Marina Coast hires spendy defense attorney for its GM, anticipates criminal investigation.
Thursday, July 14, 2011
Marina Coast Water District is like a deer in the headlights these days, awaiting impact but not sure what form the impending disaster will take or how big it might be.
Anticipating the worst – a potential criminal investigation of General Manager Jim Heitzman – the district’s board approved $495-an-hour legal representation for Heitzman. The July 12 vote was part of the board’s seventh meeting in six weeks.
Heitzman is a lead character in dueling reports on a conflict that risks undermining the water purchase agreements that make the $400 million Regional Water Project viable. He’s also a subject of investigations by the District Attorney and the Fair Political Practices Commission. “No evidence has been presented to my knowledge that there is any indication that Mr. Heitzman would have a criminal complaint lodged against him,” said District Counsel Lloyd Lowrey.
But it was at Lowrey’s urging, and a written request from Heitzman, that the board voted 4-0 to approve the agreement with Steven Churchwell, of the Sacramento office of international firm DLA Piper. Vice president of the board, Dan Burns, abstained from voting due to spending concerns, and called for a cap on legal fees.
“It speaks to our obligation as directors that we support our employee,” Board Director Ken Nishi told Burns. “I don’t think you’d be very comfortable if you heard somebody say, ‘We’d put a cap on defending Dan Burns.’”
A preliminary report prepared for the County Board of Supervisors, known as the Remcho report, places Heitzman at the center of brokering a deal between former Monterey County Water Resources Agency board member Steve Collins and RMC Water, which was awarded $28 million in contracts on the desalination project.
A subsequent report prepared for Marina Coast by Jim Markman, an attorney at Richards, Watson & Gershon, absolves Heitzman of any wrongdoing. Markman’s worked for the district for six years, and says he’s confident the water purchase agreements – and Heitzman’s conduct – are legal. But he cautions against considering his report as definitive, because interviews were not conducted as sworn testimony. He has not yet been directed to follow up on his preliminary report.
“We don’t have an agenda,” Markman says. “We just want to build the desal project.”
Board Director Howard Gustafson urged the board, and the public, to back the Churchwell contract: “We need to support our manager, and you need to support your board, unlike the media, which is giving you bad information.”
The board also opted to enter into an agreement with Jeanine DeBacker of San Jose-based Hoge, Fenton, Jones & Appel to represent the district in personnel matters. Marina Coast paid the firm $1,300 last month after DeBacker conducted an investigation into Heitzman’s claim that board member Jan Shriner was creating a hostile work environment.
The board also voted unanimously Tuesday to accept a list of the district’s expenditures for the month of June, which included two RMC invoices for “Program Management of the Regional Desalination Project” totaling more than $1 million, about half of the district’s total payments for the month. The cost will ultimately be passed on to Cal Am’s Peninsula ratepayers.