A public forum held by Garden Grove mayor Bao Nguyen last night at the city’s community center examined the cost of and alternatives to a proposed $1 billion ocean desalination plant promoted by the Orange County Water District.
Those issues–and the panel of local experts who discussed them last night–have been all but ignored by most of the OCWD Board of Directors, some of whom have strong financial and political ties to Poseidon Resources Inc., the company that would build the plant, and its big-business allies.
The OCWD maintains the county’s groundwater basin, which holds 66 million acre-feet of water and provides about 70 percent of the water used in central and northern Orange County, serving 2.3 million people.
For the past 18 months a clique of four board members, Cathy Green, Shawn Dewane, Stephen Sheldon, and Denis Bilodeau, joined last January by Garden Grove Councilmember Dina Nguyen, have steered the District straight toward a long-term contract with Poseidon.
OCWD staff presented a proposed term sheet (pre-contract) to the board on May 14.
The board approved the term-sheet 7 -3. Nugyen voted for it.
Nguyen, who was the beneficiary of $11,000 in “independent expenditures” by a Poseidon related PAC in her recent election to the OCWD board, was invited to participate in the forum but was a no-show.
Staff is now negotiating a contract with Poseidon that would lock the district into buying 56,000 acre-feet of desalinated ocean water per year, regardless of need, for the next half-century.
Poseidon’s water would cost about $2,000 an acre-foot out the door, more than 3 times what OCWD currently pays for the untreated water it imports from the Metropolitan Water District of Southern California (MET) to help maintain the county’s groundwater basin supply.
Poseidon and its allies on the OCWD board claim that its more expensive water would be a “reliability premium” akin to car insurance that would add to the county’s water supply portfolio and guarantee water during a drought.
But, in order to be financially viable, Poseidon is demanding hundreds of millions of dollars in ratepayer-backed subsidies for the first 15 years of the contract. In return, MET rules require that Poseidon’s 56,000 acre-feet of desalinated water replace an equal amount of (cheaper) imported water, which would then be made available to water agencies outside of OCWD’s service area.
There would be no net gain in water supply for the district, which would be paying three times as much for Poseidon’s replacement water while subsidizing the cheaper imported water for other agencies. And the county wouldn’t receive more water during a drought.
This reporter has repeatedly asked Poseidon officials and OCWD directors to explain the benefit to ratepayers of paying three times as much for water than necessary and subsidizing cheaper water for ratepayers outside of Orange County, but to so far mum’s the word.
For the first 15 years, the proposed pricing scheme would pay Poseidon a surcharge of up to 20 percent on imported MET water (at the higher MWD treated rate) on top of a 3 percent annual compounded surcharge that recurs for the life of the contract, underlying subsequently declining variable surcharge rates.
A Surf City Voice review of the proposed pricing scheme shows that after 15 years ratepayers would pay up to $2,700 per acre-foot for Poseidon’s water (assuming the required $56,000 af) versus about $1,048 per acre-foot for untreated MET water, which comes out to about $1.8 billion versus about $700 million in total for that period.
That’s about $1.1 billion dollars that could be used for the cheaper and more efficient water supply alternatives ignored by OCWD and Poseidon but examined by the forum panel of experts.
Panel members are former Huntington Beach mayor Debbie Cook, Irvine Ranch Water District’s Peer Swan, Coastkeeper’s Ray Hiemstra, and Garden Grove water officials. Members of the public, including Westminster City Councilmember Diana Carey, also spoke.
Editor’s note: Part of this story has been retracted and corrected. Please see that retraction and correction (here) before reading this story. Thank you.
The Mesa Water District Board of Directors will throw a $49,650 VIPs (and selected press) only “private ceremony” to celebrate the completion of two years of renovations on its Colored Water Treatment Facility, according to an official announcement tucked deep within the district’s official website and a purchase order obtained by the Voice.
But the closed event suggests that either the board has trouble controlling its general manager, Paul Shoenberger—who is the everyday boss of the district but is supposed to follow board policies—or in complying with California laws that prohibit using public funds for personal purposes, or both.
The $21 million facility—started in 2000—removes an amber tint, caused by an ancient redwood forest, from part of Orange County’s groundwater basin. But the treatment has a cosmetic effect only because the water supply, despite its color, is already completely safe to drink.
The celebration, funded primarily by ratepayers, Mesa documents show, but co-sponsored by various private water industry concerns too, promises a select group of invitees to three hours of plant demonstrations, tours, Native American music, and food and beverages, as well as “recognition from notable elected officials.”
Sources inside Mesa told the Voice that Gov. Jerry Brown, Costa Mesa congressman Dana Rohrabacher and State Senator Allan Mansoor had been invited. The press release promises only a “commendation from Governor Brown and other U.S., state, and local government and water representatives,” however.
The event will be held this Wednesday from 1 – 3 p.m. at the facility, located at 1350 Gisler Avenue in Costa Mesa.
The press release brags that the facility, recently renamed Mesa Water Reliability Facility, makes Mesa Water the second water district in Orange County that doesn’t have to rely on more expensive water imported from northern California or the Colorado River.
It’s “the largest accomplishment in Mesa Water’s history since its formation in 1960,” the official press release says.
But members of the general public will not be allowed to join in the expensive celebration that they are paying for unless given a special invitation by the whim of Mesa officials.
In the spirit of old-fashioned political patronage, board members can invite five guests each.
Since the celebration is advertised by Mesa Water as a private event, however, it has at least the appearance of illegality on its face.
But even if the event has been scheduled for a public purpose, which the PR indicates it has not, “A public official possesses only those powers that are conferred by law, either expressly or impliedly.”
The purchase order for the Colored Water Treatment Facility renovation celebration, approved by Communications Director Stacy Taylor, presumably under the consent of General Manager Shoenberger, at $49,650 (for labor and materials), exceeds GM’s spending limit—set by the board by resolution—of $25,000.
But not only didn’t the board approve of Shoenberger’s overspending his limit on the celebration, it never voted to make the event private or to even have it at all, according to Mesa Water Director Fred Bockmiller.
“It’s something that Mesa staff wanted to do,” he said. “And this is the way they wanted to roll out various roll-outs of the Colored Water Treatment Facility,” now known as the Water Reliability Facility. “I don’t believe there was ever a vote on it being an event.”
Bockmiller said that he sees nothing wrong with holding a private event paid for with public funds.
It’s not unethical, he said, and other water districts, like the Orange County Water District when it opened its ground water replenishment (sewage recycling) program, do it too.
Like at OCWD, public tours of Mesa’s Water Reliability Facility are likely to follow, he indicated. And, the press release also indicates, tours are available to the public by appointment.
Water board critic and former Huntington Beach Mayor Debbie Cook agrees with Bockmiller that other water districts act the same way, but she sees different implications from that fact.
“This board is demonstrating a reckless disregard for ratepayer money: They act in ignorance of the law, and they exercise no control over their CEO,” she told the Voice by e-mail.
Photo: Paul Shoenberger by the Surf City Voice
“The sad part is they are just one more bad actor in the water industry.”
Whether you are an aging activist, annoyed elected official, or aggrieved citizen, the recently published Slow Democracy is the elixir for returning citizens to their rightful role in self governance.
Our country was founded on participatory democracy. It has largely devolved into a faux democracy where we elect others to “represent” us. And when they don’t, we scream, march, blog, and organize in order to be heard. Such blunt instruments may produce short term results but they also leave permanent scars that divide our communities.
Slow Democracy challenges us to implement real democracy at the local level through a prescription of deliberation.
The deliberation as defined by Authors Susan Clark and Woden Teachout is long, careful and inclusive. Creative forums for communication and understanding are the foundation for better decisions.
The book beautifully demonstrates the sharp contrast between our fast fooddemocracy with its mandatory “public” hearings, reliance on “experts,” and top down mandates, versus a deliberative process that allows all parties to be heard, encourages investigation, and empowers diverse groups of citizens to move forward on difficult issues like water, education, and planning.
Authors Clark and Teachout hail from Vermont. My first thought was, sure, I can see it in small town Vermont, but not megalopolis California. But their examples of deliberative processes stretch from coast to coast.
In Felton, California residents fighting dramatic water rate increases wanted to buy back their privatized water system. They mobilized to pass a bond measure and, under threat of eminent domain, were able to regain control. Along with lower water rates and increased transparency, they built a solar installation and preserved 250 acres of watershed. Citizen participation added tremendous value to the results.
In Gloucester, Massachusetts, residents, armed with the success of the Felton experience, were determined to buy back their town’s drinking water from the private corporation that had let its quality deteriorate until it was no longer drinkable.
A diverse group of residents mobilized and wrote a mission statement: “to accurately inform the public, to share in the civil discourse, and to participate in the decision making process.”
They conducted community meetings, targeted residents in every way possible, and empowered the local citizenry. The city council unanimously approved a resolution declaring “local control of their water as a democratic right.”
Their deliberative approach guaranteed the community members a place in the decision making process.
The most satisfying experiences I have had in local government, as both an activist and an elected official, have been those rare deliberative processes that somehow snuck into our traditional “Roberts Rules” top down governance structures. Where members of the public, along with city staff and elected officials, take the time to deliberate over an issue, the results can be magical.
By contrast, wounds become septic at public hearings where millions of dollars have been spent, decisions have already been made, the vote is just a formality, and where everyone speaks and no one listens.
Resilient communities happen where people listen together, investigate together, plan together and act together.
At a recent water meeting in my community, a group of residents who have been fighting a water project for the past ten years were almost bowled over when one of the board members suggested that perhaps they should conduct a workshop so that the project’s opponents would have an opportunity to explain their concerns.
It may be ten years too late or it may be a fresh start toward greater participation.
Either way, Slow Democracy provides a roadmap. Slow Democracy: buy it, share it, apply it.
Public comments have wrapped up and at the San Diego County Water Authority special board meeting to consider a 30-year water purchase agreement with Poseidon Resources Inc. to supply up to (but as yet unknown) 56,000 acre feet of water for San Diego County by desalinating up to 100 million gallons of ocean water to turn it into 50 million gallons of drinking water each day from off the coast of the city of Carlsbad.
Supporting the $1 billion project: big business interests, politicians, chamber of commerce, labor etc. Opposed: environmentalists, ocean users and activist rate payers. About evenly divided so far. The board room is full, about 160 people in attendance. Locals speaking: former Huntington Beach mayor Debbie Cook, former Fountain Valley mayor Gus Ayer. You can listen to the arguments pro and con and to the subsequent vote online at http://www.sdcwa.org/meetings-and-documents. More later.
Update: Board discussion is underway now. “Direct the General Manager to refer to nine Carlsbad Desalination Rate Structure Alternatives to the Cost of Service Consultant and return to the Board with a recommended alternative to allocated the cost of the Carlsbad Desalination Project: Staff Recommendation: Approve the submission of nine requested Carlsbad Desalination Rate Structure Alternatives to the Cost of Service Consultant.”
Vote on motion by Director Mudd, 2nd by Boyle: 95.85 % of the vote cast and passes unanimously. Only 2 of the 24 water agencies under the SDCWA umbrella have signed a memorandum of intent to buy water to be produced from the the project.
Under consideration: Adopt resolution approving: 1) Water Purchase Agreement with Poseidon Resources; 2) Design Build Agreement; 3) Agreements necessary to accomplish tax exempt project financing through the California Pollution Control Financing Authority; 4) Adjustments to the Capital Improvement Program Budget; 5) Supporting contracts and contract amendments; 6 Other actions necessary for implementation of the Carlsbad Desalination Project; Staff recommendation: approve.
Vote taken on Water Purchase Agreement passes with 85 percent of the vote (vote is weighted according to property values in each district).
Photo top right: Fred R. Bockmiller, President of the board, Mesa Consolidated Water District.
Fred R. Bockmiller, president of the Board of Directors for the Mesa Consolidated Water District headquartered in Costa Mesa, had listened to the public speak its mind at the board’s July 24 meeting.
Former Huntington Beach mayor Debbie Cook and I were the only unofficial witnesses in attendance except for Joan Finnegan, who serves on the board of directors for the Municipal Water District of Orange County.
Cook and I had come to speak about Mesa Water’s policy for disclosing public records. Proposed revisions to that policy were on the meeting agenda.
“With that, we’ve had public input,” declared Bockmiller, who took command of the meeting in his deep and officious voice. “And I do take public input very seriously because it’s rare that people de-stir themselves and take time to come down here.”
Bockmiller was right about one thing—public citizens, including journalists, are a rare sight at Mesa Water meetings, which, with the exception of the twice-monthly regular board meetings, are held during the morning or afternoon hours when most people are working.
Mesa Water’s board and its General Manager Paul Shoenberger (absent from the July 24 meeting) like to brag about their commitment to transparency. But, like other Orange County California water districts, Mesa’s public meetings are not televised or video and audio streamed online—by comparison, most city council meetings are.
Nor is there a monthly calendar online—public meetings are announced on the agency’s website only a few days before they occur.
A bi-monthly newsletter sent to the households of Mesa Water rate payers and available online (with some difficulty finding it) announces that the full board meets twice a month, but doesn’t mention the three other monthly committee meetings during which a lot of Mesa’s real work gets done.
For my own records, I preserved portions of the meeting in video and audio format, but the night’s most interesting revelations were captured – after Cook and I left – by Mesa Water’s own mp3 (audio) recording system that, untold to the public, is hooked up to the microphones of the agency’s directors and administrative staff and records everything said at each board meeting.
Also untold by Mesa Water (unless you know to ask), anybody can acquire a copy of those recordings through the Public Records Act, the topic that brought Cook and I to the meeting.
Cook is an environmental attorney and served two terms as mayor of Huntington Beach. As a long-time public official, she knows something about how local government works. For the past year she has been applying that experience to her efforts to monitor transparency issues at Orange County water districts.
Based on Cook’s knowledge of how the city of Huntington Beach deals with public records disclosures as well as my own experience obtaining public records from Mesa Water, we offered our comments. Whereas the Public Records Act intends to empower the public in its search for public records, we found Mesa Water’s policy at times to be intimidating and inconsistent with state law.
Cook compared the State Attorney General’s “clear and concise” PRA summary that “makes you feel like, yes, indeed, these are your documents, and we are here to help you” to Mesa Water’s policy, which, she said, didn’t always conform to the law and “discourages people from requesting documents.”
Bockmiller Interrupts Speaker
Like many government bodies, Mesa Water’s board allows three minutes per speaker, precious little time to make an important point. So interruptions of public speakers by officials are not only rude but can lead to legal consequences as well.
But Bockmiller abruptly cut Cook off in the middle of her speech, and admonished, “I’m going to have to stop you there and ask—you’re making an accusation that we’re not conforming with state law. So, if you are” –
“Sir,” Cook protested back.
“If you have specific information, I would like to hear it. Thank you,” Bockmiller concluded.
“But you really should not interrupt the public speakers,” Cook shot back. “After the fact, it’s clear you can ask questions. But when you interrupt a speaker, then you really do cross another legal line.”
Cook continued, citing a passage in Mesa Water’s policy that exempts from disclosure “Purely personal information contained in a correspondence, e-mail or in a Mesa water computer which is unrelated to the conduct of Mesa Water’s business (i.e. which is totally void of reference to governmental activities).”
That passage is unlawful, Cook said.
“Any e-mail that is sent using your district’s e-mail server—it doesn’t matter whether it talks about your dogs and your kids or whatever, that is all subject to a Public Records Act request, all of it open to public inspection.”
Cook went on to explain “in a nice way” how the City of Huntington Beach had gone to great lengths to place public documents online, including meeting agendas and minutes going all the way back to 1909 (by contrast, Mesa Water’s websites contains minutes and board agenda packets for 2011 and 2012 only).
Huntington Beach doesn’t have a written Public Records Act policy other than to follow the law, Cook added.
“I would suggest that perhaps you rethink having a stated policy because it really does just open you up to legal challenges,” Cook concluded.
Still stung by Cook’s rebuke of his rude interruption, Bockmiller quipped, sarcastically, “Thank you very much, Ms. Cook, and I appreciate the lesson in conducting a proper board meeting. Thank you very much.”
Jail Time for CalDesal Secrets?
When I spoke to the board, I pointed out that California’s Government Code requires public documents be kept for a minimum of two years, but that Mesa didn’t seem to have a retention policy (there is a retention policy, but it was not attached to the text being updated that night, nor was it available on Mesa Water’s website).
On two occasions, I added, I had been refused public documents on the grounds that they had been transferred to a private non-profit agency and were no longer in Mesa’s hands.
The documents concerned CalDesal, a secretive 501 (c) 6 non-profit organization that lobbies for desalination projects and deregulation on behalf of public water agencies and private industry.
CalDesal was officially formed by Mesa Water’s general manager, Paul Shoenberger, with the informal approval of the board. Director Shawn Dewane is the president of CalDesal and votes on its board as a representative of Mesa Water.
Speaking to the board, I referred to sections 6200 and 6201 of the Govt. Code and section 1170 of the Penal Code, both of which warn of jail or prison sentences ranging up to four years for the destruction of public records.
“There are apparently some people here who may be eligible for a jail sentence,” I cautioned.
I wondered how Dewane could serve as CalDesal’s president and never bring back any documents to Mesa Water’s office, which would have put them in the public domain.
Concluding my comments, I officially renewed my request for CalDesal related documents and asked for Mesa Water to retrieve the documents that it had previously handed over to CalDesal, at the Mesa Water’s expense, not mine.
That ended public comments.
“Mr. Attorney,” asked Bockmiller, of Mesa’s legal counsel, “does this policy conform in all respects with state law?”
“Yes, it does. It was reviewed by our office and prepared in accordance to the Public Records Act,” the attorney answered.
Mesa Water’s PRA policy is not required by statute, he added, in response to further questions from Bockmiller, but it’s not unusual for public agencies to have one, although he could not say how many do.
As for redacting incidental personal information from e-mails, the attorney was less certain.
“I would have to go back and review with them (other legal staff at his firm who approved the policy language) the specific source of this language,” he said.
That’s about when Bockmiller said that he took public comments “very seriously,” recalling that when he campaigned to for election to the board he spoke out often at board meetings and “always hoped that the district took my comments, which I made a lot of, seriously at the time.”
Mesa Water rarely hears public comments, he acknowledged, “but when we do, as Mesa Water always does, we take them seriously.”
In that context, he wanted to see legal citations for my claim that some Mesa officials might be eligible for jail sentences (those citations were provided to all board members the next day by e-mail).
By mistake, Bockmiller and Director James Fisler thought that I had singled out members of the board.
“It’s the general broad immunities that you have when you are serving on a board,” he said, explaining his view of government accountability. “[It] seems highly unlikely that we would be held responsible for that. But that’s ok. It’s always good to hear,” he said.
Director Jim Fisler, who I had not asked for records, took offence and proclaimed that “This board doesn’t provide records to Mr. Earl. This board has not been asked for records by Mr. Earl.”
Lacking the urgency to vote on the matter, the board decided unanimously to take the matter back to its legal counsel for review. It would be discussed at the next meeting of the executive committee, Aug. 21 at 2 p.m. and brought back later to the full board for consideration.
“With that,” Bockmiller declared, hammering his gavel, “we will adjourn for a brief recess.”
Despite Bockmiller’s rude and blustering manner, the board’s vote seemed to prove that our comments would be taken seriously, just as he promised.
But within seconds after Cook and I left the board room, Bockmiller and Administrative Service Manager Coleen Monteleone expressed their real feelings of contempt for the public.
And it was all captured on Mesa Water’s MP3 (audio) recorder.
Monteleone, who had been present as acting general manager in the absence of Paul Shoenberger, speaking to Bockmiller, started the embarrassing conversation with a sarcastic broadside at Cook.
“I don’t care what the city of Huntington Beach does, but thanks for letting us know,” she said, sarcastically.
Bockmiller, laughing, also mockingly addressing Cook, cracked, “What they did when you were on the board, which you are no longer.”
Monteleone: “Right, she is not on the council anymore.”
Bockmiller: “No, she’s not on the council.”
Monteleone: (pretending to speak to Cook) “Beat it!”
Then Denise Garcia, Executive Assistant to the General Manager, entered the conversation.
“I have an experience I would love to share with you about finding records for the city of Huntington Beach.”
Bockmiller: “Yes, that would be good, to find your own records.”
Bockmiller, still feeling contemptuous, then informs Director Dewane, CalDesal’s president, that he has asked legal counsel to look into a “potential legal issues,” such as “that somehow by your touching any CalDesal document it mysteriously turns into a public record.”
“No issue,” Dewane replies.
Director Trudy Ohlig-Hall, seemingly questioning the motives of Cook and myself for our interest in public documents, offers her opinion that, “There’s something more behind it too.”
“Oh, I’m sure there is,” Bockmiller agrees.
Fisler suggests it has something to do with opposition to two ocean desalination plants, one proposed for the city of Carlsbad and the other for Huntington Beach.
Then the conversation turns back to the legal issues.
Dewane: “I would appreciate being included in that conversation.”
Bockmiller: “Yeah, we’ll get that legal opinion, since it involves you.”
Dewane: (jokingly) “I don’t want to go to jail.”
Bockmiller, more seriously, acknowledges that nobody at Mesa wants to go to jail and attempts again to reassure everyone present that nobody is going to jail.
“Yeah, I can’t think of any time when any person in the state of California, under any circumstances, was sent to jail for public records issues,” Bockmiller is heard saying.
“Most likely they might have been fined or, you know, the public records had to be produced or whatever. But it seems unlikely that anyone actually went to jail for a Public Records Act thing.”
Then director Ohlig-Hall comes up with what might be the best bit of advice offered to the public officials at Mesa Water or anywhere.
“Just keep your pants on, that’s all. Then you don’t have to go to jail.”
Postscript: On Aug. 28 the Mesa Water Board of Directors voted to accept the revised Public Records Act policy but with some additional changes. After consultation with legal counsel, it was acknowledged, contrary to the board’s previous assumption, that Mesa cannot require PRA requests to be in writing, although the agency may reduce such requests to writing for clarity. The exemption for “purely personal information” was “clarified” but not dropped.
In response to Director Fisler’s previous belief that board members did not have to act on PRA requests made of them by the public, legal counsel advised that “pursuant to both State law and the policy, Public Records Act requests made to Mesa Water, or its Directors or employees, should be directed to the District Secretary.” At the Aug 21 Executive Committee meeting It was also noted by legal counsel that materials brought back to and stored at Mesa Water are public documents.
Finally, legal costs to Mesa Water’s ratepayers for the latest revision of its PRA policy—when other much better written summaries already exist for free—is unknown at this time.
Things are heating up in the fight to stop the misnamed Cadiz Valley Water Conservation Project—cultivated in secret backroom meetings held by corporate water brokers and public water officials—that we are told conserves water that would otherwise evaporate by sucking it from a desert aquifer under the delicate Mojave Desert and transporting it 200 miles to Orange County to water the lawns of future urban sprawl.
The growing allegations of Cadiz-related conflicts, incestuous political relationships, and self-dealing had reached a peak last month when Santa Margarita Water District’s chief champion, John Schatz, abruptly retired from his lucrative job there as General Manager/General Counsel.
Schatz even cancelled his last scheduled regular board meeting after learning that a group of desert residents planned to attend.
Environmental attorney Debbie Cook is a former Huntington Beach City Council member and two-term mayor of that city. She served on California’s State Desalination Task Force and as a city official voted against the ocean desalination plant proposed by Poseidon Resources Inc. Cook has been monitoring government transparency at local water districts. She made these public comments at a special meeting held by the Board of Directors of the Municipal Water District of Orange County (MWDOC), May 15, 2012, in the penthouse floor that lodges the offices of MWDOC’s legal counsel, Best Best & Krieger. She addressed the board’s postponement of a closed session item concerning water rate negotiations between MWDOC and Posedion Inc. after receiving protests. Cook explains why that meeting would violate the Brown Act, which requires government agencies to hold meetings open to the public.
There has been an unsettling trend among water agencies to conduct more and more of the people’s business in closed session under the guise of the “real estate negotiations” exception. While you can always pay an attorney to argue any absurd position, I urge you to reconsider such a course.
The Brown Act allows very narrow exceptions to conducting the public’s business in public and the real estate exception is perhaps the most narrowly drawn of all of them.
Poseidon is not selling, nor are you buying, real estate or real property within the meaning of the legislature’s intent. It is a contorted analysis that says otherwise.
Real Property is land and whatever is erected or growing on or affixed to it. But once severed from the land, things that are growing or attached to it are considered “goods.”
Confronted by complaints of illegality, the Municipal Water District of Orange County (MWDOC) dropped a scheduled closed session section of a meeting of its board of directors scheduled for today (May 15) at 11 a.m.
General Manager Kevin Hunt had scheduled the closed session in order to meet with officials of Poseidon Resources Inc., the company that proposes to build the as yet unfinanced and unpermitted $750 million ocean desalination plant that would convert about 100 million gallons of ocean water into 50 million gallons of drinking water every day.
The public meeting will go ahead minus the Poseidon item, but instead of holding session at MWDOC’s regular location in Fountain Valley, the seven board members will meet at the offices of the agency’s new legal team, Best, Best & Krieger (BKK).
Lunch will be served, according to the agenda.
The topic of discussion for the now deleted closed session item, according to the original agenda, was “price and terms of payment” for the water that Poseidon would produce.
California’s open meetings law, the Brown Act, requires that all legislative meetings be open to the public, with certain exceptions like negotiations for the sale or lease of real property. Water rights are treated as real property and Hunt, under advice from BKK, assumes that Poseidon holds water rights for the drinking water it will presumably produce, according to Hunt, a view that is disputed. Continue reading GM Nixes Secret Desal Talks with Poseidon After Brown Act Complaints→
Belated opposition is hurriedly forming to a plan that would pump an average of 50,000 acre-feet of water per year out of the aquifer in San Bernardino County’s eastern Mojave Desert and convey it in a pipeline to Riverside, Orange and Los Angeles counties to replenish the water supply there.
The Santa Margarita Water District, which services an area that is more than 200 miles from the Cadiz Valley, is the lead agency for what is called The Cadiz Valley Conservation, Recovery and Storage Project. As the lead agency the SMWD, the second largest water district in Orange County, will oversee the California Environmental Quality Act (CEQA) review process for the project.
Santa Margarita will work with the Cadiz Land Company in the proposed undertaking, which is a modified version of the Cadiz Water Project floated by Cadiz Land and the Metropolitan Water District more than a decade ago. The original project called for the Cadiz Land Company pumping water from the Colorado River during wet years, storing it in an underground aquifer beneath the Cadiz Valley, and selling as much as 60,000 acre-feet of the native groundwater and Colorado River water mix to the Metropolitan Water District of Southern California (MWD) in Los Angeles during dry years.
That proposal was ultimately rejected by the MWD’s board of directors after conservationists raised concerns over possible environmental damage. That rejection led to expensive litigation between the Cadiz Land Company and the MWD.
The concept lay dormant for six years. But in 2008 the Cadiz Land Company, also known as Cadiz, Inc., revived the plan in modified form, emphasizing less the drawing of water from the Colorado River and instead proposing to obtain much of the water from sources feeding the area’s dry lakes that are subject to evaporation.
The revived project was given a tentative budget of $536.25 million and is to entail the sinking of 34 wells into the desert and construction of a 44-mile pipeline along a railroad right-of-way until it meets up with the aqueduct that carries Colorado River water to the Los Angeles and Orange County metropolitan areas.
Through the arrangement with the Cadiz Land Company, the SMWD will receive the lion’s share of the water. In addition, Cadiz, Inc. has entered into agreements with Three Valleys Water District, which provides water to the Pomona Valley, Walnut Valley, and Eastern San Gabriel Valley; the Golden State Water Company, which serves several communities in Southern California, including Claremont; Suburban Water Systems, which serves Covina, West Covina and La Mirada; and the Jurupa Community Services District, which serves Mira Loma in Riverside County.
The Cadiz Valley is located just south of the Marble Mountains and northeast of the Sheep Hole Mountains near the National Trails Highway. Cadiz is home to a former railroad stop along the Santa Fe line, 17 miles east of Amboy and 70 miles from Needles.
The public hearings related to the Cadiz Valley Conservation, Recovery and Storage Project were held in Yucca Valley, which is 85 miles from Cadiz, and in Rancho Santa Margarita, which is 217 miles from Cadiz. Many people directly impacted by the project were not notified of the hearings. Neither was the Bolo Station Water Company, which serves the Cadiz Valley and the property adjoining that of the Cadiz Land Company.
Among those at the forefront of the movement to oppose the Cadiz Valley Conservation, Recovery and Storage Project is former Needles city councilwoman Ruth Musser-Lopez, who was previously employed as a Bureau of Land Management Archaeologist assigned to the California Desert District and was active in opposing the first Cadiz Water Project.
Musser-Lopez decried the project as one that would confiscate a vital and rare resource from the desert region. She said the Cadiz Land Company and the SMWD had formed an unholy alliance of a rapacious corporation and a quasi-governmental agency that was abusing the approval and environmental certification processes to violate the rights of the region’s residents while depriving future generations of desert dwellers access to water.
John V. Foley, chairman of the Metropolitan Water District of Southern California, failed to report over $248,000 of income from his wife, Mary Jane Foley, back to 2004, records obtained by the Surf City Voice under the Public Records Act show.
California’s Political Reform Act requires government officials, including employees and consultants, to publicly disclose their relevant economic interests, often including spousal income, within 30 days of assuming office and annually thereafter.
The officials make their disclosures on a Statement of Economic Interests or “700” form with their respective agencies, after which the information goes to the county and state. The report helps to highlight potential conflicts of interest they may have with issues that come before a government decision making body.
Under the Act, water board directors are required during meetings to disclose any potential conflicts they have with agenda items and to recuse themselves from the decision making process by leaving the room (for consent calendar items they must recuse but can stay in the room).
California Government Code 1090 is even stricter than the ACT.
Recognizing the indirect as well as direct influence that public officials have on decision making, 1090 prohibits any financial conflict of interest by those officials over contracts, even if the official isn’t voting; those officials, it says, “shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members.”
Since 2001, public records obtained by the Voice indicate, Foley’s wife has run her own business, MJF Consulting, Inc., while being paid directly or indirectly for consulting work by water agencies throughout southern California, including the MET and the Municipal Water District of Orange County (MWDOC).
Foley, who has served on the MET since 1989, claimed that he was unaware of any obligation to report his wife’s income.
“I never felt it was required. You know, I don’t have no problem with it,” he told the Voice after a MWDOC meeting last September.
The Voice became aware of some of Foley’s missing financial disclosures after examining his 700 forms going back to 2006. But when questioned, Foley said that he had never reported his wife’s income.
But on October 25, a month after he was questioned by the Voice, Foley filed amended financial disclosures back to 2004 that include most – but not all – consulting income from his wife for each year, records show.
Foley did not respond to requests by the Voice to explain why he updated his disclosure reports and why they are still incomplete. But, according MWDOC General Manager Kevin Hunt, who was present at an interview with Foley conducted by SoCal PBS, Foley said that he had been advised by MET attorneys that it would be “more transparent” to revise his disclosures.
MET spokesperson Bob Muir refused to reveal any confidential advice given to Foley by MET legal counsel, but he did say that no disciplinary action was considered by the board for failing to comply with financial disclosure laws.
The still (partially) missing disclosures involve a three-year $125,000 contract between Byran Buck Associates (BBA) and five water agencies: the MET, MWDOC, San Diego Water Authority, West Basin Municipal Water District and the City of Long Beach Water Department.
Under the terms of the contract, which was administered by the MET, Mary Jane Foley was guaranteed a minimum amount of work as a subcontractor. She was paid $160 per hour or about $45,000 over the contract period. A total of $108,945 or $21,789 each was spent by the five agencies.
The contract was approved by the MET’s general manager, so it did not go to the board for a vote, although contracts for far less value sometimes do– a matter of the GM’s choice, according to MET regulations, when a contract is for $250,000 or less.
The BBA contract violated the law, says former Huntington Beach mayor Debbie Cook, who is also an environmental attorney. Cook has been examining the complex and often hidden operations of local water agencies and was recently interviewed as part of a PBS SoCal expose of the Santa Margarita Water District in south Orange County.
‘A Clear Violation’
Referring to the three-year contract, Cook concludes that it directly benefited long time director Jack Foley and his wife Mary Jane Foley.
“This is a clear violation of Government Code Section 1090. An agency like MWD [MET], with the kinds of resources it has available, should know better,” she wrote in an e-mail to the Voice.
Efforts to contact Chairman Foley since September have been unsuccessful, so far. But MET media spokesperson Armando Acuna, responding to inquires about the legality of Chairman Foley’s standing under 1090, told the Voice, also by e-mail, that “Metropolitan’s Legal Department represents Metropolitan and cannot give legal advice or a legal opinion to members of the public.”
The minimum estimate of $248,000 of unreported income is based on the BBA contracts as well as direct contracts between MWDOC and MJF Consulting, Inc., matched against income sources revealed in Foley’s amended 700 filings (but not including income from other, mostly private, sources that were also part of the amendment filings).
Mary Jane Foley’s work with the five water agencies involved regulatory, permitting and lobbying issues for a proposed ocean desalination plant at Dana Point and for the growth of ocean water (and brackish water) desalination plants throughout California. She is still under contract with MWDOC.
As Chairman of the MET, John Foley selects all members of all standing MET committees and appoints the chairpersons for all special committees and task forces. Before starting his second stint as chairman he headed up the MET’s Special Committee on Desalination and Recycling from its start in 2009 through 2010.
Foley regularly votes on desalination issues at the MET and discusses them at various MWDOC meetings. He is highly venerated by his peers throughout southern California and has strong Republican Party connections going back decades.
The MET casts a vast influence as a water wholesaler over all of southern California, including Ventura County, the Inland Empire, Orange County and San Diego. It delivers 1.6 billion gallons of water per day to 26 cities and water districts, including MWDOC, and to 19 million people, according to its website. MWDOC, in turn, helps manage water for its 28 water agencies and member cities in Orange County.
Foley is one of four appointees chosen by the MWDOC board of directors to represent it on the MET – and he is one of two within that group who were not elected by voters to either board.
The other unelected MET director representing MWDOC is Linda Ackerman. Her husband, Dick Ackerman, is a former California state legislator who works for Nossaman LLP, an Orange County legal and policy consulting firm under contract with MWDOC. Linda Ackerman includes that income source on her 700 forms.
A Seasoned Water Veteran
Cook is skeptical of Foley’s claim that he didn’t think he had to report. “He is a seasoned water veteran. He has received many hours of required training on avoidance of conflicts of interest, and it was common knowledge among his colleagues and MET staff that his wife’s income was derived from the same public agency [MWDOC] that he serves—shame on the entire industry that does not seem willing or able to police its own.”
Based on his impressive resume, Foley would seem anything but a novice when it comes to understanding the rules of water boarding.
He first came to the MET board of directors in 1989 as an appointee of MWDOC. He served as MET chairman from 1993 – 1998 and was elected again by that body to be chairman for a two year term starting in 2011.
From 1979 until Dec. 2007 Foley was also the General Manager of Moulton Niguel Water District in south Orange County. Moulton is one of five water agencies that make up the South Orange Coastal Ocean Desalination Project, a group that plans to build an ocean desalination plant in Dana Point—under guidance from MWDOC and with promised financial assistance from the MET.
Seven months after John Foley left Moulton his wife was warned of a potential conflict of interest with her work on the Dana Point desalination plant because her husband had been involved in that project as Moulton’s general manager. In an e-mail obtained by the Voice, Mary Jane Foley asks MWDOC’s project managers Richard Bell and Karl Seckel what she should do:
“Richard has informed me that since Jack is a signature to the participating desal group from MNWD, I will be perceived as a conflict. Richard said that South Coast will run my contract. How will this all be determined? Do I stop all work and communication with you all now?”
But Mary Jane Foley continued her consulting work with MWDOC, as well as her work as a subcontractor for Byran Buck Associates. And what could have been taken as a wake up call for her husband – to report a potential conflict of interest on his 700 forms – was overlooked, at least until after the Voice forced the issue.
If hands-on experience isn’t the best teacher, then mandatory ethics training every two years also helps water board directors in California to understand their legal and ethical obligations to the public. Chairman Foley completed ethics classes given at the MET in 2008 and 2010.
He would also have received a copy of the MET’s ethics manual for directors, which reminds its readers of two levels of ethical practice. The first is compliance with “relevant laws, rules, regulations and policies” that come with the job. The second is a “level of ethically ideal behavior in which Directors, officers and employees strive to incorporate Metropolitan’s core values in their daily work.”
That work ethic is also spelled out clearly in the MET’s Administrative Code, Section 7102, which, it might be safely assumed, was also presented to Foley for his reading. On the matter of disclosure, it says, “Directors shall comply with applicable laws regulating their conduct, including conflict of interests and financial disclosure laws.”
When the Voice asked Chairman Foley (in September) if he saw any conflict between his support of desalination projects as a MET director and his wife’s extensive work promoting desalination for MWDOC (at that time the Voice was still unaware of the BBA contract), he denied any conflict and said, contrary to public records, that she had “very little” involvement in desalination issues. “I have nothing to do with it [her work],” he added.
Foley was indifferent when asked about a vote he cast—as a director and while he was Chairman of the Special Committee on Desalination and Recycling—for the MET to join CALDESAL, a pro-desalination lobbying organization that public documents show his wife played an important role in forming while under contract with MWDOC.
“Did the MET show me as voting for it,” he asked. “Whether she was involved or not, I would have supported it,” he said, laughing.
Besides, he explained, “It’s not really a conflict of interest. You’ve got to draw a direct line to really make a point of conflict of interest.”
Foley was obliquely, whether accurately or not, comparing his own situation to legal exemptions that are made in cases where the conflict of interest is, in legal parlance, remote.
“You know, I believe in conservation,” he said, rhetorically. “Does that mean I have a conflict of interest because we voted for conservation?”