Ed Mitchell Media Conference: July 1, 2011

(For the complete original document – click here.)

My name is Ed Mitchell co-founder of the Prunedale Neighbors Group. The majority of county employees are honest and work hard each day to deliver excellent service to the public. Many are union members who have voluntarily taken pay cuts yet still worry whether they will be fired during this recession.

Unfortunately disturbing facts have caused the media to raised serious questions about the conduct of Mr. Steve Collins. AS a Director of the Monterey County Water Resources Agency did he break State law for personal gain while he lobbied county and state decision makers to approve the half-billion dollar Regional Desalination Water Project?

I’m here to call for a quick, broad, and transparent investigation NOT ONLY of Mr. Collins but of five additional senior public officials who repeatedly participated with Collins in dozens of meetings shaping the desalination settlement and water purchase agreements as well as the selecting and funding the private company given a $28 million dollar contract to be the Program Manager of the desal project. That private company is known as RMC.

So Today I’m here to provide:

 Facts about how we got to where we are,
 and recommend where we need to go to restore public trust in our county government.

How’d we get into this scandal?

State laws have existed for over 35 years to discourage public officials from taking advantage of government contracts to make a lot of money at the expense of the taxpayer. Two of those laws are the Political Reform Act of 1974 and Government Code 1090. Those laws are the ones that laws that appear to have been violated in 2010 by Mr. Collins and possibly one or more other public officials.

Last year when the desalination agreements suddenly popped out of closed-door meetings the public had just a week to review those contracts and make comment on their adequacy before the Board of Supervisors approved them on April 6th 2010.

After reading and re-reading the Water Purchase Agreement I found it to be a sweetheart deal for CalAm, for the Marina Coast Water District and the Monterey County Water Resources Agency. All the risks of the project and all the cost were assigned to the peninsula ratepayers while all the benefits went to the 3 county agencies that formed the joint partnership to build and operate the project.

I’ll give you just one example of how bad this sweetheart deal was. After the ratepayers paid off the half-billion dollar mortgage would they own the desalination plant? No, Marina Coast Water District would. How would you like to pay off a 30-year mortgage for your house and then find out that the plumber owns the house – not your family?

But in my opinion there was another dangerous fatal flaw in the Water Purchase Agreement. There was no provision to ensure integrity in contracting. In fact the way it was written a public official could shape the contract for the benefit of whatever private company would deliver the desal plant then once the project was approved they could quit working for the county and get hired for a huge salary by the private company.

During public comment on April 6th, I supported the desalination solution but argued against the water purchase agreement because its fatal flaw did not protect the public’s pocketbook.

From review of invoices submitted by Mr. Collins to the Marina Coast Water District, we now know that months earlier for his own financial gain Mr. Collins had already done what I had predicted could be detrimental to Monterey County residents. He had become a high paid agent for RMC, which was seeking to get contracts to perform desalination work.

And at that April 6th review, Mr. Collins, Curtis Weeks, and Deputy Counsel Irv Grant as representatives of the MCWRA jointly briefed the Board of Supervisors to approve the desalination agreements. For that day’s work Mr. Collins’ billed RMC for 6.7 hours of effort in attending the Board of Supervisors closed and open meetings. That billing appears to show which organization Collins felt he was working for while presenting himself to the public as a MCWRA Director. It was RMC.

But today’s focus is not on Collins but about what other County officials did or didn’t do. But figuring out those answers is like solving a complex jigsaw puzzle where the many pieces are hidden in public documents, which are buried in many different locations or databases containing events that occurred at many different times. It’s a hard problem to solve unless you have the jigsaw puzzle box top.

To help solve this problem I built and provided to the Board of Supervisors a diagram of the timeline giving insight into who knew what when? This timeline includes information taken from public records about the apparent behavior of Mr. Jim Heitzman the General Manager of MCWD, Mr. Curtis Weeks General Manager of the MCWRA, Deputy Counsel Irv Grant, County Counsel Charles McKee and the Board of Supervisors.

We don’t have time to discuss the whole diagram. Instead here are example insights on the apparent behavior of two individuals.

Mr. Heitzman asked RMC to hire Collins. Invoices show he spoke with Collins on January 9th 2010 apparently about the RMC scope of work. In August 2010 an account manager spoke to Heitzman questioning the payments to Collins. So its not unreasonable to assume that Mr. Heitzman knew for months that Mr. Collins had a financial agreement and therefore a conflict of interest because of his employment to RMC. Meanwhile Mr. Heitzman participated in dozens of meeting with Mr. Collins seeking approval of the desalination project.

Mr. Weeks on the other hand for sure knew on September 27 2010 that Mr. Collins had a conflict of interest because of Collins’ on-going financial agreement with RMC. That day Collins recused himself from voting on an issue related to RMC during a MCWRA Board of Directors meeting that Mr. Weeks and Mr. Grant attended.

But apparently no time during 2010 did Mr. Heitzman or Mr. Weeks take any action to prevent Mr. Collins from continuing to participate with them in meetings to influence decision makers about the desalination project. Some people might consider such behavior as aiding Mr. Collins in violating the Political Reform Act of 1974.

After the Board of Supervisors received this jigsaw puzzle box top timeline the Herald reported that “Supervisor Calcagno said he doesn’t believe the county’s investigation needs to address who at the county knew about the nature of Collins’ relationship with RMC and when…”

But doesn’t it seem clear to you that just the opposite is true? Doesn’t the public deserve to know if just one individual or many caused this scandal? Thats why on June 29th I delivered a sworn complaint and evidence package to the Fair Political Practices Commission requesting they investigate if Mr. Heitzman, Mr. Weeks, Mr. Grant, Mr. McKee, or Mr. Calcagno may have purposely or negligently caused or aided and abetted Mr. Collins in multiple violations of the Political Reform Act of 1974 as many public documents seem to suggest.

Now some people commenting on this scandal in my opinion seem to claim that no one has been hurt by Mr. Collins’s behavior or the behavior of any public official. Unfortunately the opposite is true. Here are two quick examples of significant harm which I included in the sworn complaint:

Number 1: Monterey County Tax payers are now paying hundreds of thousands of dollars for costly independent investigations and District Attorney investigations. In these tough economic times that may mean that the County will have to fire two or three or more union employees. That’s hugely significant those unfortunate families.

Number 2: Monterey Peninsula ratepayers will pay for any increases in the interest charged by investment banks funding the Regional Desalination Project. Even a half-point interest increases across the life of the desalination plant’s construction and operation contract will amount to tens of millions of dollars in unnecessary costs to ratepayers.

So Where do we Need to go from here?

We need quick and transparent investigations by the independent investigator and the District Attorney. The public deserves to know if public officials are exonerated or found to have broken state law.

If any officials have broken the law they need to be held accountable and sanctioned according to the severity of their violations, no matter how high they sit in county government.

Plus the public deserves to hear from the other public officials. They should explain why they behaved like they did – which appears to include not stopping or reporting Mr. Collins from making violations of the Political Reform Act of 1974 when they knew he had a financial conflict of interest.

Example of a good public Servant:

Now it’s not fun presenting information that public officials may have let down the public’s trust. So I want to end by recognizing a public servant who deserves appreciation for her integrity and for her courage.

That person is Ms. Jan Shriner. She is the first woman elected to the Marina Coast Water District in decades. This spring, coincidentally after she requested that General Manager Heitzman provide documents about the Regional Desalination Project, he claimed that she had created a hostile work environment.

His allegation caused the MCWD Board of Directors to initiate a legal investigation of the allegation. This subjugated Ms Shriner to a difficult scrutiny. The result was that the legal investigator found she had not violated any laws nor created a hostile work environment when asking for documents within her role as a observant, concerned director.

Mr. Heitzman’s involvement in the Collins scandal raises questions about his complaint. Was it an attempt to silence her or block her from discovering the truth? Other people than me are asking this question.

The public should be proud of Ms. Shriner’s determination to do her job in a diligent manner. In my opinion, if other public officials had behaved more like her — then the County would not be in such an expensive scandal.

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References and Documents:

Ed Mitchell’s News Conference at Monterey County July 1, 2011 – Complete text

Ed Mitchell Report – listing who Collins billed, met with and when – starting in January 2010.

Collins Investigation Should Catch Other Officials.
by Ed Mitchell

Salinas Californian article – Front page Saturday July 2, 2011

Marina Coast Water District Preliminary Report Denying Guilt of their General Manager Jim Heitzman or the Board