MEMORANDUM


TO: The Honorable Judge Ochoa, and the 1998-1999 Santa Barbara County Grand Jury   FROM: Goleta Water District Board of Directors

RE: Santa Barbara County 1998-99 Grand Jury Interim Final Report Released June 1, 1999
 

DATE: June 3, 1999

 
INTRODUCTORY COMMENTS



We appreciate this opportunity to provide comments to the Honorable Judge Ochoa, Presiding Judge of the Santa Barbara Superior Court and to the current members of the Santa Barbara County Grand Jury. The comments are directed to the Goleta Water Board Interim Report released June 1, 1999 ("Interim Report"). We have been advised regarding the provisions of Penal Code §933.05 (f) and neither the Interim Report nor these comments will be made public until after release of the Grand Jury’s Final Report. As you know, our General Counsel has requested that the Grand Jury’s Final Report not be released until the Grand Jury has an opportunity to consider these comments. If that request has been accommodated, we express our appreciation. Because of the sometimes harsh tone of the Interim Report, we thought we would begin by pointing out that the Goleta Water Board, as we are referred to in the Report, are five individuals, long time Goleta residents, with families, who have been elected by their constituents, neighbors and friends to represent them in public service for the community. The Board Members perform their public service to the best of their abilities. As the Interim Report makes no allegations of criminal conduct, self dealing nor any other intentional violations of ethical standards, we hope you may reconsider the propriety of the often times harsh tone.
 
 
 
 
 
 
 
 
 
 

We have formatted these comments to follow the Interim Report. We hope that our reference to page number and sections from the Interim Report will be easy for your use.
 
 

Procedure, page 1:
 
 

Comment:
 
 

One of our purposes in this effort to comment on the Interim Report, is to promote the accurate dissemination of information to the public, in particular the Goleta Water District ("District") and the Goleta Water Board’s ("Board") constituents. The reference at the end of this section to consultation with the District Attorney’s office as well as the Superior Court legal counsel suggests professional review and approval of the legal subjects raised in the Interim Report. Our investigation into current local Grand Jury practices suggests that the resources available to the Grand Jury do not allow for the type of professional legal input to the process, that the language of the Interim Report suggests. We feel this gives an unfair and inaccurate level of credibility to the Interim Report. The reference should either be deleted for accuracy or expanded to give proper context. We question whether the District Attorney and the Superior Court legal counsel would be willing to offer their professional legal opinion and the integrity of their public office, to fully endorse the Interim Report in its current draft?
 
 

Background and Mission, page 2:
 
 
 
 

"The Goleta Water District was established as a special district in November 1944."
 
 

Comment:
 
 

The District is a County Water District organized on May 13, 1944.
 
 

Background and Mission, page 2:
 
 

"The special district was formed to establish a legal entity that could enter into contracts with the Santa Barbara County Water Agency (SBCWA) to provide a water supply for the community. Since July 1997, the GWD and its neighboring communities have been connected to the State Water Project by a 144-mile pipeline."
 
 
 
 
 
 
 
 

Comment:
 
 

The District was formed to establish a public agency to provide a reliable water supply to its service area. The District initially produced groundwater, and the Cachuma Project began making deliveries to the District in 1955. After an election by its constituents in June, 1991, the District has participated in the development of the facilities necessary to connect to the State Water Project which include pipelines, treatment facilities and pumping stations. Those facilities were completed in late 1997.
 
 

Open Meetings, page 2:
 
 

"These exceptions are limited to three areas; the discussion of personnel matters, pending litigation, and real estate negotiations."
 
 

Comment:
 
 

The Legislature itself has enacted several "safe harbor" agenda items for closed sessions that are not limited to the three areas identified. Although we recognize that the opportunities to conduct closed sessions are limited and that this sentence may simply be edited back to that statement, we believe this is another example in the Interim Report where the language reflects a bias towards a particular conclusion that is not warranted by the facts or the law.
 
 

Open Meetings, page 2:

"The legislation also requires 72-hour advance notification to the public of a meeting’s location and time as well as all items to be considered at the meetings."
 
 

Comment:
 
 

We simply suggest inclusion of the word ‘regular’ before ‘meeting’s’. We do not believe it is accurate, nor fair to the public to lead them to believe that the District would be violating the law if they noticed a special meeting in accordance with the Brown Act.
 
 

Open Meetings, page 2:
 
 

"The Brown Act recognizes that most legislative bodies conduct much of their business based upon recommendations made by committees composed of less than a quorum of the group."
 
 
 
 
 
 
 
 

Comment:
 
 

We are unaware of legislative findings to support this statement. We recognize that the Legislature has found it important to address the procedures that apply to standing committees. We do not believe that it is accurate to suggest that much of the public’s business is based upon recommendations by committees. In fact actions by the Board are the result of the interaction between District professional staff, committees, the public, professional consultants and ultimately a vote of the full Board at properly noticed Board meetings.
 
 

Open Meetings, page 2, and 3:
 
 

Comments to last two paragraphs.
 
 

Comment:
 
 

The paragraph that begins "The complainants alleged" recites allegations made by complainants and then states that "this could be viewed as an evasion of the requirements of the Brown Act". The same allegations were made to the District Attorney and the District Attorney states:
 
 

"I have concluded that there is no evidence of a criminal violation of the Brown Act by members of the GWB (Goleta Water Board) . . . As such, I have informed the complaining party that no action would be taken by this office in response to the complaint."
 
 
We do not believe it is fair to allow the Grand Jury to express a legal opinion on a question that the District Attorney has refuted and concluded otherwise. The District Attorney has provided the District with no information to suggest that they have an ongoing investigation or that there is any credibility to the complaints that have been alleged.
 
 

The final sentence of the last paragraph of this section is unfair, inflammatory and inaccurate. The District Attorney’s only formal action is reflected in the one page letter dated November 10, 1998 and attached for your reference. There is nothing in the record to suggest that the Goleta Water Board has reason to "repair its public reputation." The Goleta Water Board was elected by its constituents, because we assume of the high regard their neighbors hold them in.
 
 
 
 
 
 
 
 
 
 

Minutes and Agendas, page 3:
 
 

"This approach to the public record of meetings is contrary to actions taken by

most legislative entities and does not reflect the actual GWD proceedings."
 
 

Comment:
 
 

The District Board participates in a statewide agency named the Association of California Water Agencies ("ACWA"). That agency includes as its members a significant number of public agencies throughout the State of California. We question the accuracy of the referenced statement. We do not believe there is credible evidence available to support it.
 
 

Minutes and Agendas, page 3:
 
 

"Incomplete record keeping fails to provide backup for district decisions when clarification of actions is required and subjects the District to potential liability."
 
 

Comment:
 
 

There is absolutely no evidence in the record to support this statement. Over the past eight years, the time period for which the current Board may arguably be held responsible, there has been absolutely no successful litigation against the District, and in fact very little litigation of any sort. Again the language referenced is unfair, inaccurate and inflammatory.
 
 

Financial Reporting, page 3:
 
 

"For example, the Board does not routinely review or approve payment activity by staff. There are no reports regarding the status of payables and receivables or on budget performance or the status of capital accounts."
 
 

Comment:
 
 

The allegations are not true. The Finance Committee meets regularly with the District’s highly skilled management staff to thoroughly review the District’s finances. The Finance Committee reports on the District’s financial condition to the full Board at regular public meetings. All of the Board regularly receives detailed financial statements prepared by the District’s professional staff.
 
 
 
 
 
 
 
 

Financial Reporting, page 3:
 
 

"It was also observed that members of the Goleta Water Board do not attend the presentation of the Annual Independent Auditors Report."
 
 

Comment:
 
 

This is patently untrue as the annual Auditors Report is made at a regularly scheduled noticed public meeting of the Board.
 
 

Financial Reporting, page 3:
 
 

"One recommendation addressed the fact that the District does not bother to reconcile its bank statements."
 
 

Comment:
 
 

At one point in time the District was behind in reconciling its bank statements. That delay has been rectified and bank statements are reconciled on a timely basis. The most recent Auditors Report does not support any of the allegations made in this section. It should be kept in mind by the Grand Jury that times change and members of the Board of Directors change. You have directed your Interim Report to the current Board. We do not believe the allegations made are an accurate representation of the current Board’s performance.
 
 

Reclamation Plant Finances, page 3:
 
 

"Water policy rates and service hook-up fees for reclaimed water are not standardized."
 
 

Comment:
 
 

Not only is this statement inaccurate but the Grand Jury was provided substantial material to establish the opposite finding. Fees and rates for new connections are in fact standardized and we would be happy, if given the opportunity, to demonstrate that fact.
 
 

Reclamation Plant Finances, page 3:
 
 

"Data provided the Grand Jury indicated that rate-making proceedings have not been published or arrived at in public view."
 
 
 
 
 
 

Comment:
 
 

The District’s rate-making proceedings are the subject of an extensive public record, most of which if not all of it having been provided to the Grand Jury during its investigation. Those proceedings were exceptionally closely scrutinized in public meetings particularly by the initial targeted customers, primarily the University of California Santa Barbara and the golf courses in the District service area. The public had a thorough opportunity to review that material at the same time that the potential customers had their substantial opportunity to review it. This statement is one of the most clearly inaccurate in the entire Report.
 
 

Reclamation Plant Finances, page 3:
 
 

"Significant Goleta Water District funds have been spent over the years on water rate studies, yet board members have consistently ignored the expert’s opinion on the subject."
 
 

Comment:
 
 

A fair and close scrutiny of the subject water rate studies will show a reasonably "tight fit" between the consultants’ recommendations and the Board’s final action. This statement is inaccurate and appears intentionally inflammatory.
 
 

Reclamation Plant Finances, page 3:
 
 

"The Goleta Water District did not make a full disclosure of the basis of its rates setting."
 
 

Comment:
 
 

Over the past four years particularly, the District’s rate setting has been closely scrutinized by the public, and actions are taken only at properly noticed Board meetings where the public and the District’s customers had every opportunity to participate. We are prepared to prove those facts if necessary.
 
 

Conflict of Purpose, page 4:
 
 

"Since water is no longer an impediment to development, the Goleta Water District’s involvement in growth management is inappropriate."
 
 
 
 
 
 
 
 

Comment:
 
 

Again it appears that the Grand Jury is targeting the conduct of past Board members. The current Board members have consistently supported a platform to get the Water District out of the politics of land use and they have been successful in accomplishing that goal. During the almost 25 year water connection moratorium, the District was a political focus of Goleta land use issues. Since the moratorium ended, under the direction of the current Board, the Board has completely divested the District of involvement in the politics of local land use and that authority now rests with the County of Santa Barbara, and the Planning and Development Department that the Grand Jury so recently commented on.
 
 

Conflict of Purpose, page 4:
 
 

Last Paragraph
 
 

Comment:
 
 

We recognize that the language of this paragraph cites to the opinion of staff of the Santa Barbara County Planning and Development Department. The District strongly disagrees with that opinion. We believe that it is unfair to fail to include some context and the fact that the District staff and Board members do not agree. It is ironic that immediately after the exceptionally critical report released May 6, 1999 by this Grand Jury regarding the Planning and Development Department, that the Grand Jury would then cite to that same staff’s opinion for an inflammatory, and in our opinion inaccurate statement.
 
 

Conclusion, page 4:
 
 

"During the course of this investigation, the Goleta Water District Board of Directors decided to convert a majority of its standing committees to ad hoc committees."
 
 

Comment:
 
 

This statement is as inaccurate as a statement could possibly be and we are prepared to explain and provide the evidence to support our claim. In fact what occurred at the District’s regularly scheduled reorganization meeting in December, 1998 is that four of the Board’s standing committees that had been long established, were approved to continue. The only advisory committee that was approved and in existence on that date, referred to as the Cachuma Project committee, was authorized to continue. The Board

specifically took the action, at that time, to not authorize any additional advisory committees. Any advisory committees that have been appointed since that time will withstand the strictest legal scrutiny in their propriety and operation. This statement reflects an inappropriate and serious bias that should not be approved. The statement can be proved inaccurate, and to put the credibility of a Grand Jury Report on such a flagrant misrepresentation of fact, should not be condoned.
 
 

Conclusion, page 4:
 
 

"The mission statement for the Goleta Water District focuses on the delivery of water. The Board of Directors has drifted from the specific direction to encompass community development and Goleta governance issues."
 
 

Comment:
 
 

The Grand Jury fails to cite evidence or instances where this Board has been guilty of the allegation. The Board does not believe the allegation has merit. On January 25, 1999 Mr. Monson on behalf of the Grand Jury wrote a letter requesting information on the District’s view on combining special districts. On February 22, 1999 Mr. Kevin Walsh, the District General Manager responded to Mr. Monson’s letter stating in part, "The Goleta Water District has not addressed this issue in recent years." A complete copy of Mr. Walsh’s letter is attached for reference. This current Board has consistently avoided involving the District in community development and Goleta governance issues.
 
 

Responses by Affected Agencies to Grand Jury Reports:
 
 

Comment:
 
 

It appears that this is a standardized attachment to Grand Jury Reports. Particularly for those public agencies that do not have regular legal counsel, the comments made below should improve the Grand Jury process and support accuracy in that process.
 
 

Responses to Grand Jury Reports:
 
 

Comment:
 
 

There is an incorrect citation to the Penal Code. It should be: Section 933(c).
 
 
 
 
 
 
 
 
 
 

"If the report affects an elected official, the official is required to respond within

sixty (60) days."
 
 

Comment:
 
 

This is not an accurate statement of the referenced section. It appears that the sixty day requirement is limited to reports directed to elected county officers or agency heads for which the Grand Jury has responsibility pursuant to Section 914.1. We do not believe that the sixty day requirement applies to any other elected official and does not apply to the Goleta Water Board. We expect the Goleta Water Board will respond in a period shorter than ninety days, and likely much shorter than 60 days, but it is clear that the Penal Code does not require that.
 
 


CONCLUSION



In an effort towards fairness and accurate dissemination of information to the public in our community, we hope that the Grand Jury will seriously consider these comments. We would appreciate the opportunity to meet with the Grand Jury in a forum that would allow for informed discussion, to assist the Grand Jury in achieving an informed and accurate Report. Please contact the District’s General Manager, Kevin Walsh if you are willing to participate in such an effort.
 
 
 
 
 
 
 
 

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