A special service district board formed by two Grand County commissioners after their failed re-election bids is raising questions of propriety.

A task force has been formed by Grand County Democrats to look into actions taken by former Commissioners John Zimmerman and Jimmie Walker, both Republicans, who were defeated during last November's election.After the election, the two were joined by fellow Republican Commissioner David Knutson in appointing Zimmerman to a new district road board the commission formed in November.

The appointment conformed with recommended guidelines, but Zimmerman's continued membership appears now to violate rules because he no longer is a commissioner.

The commission also formed a recreation district before Walker and Zimmerman left office, but no commissioner was named to that board although commission representation was suggested in guidelines on formation of special districts to be funded by mineral lease money.

The Democratic task force is also questioning the manner in which Ollie Knutson was named a member of the road board.

The two outgoing commissioners backed a motion and vote by fellow commissioner Knutson to appoint Ollie Knutson, his father and business partner, to the three-member board. Moab businessman Robert Shumway is the third member.

Commissioners Knutson, Zimmerman and Walker first announced intentions to establish the special service district last September, to oversee use of funds newly available for road programs under amended legislation affecting the federal Mineral Lease Act.

A bill passed by the 1988 Utah Legislature allowed creation of independent service districts that eventually are to receive about 25 percent of all mineral lease money allocated to Utah.

Some $2 million is scheduled for distribution by June 30, the end of the current fiscal year. That allocation will increase to $4 million the next year and $6 million in 1991. The 25 percent allocation method is scheduled to go into effect in 1992, and projections are that distributions then could reach as high as $9 million.

Grand County will receive about 5 percent of the total state allocation - about $450,000 annually within four years.

Grand County commissioners formed the road district Nov. 14, just six days after Zimmerman and Walker were defeated in a hotly contested race that focused on the commission's support for a hazardous-waste incinerator in Cisco, 45 miles northeast of Moab.

That project was killed when voters in a referendum repealed the zoning approved by the commission allowing the development.

Both the resolution and guidelines for establishing a special service district say the County Commission shall appoint one of its members to the road board. But former commissioner Zimmerman said that he believes there is to be no commissioner on the board, to preserve the district's political and financial independence. Knutson agreed.

Zimmerman said his involvement while still commissioner stemmed from the need to get the district established. "We were trying to get things organized. We had to get things moving along," he said. "I wasn't commissioner in spirit; I was in body. I just felt like I was trying to do a little community service."

Mark Walsh, Utah Association of Counties associate director, said counties were encouraged to appoint a commissioner to the road boards. Of the nine counties that have formed districts, all but Juab County did. Some counties named commissioners who ended up losing.

In Grand County, Zimmerman continues to serve on the road board, and new Commissioners Merv Lawton and Ferne Mullen, both Democrats, have not forced action on the appointments.

In January, Walker was hired by the road board as administrator at $1,042 per month. The board hired him initially Jan. 6 as a paid lobbyist to the Legislature at $100 per day plus expenses. On Jan. 19 he was picked ahead of two other applicants to be district administrator.

Knutson said he supports Walker's hiring as administrator, believing Walker is the best person for the job. Knutson also defended appointing his father to the board, believing that Ollie Knutson was one of the most qualified applicants.

The administrative board for the road district has approved a $35-per-meeting compensation plan for members, plus mileage reimbursement at 24 cents per mile.

Lawton, current commission chairman, apparently is no longer concerned over the board or district administration, and he has dropped the question of naming additional board members.

"I'm not going to do anything at this stage. I don't know that there's any need at this time," Lawton said.

"I don't get paranoid like some people . . . who think because Dutch (Zimmerman) is on the board and Jimmie (Walker) is administrator that it's automatically going to be bad. They can't afford to be bad. There are stringent rules they have to abide by. If they make boo-boos, they nail themselves to the cross."

Mullen sees it somewhat differently. "The way they went about it - I don't know how ethical it was."

Mullen said she is seeking advice from the Utah Association of Counties and other sources, to ensure that Grand County does not lose its funding eligibility.

The Grand County roads district announced last month its first special project this month. The road board plans to work with the Uintah County district to pave a 100-mile connector road in the Book Cliffs mountain range between Cisco and Vernal. Cost is estimated at $6 million, and permission will be required from the Uintah-Ouray Indian Reservation.