Ala. Code § 37-6-3

Current through the 2024 Regular Session.

Section 37-6-3 - Enumerated powers

A cooperative shall have the power:

(1) To sue and be sued in its corporate name.

(2) To adopt a corporate seal and alter the same at its pleasure.

(3) To generate, manufacture, purchase, acquire and transmit electric energy and to distribute, sell, supply and dispose of electric energy to its members, to governmental agencies and political subdivisions and to other persons; provided, however, that should a cooperative acquire any electric facilities dedicated or devoted to the public use, it may continue to serve the persons served directly from such facilities at the time of such acquisition without requiring that such persons become members, and, provided further, that such nonmembers shall have the right to become members upon nondiscriminatory terms. Cooperatives may not condition membership or provision of service on compliance by the member with requirements not directly related to the electric or other service to be provided by the cooperative.

(4) To process, treat, sell, and dispose of water and water rights and to purchase, construct, own, and operate water systems and to supply water services.

(5) To purchase, construct, own, and operate sanitary sewer systems and supply sewer services.

(6) To purchase, construct, own and operate systems and facilities for providing television reception services through the use of television program decryption equipment and subscriber owned, leased or rented satellite dishes, but such equipment shall not be utilized for the bi-directional transmission of voice, data, or other signal.

(7) To make loans to persons to whom electric energy, water, sanitary sewer or television reception services through the use of television program decryption equipment and subscriber owned, leased or rented satellite dishes is or will be supplied by the cooperative for the purpose of, and otherwise to assist such persons in, wiring their premises and installing therein electric, water, sanitary sewer and plumbing fixtures, appliances, apparatus and equipment of any and all kinds and character or to make loans to or assist such persons in constructing, maintaining and operating electric refrigeration plants, and, in connection therewith, to purchase, acquire, lease, sell, distribute, install, and repair such electric, water, sanitary sewer, plumbing, and television reception services through the use of television program decryption equipment and subscriber owned, leased or rented satellite dishes, fixtures, appliances, apparatus, and equipment and to assist in any manner members in the efficient and economical use of electric energy, water, sanitary sewer, or television reception services that are described in subsection (6) of this section. Loans made under this subsection may be made out of general funds or otherwise and such loans shall not be subject to the provisions of Chapters 18 and 19 of Title 5, or other similar legislation that may be adopted in the future.

(8) To accept, or otherwise acquire, and to sell, assign, transfer, endorse, pledge, hypothecate, and otherwise dispose of notes, bonds, and other evidences of indebtedness and any and all types of security therefor. To make loans to persons to whom electric energy, water, and sanitary sewer service is or will be supplied by the cooperative for the purpose of, and otherwise to assist such persons in constructing, maintaining, and operating electric refrigeration plants.

(9) To become a member of one or more other cooperatives and to acquire, hold and dispose of and exercise any power or right with respect thereto or with respect to the shares or other interests in, or obligations of other public or private domestic or foreign corporations, associations, partnerships or individuals whether or not such entities pursue purposes, exercise powers, or engage in activities that the cooperative is authorized to pursue, exercise, or engage in.

(10) To construct, purchase, take, receive, lease as lessee or otherwise acquire, and to own, hold, use, equip, maintain, and operate, and to sell, assign, transfer, convey, exchange, lease as lessor, mortgage, pledge, or otherwise dispose of or encumber electric transmission and distribution lines or systems, electric generating plants, electric refrigeration plants, water lines, sanitary sewer lines, water systems, and sanitary sewer systems, television reception equipment through the use of television program decryption equipment and subscriber owned, leased, or rented satellite dishes, lands, buildings, structures, dams, plants, and equipment and any and all kinds and classes of real or personal property whatsoever, which shall be deemed necessary, convenient or appropriate to accomplish the purpose for which the cooperative was organized or in which it subsequently lawfully engages.

Electric generating plants, transmission, and distribution lines or systems as referred to in this section shall include any arrangement or agreement for the purchase, exchange, or transmission of electric power, capacity or energy, whether sole or as joint owner of all or any part in common with one or more persons as agent, or as principal, and shall include ownership of an undivided interest in facilities with any other person. Any agreement with respect to such facilities may include provisions for the construction, operation, and maintenance of electric generation, distribution, or transmission facilities by any one or more of the parties to the agreement or by any other means which may be determined by the parties thereto, and may include provisions for a method or methods of determining and allocating, among or between the parties, costs of construction, operation, maintenance, renewals, replacements, improvements, retirement, and disposals with respect to the facility and the entitlement of joint owners to the production capability or utilization of the facilities including allocation of costs in the event of default on the part of one or more joint owners and the payment of all such costs as provided in the agreement. Any such agreement shall supersede any provision of law to the contrary relating to the rights of joint owners of property and relating to the use of property, title to which is held by the cooperative jointly with others and, notwithstanding anything contained in any other law to the contrary, pursuant to the terms of any agreement authorized in this subdivision, the cooperative may delegate any and all of its powers and duties with respect to the construction, operation, maintenance, renewal, replacement, improvement, retirement or disposal of electric generation, distribution or transmission facilities to the party or parties acting as agent, managing partner, managing co-owner of the party otherwise given such responsibility or authority pursuant to the agreement and all actions taken by such other party in accordance with the provisions of the agreement may be binding upon the cooperative without further action or approval by the cooperative. Such agreements may provide for purchase, acquisition, and ownership of project capability or amounts of electric capacity and energy, if any, which a project is capable of producing at any particular time (including times when the project is incomplete or not operable or not operating or the operation thereof is suspended, interrupted, interfered with, reduced, or curtailed in whole or in part for any reason whatsoever) and may provide for the payment of proportional shares of costs of the project, including debt service and deposits for reserves and contingencies as directed or established by the project manager and including increases in such payments to cover project costs upon the default of any participant and to enter into agreements requiring payments by the cooperative of an unconditional nature, irrespective of whether any electricity or other service is received in return for such payments and irrespective of whether the cooperative acquires any ownership interest in any tangible physical property.

(11) To purchase or otherwise acquire and to own, hold, use, and exercise and to sell, assign, transfer, convey, mortgage, pledge, hypothecate, or otherwise dispose of or encumber franchises, rights, privileges, licenses, rights-of-way, and easements.

(12) To borrow money and otherwise contract indebtedness and to issue notes, bonds, and other evidences of indebtedness therefor, and to secure the payment thereof by mortgage, pledge, deed of trust or any other encumbrance upon any or all of its then owned or after acquired real or personal property, assets, franchises, revenues, or income.

(13) To make any and all contracts necessary or convenient for the full purpose of the powers in this chapter granted, including, but not limited to, contracts with any person, federal agency, or municipality for the purchase or sale of electric energy, water, water and sanitary sewer services, or television reception services through the use of television program decryption equipment and subscriber owned, leased, or rented satellite dishes and in connection with any such contract to stipulate and agree to such covenants, terms and conditions as the board of trustees may deem appropriate, including covenants, terms and conditions with respect to resale rates, financial and accounting methods, services, operation and maintenance practices and, consistent with Section 37-6-20, the manner of disposing of the revenues of the properties operated and maintained by the cooperative.

(14) To construct, acquire, maintain, and operate electric transmission and distribution lines, water lines, sewer lines, and television reception systems, and equipment through the use of television program decryption equipment, and subscriber owned, leased, or rented satellite dishes along, upon, under, and across all public thoroughfares, including without limitation all roads, highways, streets, alleys, bridges, and causeways and upon, under, and across all publicly owned lands; subject only to reasonable rules and regulations as to safety that the respective authorities having jurisdiction thereof shall require.

(15) To exercise the power of eminent domain in the manner provided by the laws of this state for the exercise of that power by corporations constructing or operating electric generating, transmission, or distribution lines, or systems; and, in the construction and operation of water systems and sanitary sewer systems and television reception systems through the use of television program decryption equipment and subscriber owned, leased or rented satellite dishes, to exercise the power of eminent domain in the manner provided in Title 18.

(16)

a. A cooperative shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed claim, action, suit, or proceeding, whether civil, criminal, administrative, or investigative, including appeals (other than an action by or in the right of the cooperative), by reason of the fact that he is or was a director, trustee, officer, employee, or agent of the cooperative, or is or was serving at the request of the cooperative as a director, trustee, officer, partner, employee, or agent of another cooperative, corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys' fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by him in connection with such claim, action, suit, or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the cooperative or other entity, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any claim, action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the cooperative, and with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful.

b. A cooperative shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed claim, action, or suit by or in the right of the cooperative to procure a judgment in its favor by reason of the fact that he is or was a director, trustee, officer, employee, or agent of the cooperative, or is or was serving at the request of the cooperative as a director, officer, partner, employee, or agent of another cooperative, corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the cooperative or other entity and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the cooperative or other entity unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which court shall deem proper.

c. To the extent that a director, trustee, officer, employee, or agent of a cooperative or other entity has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in paragraphs a. and b. of this subdivision, or in defense of any claim, issue, or matter therein, he shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith, notwithstanding that he has not been successful on any other claim, issue, or matter in any such action, suit, or proceeding.

d. Any indemnification under paragraphs a. and b. of this subdivision (unless ordered by a court) shall be made by the cooperative only as authorized in the specific case upon a determination that indemnification of the director, trustee, officer, employee, or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in paragraphs a. and b. of this subdivision. Such determination shall be made (i) by the board of directors or trustees by a majority vote of a quorum consisting of directors or trustees who were not parties to, or who have been wholly successful on the merits or otherwise with respect to, such claim, action, suit, or proceeding, or (ii) if such a quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors or trustees so directs, by independent legal counsel in a written opinion, or (iii) by the shareholders.

e. Expenses (including attorneys' fees) incurred in defending a civil or criminal claim, action, suit, or proceeding may be paid by the cooperative in advance of the final disposition of such claim, action, suit, or proceeding as authorized in the manner provided in paragraph a. of this subdivision upon receipt of an undertaking by or on behalf of the director, trustee, officer, employee, or agent to repay such amount if and to the extent that it shall be ultimately determined that he is not entitled to be indemnified by the cooperative as authorized in this section.

f. The indemnification authorized by this section shall not be deemed exclusive of and shall be in addition to any other right (whether created prior or subsequent to the enactment of this section) to which those indemnified may be entitled under any statute, rule of law, provisions of articles of incorporation, bylaw, agreement, vote of members or shareholders or disinterested directors or trustees, or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, trustee, officer, employee, or agent and shall inure to the benefit of the heirs, executors, and administrators of such a person.

g. A cooperative shall have power to purchase and maintain insurance on behalf of any person who is or was a director, trustee, officer, employee, or agent of the cooperative, or is or was serving at the request of the cooperative as a director, trustee, officer, partner, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against him and incurred by him in any such capacity or arising out of his status as such, whether or not the cooperative would have the power to indemnify him against such liability under the provisions of this section.

(17) To conduct its business and exercise any or all of its powers within or without this state.

(18) To adopt, amend, and repeal bylaws.

(19) To provide its members and other persons services solely for the reception of television programming through the use of television program decryption equipment and subscriber owned, leased, or rented satellite dishes, but such equipment shall not be utilized for the bi-directional transmission of voice, data, or other signal.

(20) To assist any other cooperatives organized under this chapter in the execution of its purposes and powers.

(21) To apply a surcharge on its rates to those members or other consumers which it serves in a political subdivision imposing a requirement on a cooperative which necessitates the incurrence of additional costs in providing service in that political jurisdiction or a portion thereof in an amount and for a time sufficient to recover such additional costs and the carrying charges thereon.

(22) To make and enter into contracts of guaranty, including, without limitation, obligations of a generating and transmission cooperative which is the wholesale power supplier of the cooperative, whether or not the cooperative has a direct interest in the subject matter of the contract with respect to which it acts as guarantor or surety. Notwithstanding any contrary provision of Section 37-6-21, in connection with any such guaranty, without authorization of its members, to secure its guaranty obligations by executing a guarantor's note and securing such note or its guaranty with a mortgage on all or any portion of its property, assets and the revenues and income therefrom. Such mortgage may be to the party for whose benefit the guaranty is given, to other guarantors of the debt guaranteed by the cooperative or to an agent, trustee or other representative of the holder of the guaranty or other guarantors.

(23) To do and perform any and all other acts and things and to have and exercise any and all other powers which may be necessary, convenient, or appropriate to accomplish the purposes for which the cooperative is organized or in which it subsequently lawfully engages.

Ala. Code § 37-6-3 (1975)

Acts 1939, No. 231, p. 371; Code 1940, T. 18, §33; Acts 1977, No. 577, p. 764, §2; Acts 1987, No. 87-787, p. 1541, §2; Acts 1989, No. 89-658, p. 1303, §1; Acts 1992, No. 92-206, §1.