Thursday, April 14, 2011
In the lexicon of great Monterey County-based financial scandals, what can be said about the Steve Collins desal consulting contract debacle is this: It’s certainly the latest.
Lacking the outright public graft of the circa-2007 Tony Anchundo case (in which the former Registrar of Voters was convicted of embezzling public funds – and did almost no time for it) or the ick factor of tomato titan Scott Salyer’s case (in which the ag businessman is currently under house arrest at his Pebble Beach mansion while prepping for his upcoming federal racketeering trial), Collins has been charged with precisely nothing. Yet.
The Weekly’s Squid first broke the news in March that Collins, a 16-year board member of the Monterey County Water Resources Agency appointed to the seat by the powerful Grower-Shipper Association, had recused himself from voting on a $28 million contract with Walnut Creek-based RMC Water and Environment, an engineering firm hired to consult on the nearly half-billion-dollar Regional Water Project.
The RMC contract was approved. At the time, Collins declined to state why he bowed out of the extremely important vote on an eight-figure expenditure that will be borne by county residents.
But public disclosure laws being what they are, the reason for his recusal became crystal-clear last week. On Collins’ lastest Form 700 – the “Statement of Economic Interest” that forces public officials to reveal sources of income – Collins fessed up and checked the “more than $100,000 box,” acknowledging that RMC paid him more than six figures ($150,000, to be exact) for his services.
In other words, Collins was gaming the system. He advocated for a costly desal project while also advocating for a client nobody (or who knows, maybe somebody?) realized he had, and that client now is on the receiving end of $28 million in public funds.
Collins resigned from the board this week. Smartly.
It’s one thing for the press to cry, “Off with his head,” and another thing altogether for public officials to start asking hard questions.
The Monterey County Board of Supervisors decided to hire outside counsel to take a closer look at the water agency and the desal project.
And the Division of Ratepayer Advocates, the watchdog group that operates under the auspices of the California Public Utilities Commission, on Tuesday gave Cal Am Water 10 days to answer a slew of questions about Collins and his RMC contract.
Among the things the DRA wants to know: what exactly did Collins do for Cal Am subcontractor RMC in 2010, and how much money did RMC pay him? The DRA also wants to know if Cal Am plans to recover any of the costs associated with Collins work as “pre-construction expenditures,” and if any of the costs associated with Collins’ work will be paid for with bond funding – and if so, how much?
RMC principal and co-founders Lyndel Melton says he has yet to hear from Cal Am or the CPUC on the Collins matter. But, he adds, “we don’t feel like we have done antyhing wrong:
Collins contract with RMC ended “because we accomplished what we set out to accomplish, which was to get approval from the PUC,” Melton says.
Other DRA questions that remain include how Cal Am intends to identify conflicts of interest as the Regional Desalination Project moves forward.
And what did Cal Am know, and when?
I paraphrased that last part. But DRA project coordinator Max Gomberg wants Cal Am to answer the very interesting question of when Cal Am officials knew that RMC was paying Collins.
This is the second time in the past 30 days that the DRA has sent an information demand to Cal Am. In late March, the DRA wanted to probe the bond underwriting for the desal project because of reports, in the Weekly and elsewhere, that two investment banks being considered for the project found various reasons that the desal project as currently structured would not succeed.
Cal Am’s figures, as reported in the Weekly, show that a combination of the desal project, removal of the San Clemente Dam and Cal Am’s own ill-timed request for a ratepayer increase could send the monthly bills of every customer – from the most conserving homeowner to the largest hotels – soaring.
What Cal Am knew about Collins’ work with RMA might be irrelevant at this point: the MCWRA board or the Supervisors should move to void that contract.
There’s an old joke: a smart prosecutor could get a ham sandwich indicted. Between Collins, RMC and Cal Am, prosecutors might have an entire pig on their hands.
MARY DUAN is the editor of the Weekly. Reach her at firstname.lastname@example.org.