Supes Stall on RMC Payment
January 11, 2012
By Kera Abraham and Sara Rubin
On Jan. 10, the Monterey County Board of Supervisors delayed a vote to pay the project manager at the center of a major scandal threatening to torpedo the Regional Desalination Project.
An item on Tuesday’s agenda would have lifted a spending cap on the Monterey County Water Resources Agency's line of credit from California American Water. Doing so would allow MCWRA to pay RMC Water and Environment nearly $700,000 for services rendered, $455,000 in other bills, and future costs like permit applications and test well preparation, according to the staff report.
A Jan. 9 letter to the county supervisors from Ag Land Trust attorneys Michael Stamp and Molly Erickson exhorts the supes to reject the line-of-credit proposal. "RMC carried out what appears to be a clearly illegal role on the desalination project, by paying (former MCWRA board director Steve) Collins in violation of state law," the letter states.
At the Board of Supervisors meeting, a dozen members of the public spoke against lifting the spending cap, including North County activist Ed Mitchell, WaterPlus President Ron Weitzman, LandWatch Director Amy White and businessman Nader Agha, who is proposing his own desal project.
Ron Chesshire was the lone public voice in favor of lifting the spending cap, warning that MCWRA could be in default if it breaks the terms of its Regional Project agreements. “If you don’t move forward I imagine you’re going to be in a big legal tussle," he said.
County attorney Charles McKee backed up his concerns, saying RMC should be paid as long as the agreements are in effect.
Supervisor Lou Calcagno was not present, but his aide read a letter expressing Calcagno's opposition to the resolution. “The items before you today would allow more expenditures on a project that has already [incurred an]…unreasonable financial burden," the letter stated. “Any future negotiations regarding RMC should be tabled."
At a motion from Supervisor Jane Parker, the board voted 4-0 to delay a decision on lifting the credit cap, pending a more thorough staff report from MCWRA with itemized expenses, and information from county staff about the fiscal impact of defaults.
Supervisor Simon Salinas voiced his disappointment that the Regional Project seems to have lost the wide political support it once had, given the urgency of the Monterey Peninsula's water-supply needs. “Unfortunately, I’m sensing maybe we do need to take a week or two," he said.
"I'm in favor of paying the bills, but I'm not in favor of paying the bills I can't see," Supervisor Dave Potter added.
They'll revisit the issue at their next meeting, Jan. 24.
Stamp's letter also asked the board to reject a related agenda item regarding a county application for a state revolving loan to fund the Regional Project. The supes, however, voted 4-0 in favor of allowing MCWRA to proceed with that application, to the tune of $62,000.
"Approving this resolution doesn't mean the floodgates are open," said David Chardavoyne, MCWRA's interim general manager. "It will allow us to pay for services rendered and proceed with the Coastal Commission permit application and apply for the state revolving funds."
McKee said there's urgency to pursue the revolving fund because of its attractive interest rates. Doing so is "putting the county WRA in the best position possible," he said. "That position is being able to act immediately, should we come out of mediation and the agency is still a party to the Regional Water Project."
In other desal news, six Peninsula mayors have proposed forming a joint powers authority that represents competition for the Regional Project. Each city council will weigh in on the proposed JPA over the next two weeks, beginning last night in Carmel and ending in Del Rey Oaks Jan. 24.
The Peninsula JPA marks a change in direction from earlier visions to partner the cities with Monterey Regional Water Pollution Control Agency and/or Monterey Peninsula Water Management District.
The mayors say their JPA would give Cal Am’s Peninsula ratepayers greater representation in the governance of the Regional Project, and/or an alternative water supply project.