Wednesday, October 30, 2013

Superintendent Caples finds fault in Siskiyou County Grand Jury report

By David Smith, Siskiyou Daily -

Superintendent Bryan Caples submitted his responses to the 2012-2013 Siskiyou County Grand Jury report Friday, revealing an overall sense of frustration with the findings and recommendations provided in the report.

According to the report, the grand jury elected to perform a watchdog investigation of the SVUSD in an effort to review the results of the 2007 consolidation of Scott Valley’s various school districts.

The report provides a general overview of the SVUSD’s history and current operations, as well as a number of findings and recommendations.

“During the Civil Grand Jury Watchdog Investigation of the Scott Valley Unified School District, it became clear that there were a number of problems and issues that need to be addressed,” the report reads.

The findings and recommendations cover district policies and procedures, school board members, truancy rates and student tracking, issues with parents, student drug and alcohol use and crisis management practices.

“I first read the report and I was confused,” Caples said in an interview Friday, “because there were things in there we were already doing, or things we have no control over.”

The report suggests that the school board would benefit from the addition of an individual with teaching or administrative experience, saying that the board “lacks someone who understands the more complex issues regarding school administration and educational programs who can review the budget and other accountability documents and understands what is going on behind the scenes.”

Noting that the SVUSD has no legal authority to require teaching experience on the board, Caples said, “I felt that this finding was offensive to the people on the board because they do a dynamite job.

“They love the kids and our community and they are qualified to be on the board.”

The report also states that the jurors heard complaints that some parents enable inappropriate behaviors and that drug and alcohol abuse is rampant in the valley schools.

“According to some community experts, 90 percent of the high school students are drinking and smoking marijuana. Often students attend classes under the influence,” the report states.

Caples disputes the veracity of the report in its finding, stating that annual anonymous self-reporting surveys do not come close to 90 percent of the student population using drugs and alcohol.

“That was really frustrating to our community members, and I feel it was offensive that it was printed as factual,” Caples said.

In other findings, the report recommends that the school district continue conducting business as it has, but Caples said he feels that the inclusion of those findings in the report suggests there are problems that the district is not fixing.

“I’m just more frustrated than anything,” Caples said. “I think that the report hurt a lot of feelings in the community.

“Maybe more investigation would have helped clarify some of these issues,” he concluded.

Caples submitted his responses to the report on Friday.

Monday, October 21, 2013

WaterPlus Sues DeepWater Desal, Water Management District, Asks (Monterey County) Grand Jury to Investigate

Posted: Friday, October 18, 2013 5:37 pm

Remember those two other desalination projects?

California American Water's moving forward with test wells, but DeepWater Desal and the People's Project Moss Landing Water Project are also still both in the running with desal proposals of their own.

DeepWater Desal, based in Moss Landing, won up to $1 million toward environmental review from the Monterey Peninsula Water Management District, back in March. Those funds came even though the district is backing the mayors' water authority in supporting Cal Am, as a contingency plan. Even though the water management district described its contribution to DeepWater as a back-up plan if Cal Am fails, public water advocacy group WaterPlus doesn't see it that way.

The group filed suit Friday in Monterey County Superior Court against DeepWater Desal and the water district, arguing the cost-sharing amounts to favoritism and violates the California Environmental Quality Act.

The agreement, "coupled with financial support, public statements, and other actions by [MPWMD] public officials, constitutes approval of a private project," the lawsuit states.

The group is asking a judge to toss the cost-sharing agreement. DeepWater Desal CEO Brent Contantz and water management district officials were not immediately available for comment Friday afternoon.

WaterPlus President Ron Wietman also submitted a request to the Monterey County Civil Grand Jury to investigate the collapse of Cal Am's prior project, the Regional Water Project.

He asks the Grand Jury to look at not just the DeepWater deal, but also the county's capitulation to Cal Am in agreeing to not enforce its ordinance requiring public ownership of desal plants, as well as issues around Steve Collins, the former Monterey County Water Resources Agency official facing conflict of interest charges that tanked the old project.

Thursday, October 17, 2013

(LA) City officials justify lawyer salaries

By David Mark Simpson, Santa Monica Daily Press -

Santa Monica has more high-paid staff attorneys than any municipality in Los Angeles County, according to a recent report.

In 2011, the city was paying 17 legal department employees more than $200,000 per year, compared to Los Angeles’ 11 — the second most in the county.

That’s according to the 2012-13 Civil Grand Jury Final Report. City Manager Rod Gould said the report was flawed for a number of reasons, but did acknowledge that Santa Monica pays well — a decision he stands by.

Several senior attorneys have retired since City Hall submitted salary information to the county.

In the 2012-13 fiscal year, City Hall paid 14 legal department employees more than $200,000. Another nine employees made more than $100,000. City Attorney Marsha Jones Moutrie was paid $300,120, according to documents provided by city officials.

“We are a full service city that undertakes a uniquely broad range of activities,” Moutrie said in an e-mail. “They include operation of a bus line, an airport, water wells, and various public facilities and venues. And, the city provides an exceptionally broad range of services to residents, including services from this office that protect the rights of tenants and consumers.

“Likewise, the [City] Council has chosen to adopt a number of rather complicated and/or unusual local laws that protect residents and their quality of life,” she added. “This office enforces many of them, but it could not do so without experienced prosecutors and civil enforcement attorneys.”

When Gould came to Santa Monica, he thought: “Why are we running a medium-sized law firm on the third floor at City Hall?”

The attorneys act as prosecutors, offer consumer protection, fight for tenants and have a criminal division, he said.

“You can do it through your own staff or you can hire outside attorneys at an hourly rate,” he said. “The hourly rate includes their salaries, their partners’ salaries, the overhead rent in their office buildings, their insurance, their taxes, and everything else that goes into running a law firm.”

He called the attorneys “a bargain” in comparison to the private sector. He said that each city is run differently, pointing to the in-house trash collection provided by Santa Monica.

“Doing it slightly differently doesn’t make it wrong,” he said.

Mayor Pam O’Connor said the salaried lawyers allow City Hall to act aggressively on behalf of taxpayers.

“In general, we are seen as an affluent city so people go after us frequently,” she said. “In addition, we are a progressive city so sometimes people challenge our policies. We need good lawyers to back our progressive ideals.”

She, too, pointed out that salaries are less expensive than contract work in the long run.

Gould said that City Hall has never performed a study to see if it is more efficient to use in-house or private lawyers. He said that when City Hall occasionally needs specialty legal council it learns that the costs are “astounding.”

“Just on that spot-checking that we do periodically I get the sense that we are doing it right,” he said.

Gould pointed to, among other cases, legal victories against major industrial polluters that saved City Hall hundreds of millions of dollars.

Monday, October 7, 2013

(Orange) CalOptima Board Approves Bonuses and Raises for Execs

By TRACY WOOD, Kitsap Sun -

The CalOptima board of directors last week voted to award a one-time $26,775 performance-based bonus to CEO Michael Schrader, who, after nearly two-dozen resignations of key staff, has been trying to rebuild the $1.5 billion county health plan for low-income, elderly and disabled residents.

The CalOptima board also awarded a permanent 4 percent “merit” salary boost to the health plan’s general counsel, Gary Crockett, raising his annual base pay to $214,240, despite questions by the county grand jury and controversy this year over board members not recusing themselves when they may have had a conflict of interest.

Board members apparently weren’t instructed on state conflict of interest laws or advised when they should recuse themselves from voting, duties that in other agencies are performed by the lawyers.

The state’s Fair Political Practices Commission is investigating conflict of interest issues involving all 10 of the CalOptima board of directors as well as four of the five county supervisors. A special FBI task force also is investigating public corruption in Orange County and, according to individuals who said they have been interviewed, agents asked questions about, among others, Supervisor Janet Nguyen, the Board of Supervisors’ representative on the CalOptima board.

Nguyen, with support from two other supervisors, scrapped the previous CalOptima board of directors in favor of a new one dominated by representatives of the medical industry and the county. In the past she strongly opposed the type of performance-based one-time payment that Schrader received, but she didn’t attend Thursday’s meeting. Her office declined a request to interview her.

In addition to the two salary issues, CalOptima board Chairman Mark Refowitz, who also heads the county Health Care Agency, gave board members a heads up Thursday about a pending federal audit of the Medicare portion of CalOptima’s operations. Known locally as OneCare, the program provides Medicare and Medi-Cal benefits for about 15,600 low-income, elderly residents.

The number enrolled in the program is a small portion of the nearly 469,000 total CalOptima “membership,” but health plans that perform exceptionally well, compared to other plans, and earn four or five stars, receive higher federal payments, an incentive for lower-performing plans to do better. In addition, there is a prestige factor, with highly rated plans able to stand out nationally.

The financial incentives are designed to force health plans to provide high quality care and not waste tax money.

In the past, CalOptima has been one of the highest performing health plans in the state.

But Refowitz predicted CalOptima may not get high ratings this year. He indicated lower marks would be due to a higher level of scrutiny, not an actual drop-off in performance.

“We shouldn’t be shocked if they (auditors) come in here and really start kicking the tires,” Refowitz warned. He said board member Dr. Samara Cardenas, a pediatrician, will represent the CalOptima board in talks with the auditors.

The audit was supposed to start Monday but has been delayed by Congress’ federal worker shutdown.

Refowitz also said CalOptima finally may be filling the only seat on its 11-member board reserved specifically for a participant in the health plan. Five seats are held by the medical industry, three by county employees, including Nguyen, and two by individuals who have no connection or background in health care.

The seat for a plan participant was specifically created in January 2012, when Nguyen’s changes in the board went into effect, but never has been filled.

Even when it is, more than 60 percent of the health plan “members” will have been blocked from applying because they are under 18 years old and their parents aren’t allowed to seek a position on the board.

“Please note that parents of minor children receiving services through CalOptima do not qualify per County Ordinance,” says the recruiting announcement on the county’s web site.

Executive pay incentives became an issue during the summer of 2011 when the former CalOptima board said then-CEO Richard Chambers had met performance criteria spelled out in his contract and was legally entitled to a performance-based bonus that, along with a car allowance, raised his annual pay to $515,743, according to the Orange County Register. Based on similar contract criteria, nine other executives under Chambers received performance payments ranging from $20,700 to $67,000.

CalOptima board members said the financial incentives were necessary because private industry and other health organizations paid its executives far more.

At the time, Nguyen strongly criticized the payments. But last year, after the departure of so many key executives to private industry and jobs with other government organizations, the new board she had created approved a series of “retention bonuses” intended solely to keep even more executives from leaving.

Under that plan, executives received a bonus if they just agreed to stay through a certain date. Voice of OC, under the California Public Records Act, has requested a list of all retention bonuses that were paid out under the plan.

Schrader’s performance-based bonus of 8.5 percent means a onetime addition of $26,775 to his $315,000 annual salary.

In spite of calling Crockett’s permanent four percent salary bump a “merit increase,” CalOptima officials said the phrase is a generic description for general pay raises and the amount was in line with overall increases given to most of the staff.

Crockett has been at the core of a number of controversial CalOptima issues since 2011.

According to the 2012-2013 Grand Jury report “CalOptima Burns While Majority of Supervisors Fiddle,” in early 2011, “a CalOptima lawyer made more than 100 allegations against CalOptima’s senior executives prompting the CalOptima Board of Directors to commission an outside legal firm to conduct an investigation.”

Ultimately, there were three reports presented to the board based on accusations made by Crockett. The reports, known as the Theodora Reports because they were done or commissioned through Nguyen campaign donor, Costa Mesa lawyer Todd Theodora, never have been made public. But copies reportedly have been obtained by federal and state investigators.

In its report, the grand jury said the Theodora reports determined “none of the CalOptima lawyer’s allegations were founded and that he retracted over 50 allegations prior to any executive interviews.”

Crockett declined last week to discuss his allegations and the Theodora reports. “It’s subject to attorney-client privilege,” he said. “That’s all I can say about it.”

When asked about the four percent raise for Crockett, Refowitz said “Gary does a remarkable job managing our litigation” and outside law firms.

Tuesday, October 1, 2013

Water company: Kern grand jury libeled us

BY LOIS HENRY, The Bakerfield Californian -

The Kern County grand jury was accused on Monday of libeling a local water district.

Oildale Mutual Water Co. took the first step toward a libel lawsuit by filing a claim against the county. It accuses the grand jury of making numerous false statements about Oildale Mutual, its general manager and its directors.

Among other defamatory statements, the claim asserts, the grand jury wrote that Oildale Mutual had lost $1.5 million each of the past three years, that it had deteriorating infrastructure and that some of its directors have not paid "hook-up" fees for homes built in Oildale.

A claim is the first step to suing a government agency.

Terry Wolfe, the grand jury foreman, declined to comment.

The Oildale Mutual report, which was released June 17 and is still on the grand jury's website, was written by last year's grand jury. Wolfe and five other jurors from last year remain on this year's panel.

Wolfe declined to say which jurors were on the ad hoc committee that wrote the June 17 report.

Deputy County Counsel Devin Brown, who reviewed the report before publication, said he couldn't comment on what advice he gave the jury as that's protected under its attorney-client relationship with the grand jury. He did acknowledge that comments made in grand jury reports are not privileged, or protected from liability.

The civil grand jury routinely issues reports that are assessments of the work done by government agencies. It this case, the grand jury report detailed a decades-long feud between Oildale Mutual and the North of the River Municipal Water District (NOR).

Its conclusion was that both entities should be audited and that they should be consolidated into a new Community Services District.

But why the grand jury delved into this situation at all was baffling to both Oildale Mutual, a private company, and NOR, a public special district.

In particular, Oildale Mutual was incensed by the report's statement that "It was reported to the grand jury some OMWC directors do not pay 'hook-up' fees for homes built in Oildale."

In its Aug. 15 response, Oildale Mutual wrote: "It was bad enough that the grand jury wrongly accused the staff and directors of OMWC of mismanagement based on anonymous and unattributed 'reports'; now it goes so far as to accuse them of what amounts to criminal misconduct (e.g., theft, fraud, embezzlement, or the like). The finding is totally, absolutely and completely false.

"OMWC believes that the accusation is tantamount to libel or slander."

The grand jury has no jurisdiction over a private company and only limited jurisdiction to review NOR's operational procedures.

Both water entities have made that clear in their responses to the grand jury report. Only NOR's response has been put on the grand jury's website.

While NOR's response allows that the grand jury may have authority to look at the district's operations, it says the jury "exceeded its statutory authorization" when the jury discussed a proposed consolidation of some operations between Oildale Mutual and NOR.

Oildale Mutual's response, sent Aug. 15 to the Kern County Superior Court presiding judge, who advises the grand jury, has not been posted, nor has anyone from the county responded to it, according to Oildale Mutual General Manager Doug Nunneley.

It was in that 20-page letter that Oildale Mutual first brought up the issue of libel and demanded a full retraction.

The letter also notes that no one from Oildale Mutual was contacted by the grand jury prior to the report being published and that when errors were brought to the jury's attention, it refused to correct them.

That includes the incorrect statement that Nunneley's father is a newly elected NOR director. Nunneley's father has been dead for five years.

When he called the grand jury forewoman right after the report was published and pointed that out, he said the response was "Dead silence.

"I said, 'Well it looks like you really did your homework. Thanks a lot.' What else can you say at that point?"

Oildale Mutual's claim doesn't list exact damages being sought, and Nunneley said that's not known at this point.

He did note that Oildale Mutual is in negotiations with another company over water quality on one well. The report, which Oildale considered damaging to its reputation, was issued at a time when settlement talks were underway. The other company mentioned that it was aware of the grand jury report.

"So, it's out there," he said of the report. "And it's potentially hurting us."

Libel suits are difficult to prove under even in the most straightforward circumstances.

When you throw in the grand jury, things get even trickier, according to libel attorney Thomas Burke with Davis Wright Tremaine in San Francisco. (Burke often represents The Californian in legal matters regarding news reports.)

Because the grand jury is a citizen watchdog organization, an anti-SLAPP motion might be a logical first line of defense, Burke said.

SLAPP stands for "strategic lawsuits against public participation," and is meant to protect public speech when that speech criticizes a government entity.

Beyond that, Burke said, Oildale Mutual will have to prove the grand jury knowingly, or recklessly, disregarded the truth in making false statements about the company. That's known as "actual malice" and it's tough to prove.

Even the fact that no one from Oildale Mutual was contacted by the jury isn't necessarily proof of malice, Burke said.

"If the jury had reason to believe directors were getting free accounts, and I'm just speculating here, they might not have contacted them for fear the behavior would change and evidence disappear," he said. "It's a different standard when you're talking about an investigative body and how they wrote, or should have written, a report. Because you don't want a grand jury to pull back" on its watchdog role.