FBI investigation draws attention to California's water districts

By Michael R. Blood

Associated Press

Published: Saturday, July 6 2013 12:00 a.m. MDT

Mike Machado, a former Democratic state senator from Linden, in the Central Valley, recalled working with other lawmakers a decade ago to change the makeup of two district boards, the Central and West basins in the Los Angeles area, to counter concerns about cronyism and high water fees.

Machado, now executive director of the Delta Protection Commission, said water districts provide plum jobs that often are passed around between family and friends. They also become politically powerful fiefdoms that are resistant to change.

"Most of these have pretty good salaries, medical benefits and retirement (pensions). The seats are basically passed down, not necessarily opened up unless someone wants to be aggressive. If you become aggressive, it pits neighbor against neighbor," he said.

Investigations over the past decade, including ones by the Los Angeles Times and The Sacramento Bee, found that ratepayers' money has gone to flying lessons and foreign trips for directors, prime rib and shrimp at swearing-in ceremonies, thousands of dollars for meals, tickets to Los Angeles Dodgers baseball games. As in many other public agencies, employee pensions also have been padded.

In 2005, two members of the West Basin's board were sentenced to federal prison for taking bribes and kickbacks in the awarding of local government contracts.

More recently, the state attorney general weighed in on conflict-of-interest concerns involving Willard Murray, who served simultaneously on West Basin and another water board. The attorney general forced him to leave one position, but it's still a family affair: the board's current vice chairman, John W. Murray Jr., is Willard Murray's second cousin, said Metropolitan Water District spokesman Bob Muir.

When he was a member of the state Assembly, Willard Murray carried legislation in 1995 that allowed members of a public agency to appoint themselves to the board of a metropolitan water district and to vote for their own appointment to the district board. The bill eventually became law.

He drew media attention in 2008 after one district paid him nearly $90,000 over two years to attend meetings and for travel that included a trip to Mexico City.

In the Legislature, efforts to bring greater scrutiny to local water districts have flopped, at least in part because of insider influence.

"They have a lot of money so they're able to hire good lobbyists or spread money around," said Joe Canciamilla, a former Democratic assemblyman from the eastern San Francisco Bay Area city of Pittsburg who now is Contra Costa County's clerk and recorder.

State Controller John Chiang is pushing two bills to bring greater accountability to local water districts, including one that would stiffen penalties if they fail to provide required information on salaries and other financial records.

State records filed with the controller show that six-figure paychecks are common in many local districts — even among smaller ones.

Seventy-one people worked at the Mesa Consolidated Water District in Orange County in 2011, records show, and about a third of them made more than $100,000 a year. The general manager was paid $254,000.

In the Santa Clara Valley Water District, which had 773 workers in 2011, average wages were nearly $110,000. The chief operating officer reported total wages of more than $330,000.

Little has changed since a state audit released in 2004 sampled the practices of eight of the state's nearly 450 water districts. Auditors found five of the eight had financial reserves so large that they raised questions about whether money should be returned to ratepayers, while three paid their directors to attend questionable events including retirement, anniversary and holiday celebrations.

Part of the problem is no one bothers to look.

"As long as people can turn on their water or turn on their irrigation tap, they're happy," said state Sen. Lois Wolk, D-Davis.

Thompson contributed from Sacramento. Associated Press writer Greg Risling in Los Angeles contributed to this report.

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