to vote an unlimited number of proxies rather than three proxies, as was previously allowed. Then they printed and mailed out proxies to all of the members and ran an advertisement encouraging members to return their proxy--none of which had ever been done before. According to one of the challenge candidates, all of these actions had the effects of insuring "that the votes of black members, who are in the minority, will be diluted and cancelled out."

At the June 14 meeting, no black Delta members and only forty white members showed up, but the all-white board used 7,587 proxy votes to declare a quorum and re-appoint themselves.

Justice Not Applicable

A federal class action lawsuit was filed on behalf of the co-op's black members, in which the plaintiffs charged they were "deprived of their right, because of race, as members of the cooperative, to participate cooperative's board of directors."

In the ensuing four-year legal battle, however, federal district court judges ruled that many of the legal weapons commonly used by attorneys to fight racial discrimination in governmental elections were unavailable in the case of cooperative elections. For one, the attempted use of voting rights legislation was "frivolous." one judge argued, because "Delta Electric is a private corporation and its corporate elections were limited to the cooperative's members." The use of constitutional amendments (in particular, the Fourteenth Amendment which ensures due process and equal protection) was also unfounded, the judge said, because "Delta Electric is a private corporation, which cannot be liable for a constitutional deprivation."

Realizing they were dealing with a private and not a governmental entity, the plaintiffs' attorneys believed their best weapon against the co-op was Title VI of the Civil Rights Act of 1964, which states that federally-funded institutions cannot act in ways which intentionally discriminate or have discriminatory effects. Delta, like all co-ops, receives federal funds in the form of no- or low-interest loans from the Department of Agriculture.

However, the court ruled that there was no direct relationship between the federal funds Delta received and the way it allegedly discriminated. The judge argued


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that Delta did not use its loan funds to carry out elections but only to construct, operate, and upgrade its electrical distribution system. Therefore Title VI was only applicable, the judge said, if Delta somehow discriminated in providing electrical service to its customers. The plaintiffs tried to convince the court that Delta did discriminate against blacks in providing service, but the judge ruled the evidence in fact indicated "that predominantly black neighborhoods received better treatment."

According to Paul Sonn of the NAACP Legal Defense Fund, this reading of Title VI--which required a direct "nexus" between the federal funds used by a program and the specific manner in which the program discriminated--was common in the early- to mid-1980s. In 1984, the U.S. Supreme Court upheld this way of reading Title VI in Grove City College v. Bell.

But in 1988, the U.S. Congress decided that Title VI was meant to offer broader protection against racial discrimination in federally-funded institutions and passed the Civil Rights Restoration Act. The act states that an institution receiving federal funding cannot discriminate (either intentionally or effectively) in any of its activities. Because of this act, Sonn says a similar suit brought against Delta today could not be dismissed for the same reasons.

--P.Q.

Sidebar: Opportunity Comes to Roanoke Electric

What may be the only majority-black electric cooperative board in the nation resulted, in large part, from a consistently active majority-black membership.

Of the nine board of directors of Roanoke Electric Cooperative in Rich Square, North Carolina, five are African-American and four are white--proportion which roughly corresponds to the ratio of black to white co-op members (about 53 percent to 47 percent).

The black members--hundreds of who regularly turn out at annual meetings--first won representation in 1970, when two white incumbent board members died. The remaining board members tried to nominate another two white men at the 1970 annual meeting, but the black membership refused.

"They broke up the meeting, they wouldn't let them have it," remembers Matthew Grant, one of the two candidates elected in 1970 and now president of the co-op's board. "So the directors felt like they had to put some blacks on the board. One of the areas that had been pushing had a black man that they wanted to put on. The put him on, and they also put me on."

The board then proceeded to dilute the votes of its two new black members, charges Grant, by changing the bylaws to expand the number of board seats to eleven--a change which was overturned several years later.

In 1981, for the first time, a white incumbent board member was defeated in a democratic election by a black challenger. The black members, who as usual constituted the majority of members present a the meeting, nominated their own candidate form the floor and successfully elected him into office, bringing the number of black board members up to three. The next two black candidates elected to the board were not nominated by the customer-members from the floor but were appointed by the board.

According to Grant, a struggle among the board members occurred over the appointment of the fifth black member to the board. The white board members "really didn't want us to have a majority, and they have fought it," Grant says. "But we go tone of the white fellas to vote with us, so we were successful."

Since the board became majority-black, Grant says he and fellow board members have finally been able to pursue an aggressive equal employment opportunity agenda. Before a majority was won, blacks were hired only for lower-level, manual labor positions, Grant says, but now the board has made sure that blacks are hired for administrative position.

Currently, forty percent of the co-op's sixty-two employees are black, and an independent watchdog committee has been set up to monitor future hiring.