MEMBERSHIP ON EXECUTIVE BOARD

MUNICIPAL CORPORATIONS ‑- JOINT OPERATING AGENCY ‑- WASHINGTON PUBLIC POWER SUPPLY SYSTEM ‑- MEMBERSHIP ON EXECUTIVE BOARD

If a member of the executive board of a joint operating agency who has been selected from its board of directors is subsequently removed from the board of directors due to retirement, recall, attrition, or other reason, that person may no longer remain as a member of the executive board in an inside director position.

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                                                                 August 18, 1982

Honorable King Lysen
St. Sen., 31st District
12864 Shorecrest Drive S.W.
Seattle, Washington 98146                                                                                                               Cite as:  AGLO 1982 No. 21

Dear Sir:

            By letter previously acknowledged you requested our opinion on the following question relating to membership on the executive board of a joint operating agency such as the Washington Public Power Supply System:

            "If a member of an operating agency Executive Board that has been selected from the operating agency Board of Directors is subsequently removed from the Board of Directors, due to retirement, recall, attrition, or other action by the legislative body of an operating agency member, can that person remain a member of the Executive Board, and if so, under what circumstances?"

            We answer the foregoing question in the negative for the reasons set forth in our analysis.

                                                                     ANALYSIS

            Chapter 43.52 RCW governs the formation and operation of a special type of municipal corporation referred to as a joint operating agency.  See RCW 43.52.360, the opening paragraph of which reads as follows:

            "Any two or more cities or public utility districts or combinations thereof may form an operating agency (herein sometimes called a joint operating agency) for the  [[Orig. Op. Page 2]] purpose of acquiring, constructing, operating and owning plants, systems and other facilities and extensions thereof, for the generation and/or transmission of electric energy and power.  Each such agency shall be a municipal corporation of the state of Washington with the right to sue and be sued in its own name."1/

             Under the original legislation providing for the establishment of such joint operating agencies, the function of management and control was vested in a board of directors composed of representatives of each member of the operating agency.  See, RCW 43.52.3702/ prior to its amendment by the 1981 legislature.  As the consequence of a 1981 amendment, however, most of the powers and duties of the board of directors have been shifted to an eleven-member executive board.3/   And, in turn the law was again amended by § § 2 and 3, chapter 43, Laws of 1982, 1st Ex. Sess. so as to give rise to your present question which, repeated for ease of reference, asks:

            "If a member of an operating agency Executive Board that has been selected from the operating agency Board of Directors is subsequently removed from the Board of Directors, due to retirement, recall, attrition, or other action by the legislative body of an operating agency member, can that person remain a member of the Executive Board, and if so, under what circumstances?"

The particular provision of the law which governs our answer is RCW 43.52.374 as amended by § 3, chapter 43, supra.  Set forth in bill form for ease of understanding, that amended section reads, in material part, as follows:

            "(1) With the exception of the powers and duties of the board of directors described in RCW 43.52.370(2), the management and control of an operating agency constructing, operating, terminating, or decommissioning a nuclear power plant under site certification  [[Orig. Op. Page 3]] agreement under chapter 80.50 RCW is vested in an executive board established under this subsection and consisting of eleven members.

            "(a) ((Seven))Five members of the executive board shall be elected to four-year terms by the board of directors from among the members of the board of directors.  The board of directors may provide by rule for the composition of the ((seven)) five members of the executive board elected from among the members of the board of directors so as to ((afford fair representation which reflects))reflect the member public utility districts' and cities' participation in the joint operating agency's projects. The board of directors may also provide by rule for the removal of a member of the executive board, ((including)) except for the outside directors.  Members of the board of directors may be elected to serve successive terms on the executive board.

            "(b) ((Four))six members of the executive board shall be outside directors ((and)).  Three shall be selected and appointed by the board of directors, and three shall be selected and appointed by the governor and confirmed by the senate. . . .

            ". . .

            "(c) ((The president of the board of directors shall be a nonvoting member of the executive board and shall serve as the presiding officer of the executive board.))The governor may remove outside directors from the executive board for incompetency, misconduct, or malfeasance in office in the same manner as state appointive officers under chapter 43.06 RCW.  For purposes of this subsection, misconduct shall include, but not be limited to, nonfeasance and misfeasance."

            Your question, as we understand it, relates only to the (now) five members of the executive board who are elected "to four-year terms by the board of directorsfrom among the members of the board of directors."  (Emphasis supplied) Must those five remain members of the board of directors in order to continue as members of the executive board?  Or, instead, is membership on the board of directors only a qualification for initial election to the executive board?

             ([Orig. Op. Page 4)]

            We are of the opinion that the statute imposes a continuing qualification for executive board membership in each of the five "inside director" positions to which subsection (1) (a) refers‑-rather than simply a restriction on the initial election of non-members of the board of directors to those positions4/

             It is a well-established principle that to correctly understand any statute, inquiry must first be made to ascertain its subject and the general object intended to be accomplished by it.  When this is done, words subject to a possible narrow construction may be expanded to embrace the legislative intent and to effectuate that intent.  SeeState ex rel. Blume v. Yelle, 52 Wn.2d 158, 162, 324 P.2d 247 (1958);Howlett v. Cheetham, 17 Wash. 626, 630, 50 Pac. 522 (1897).

            Here, the general object and purpose of this legislation was a transfer of basic responsibility for the management of a joint operating agency from its board of directors (consisting of representatives of all participating utilities) to a smaller, and partially independent, executive board.  Initially, under the 1981 enactment, the inside directors were actually in the majority‑-with seven positions to four.  But, then, under the 1982 amendment, this majority status was shifted six to five to the outside directors.

            What all this means to us, however, is that the legislature was acutely conscious of the separate status, and qualifications, of the two categories of members of the executive board.  Yet, as will readily be seen, to allow a person initially elected as an inside director to continue serving on the board of directors even after his removal (for whatever reason) from the board of directors would be in derogation of the balance thus established by the legislature.  That balance, in turn, particularly assures that the political constituencies of the members of the board will have a direct and continuing influence on those members of the executive board during their terms in office.