AWA Directors Spending Ratepayer Funds at an Astonishing Rate
We can rest assured that our water rates will be going up. AWA directors have wasted the money from the rate increases they took in 2015. That last increase was supposed to be good for 5 years (until 2020) and it’s only been a little over a year now. Here is how they are misusing our rate money:
Directors use public funds to cover their illegal actions.
All five directors agreed to use our rate money (about $18,000) to pay for an illegal letter to oppose the rate referendum in 2015. Then, when a ratepayer reported them to the Fair Political Practices Commission (FPPC) the directors hired a legal firm using our rate money to protect them from being personally fined. That firm was able to convince the FPPC to fine RATEPAYERS $3,000 for the actions of the directors!
It takes nearly two General Managers to run the Agency?
Yes it does. Eight years ago, the agency had 63 employees and only one General Manager (GM) and no assistant GM. In 2009, the staff was reduced to 42. The Board created an assistant GM position and just recently gave the Assistant GM a huge pay raise to 86% of the GM’s salary. So, it used to take one salary to manage 63 employees. Now it takes 1.86 salaries to manage 42. Nearly $500,000 per year goes to pay these two employees!
Gravity Supply Line contractor sues AWA and is awarded $1,100,000.
AWA’s gravity Supply Line (GSL) had many problems during and after construction. AWA staff and directors publically blamed the contractor for the problems. Based on language in the settlement agreement, the contractor was not happy about the defamation and sued AWA over contentions relating to extra work, design, failure to properly administer the Project, delays, responsibility for delays, performance of claimed deficient/defective work, alleged failure to perform, as well as a series of unresolved additional contentions. Looks like the spouting off cost us some serious bucks. In fact, so much that AWA doesn’t have enough to pay the settlement without first getting a $300,000 loan from the county Supervisors. The GSL contractor contended that the AWA had materially breached the Contract. AWA agreed to drop all of the claims related to delay or liquidated damages as if they had never been asserted.
Over 1,000,000 wasted on piping Amador Canal
After years of pursuing a project that would take water from Amador County and give it to EBMUD customers, AWA quit after spending more than a $1,000,000. The planning was so poor that the $5 million grant that was supposed to be used to fund the project turned out to be about half of what was needed and would expire before AWA could use it. AWA underestimated the value of the property easements, the cost of construction, the cost of land valuation and litigation costs. Because AWA Directors changed their mind AFTER awarding the project construction, they had an additional $25,000 settlement expense to pay the contractor. As a result, the project became another big waste of money with no benefit to ratepayers.
AWA has wasted over $2,000,000.00 that is directly attributed to bad decisions and poor planning.
Have you heard one word about any of this? OF COURSE NOT! But now we will understand why, when the agency attempts to raise our rates one more time. Think about this…. Without the rate increase from 2015, they wouldn’t of had the money to waste in the first place. When they come knocking, let’s not give them any more to waste.
Amador Water Agency fined in May for violating California Political Reform Act
The Ratepayer Protection Alliance recently learned that in May 2016, the Amador Water Agency was fined $3,000 by the Fair Political Practices Commission for violating the California Political Reform Act. The fine was imposed because the AWA’s directors and board spent agency funds to mail more than 7,000 letters urging ratepayers to not to sign a referendum that would have overturned a temporary water rate surcharge. The production and mailing of the letter cost AWA approximately $9,487. The letter was also posted on the AWA website and submitted to a local newspaper.
As stated by the FPPC, “The Political Reform Act (the “Act”) prohibits local government agencies from sending mass mailings and campaign related mass mailings at public expense. AWA violated the Act by sending a mass mailing paid for with public funds.”
UPDATE: Howard Jarvis Taxpayers Association comes to the rescue of Amador Water Agency Ratepayers
On 3/8/2016, the Howard Jarvis Taxpayers Association (HJTA) filed a lawsuit against the Amador Water Agency (AWA) regarding its refusal to act on the qualified petition titled “Referendum Against A Resolution Passed by The Amador Water Agency Board of Directors” which was circulated in response to water rate increases. The Ratepayer Protection Alliance (RPA) organized Amador voters and successfully collected over 2,500 signatures for the referendum asking the AWA to repeal the rate increase or submit the issue to a vote. Amador County Office of the Registrar verified that the referendum received a sufficient number of signatures. However, AWA decided to ignore the protest, claiming that:
- The referendum protesting rates is beyond the power of the voters;
- The constitution does not reserve the referendum power as a means of repealing a rate increase;
- The petition is fatally confusing because it contains more than just the text of the subject Resolution.
In its papers submitted to the court, HJTA meticulously debunks each of AWA’s excuses for ignoring Amador voters. HJTA states that “The Agency is blatantly refusing to perform its ministerial duties as required by law and is in gross violation of a constitutional right…” The Elections Code requires AWA to either rescind the rate increase or allow Amador voters to decide at the next election.
The lawsuit seeks to place the referendum on the ballot for June 7, 2016. The Amador Superior Court has scheduled a hearing for April 1, 2016. If the Court rules in HJTA’s favor, the Court may at that time issue a writ of mandate ordering the Agency to certify the petition and call the election.
The filed ex parte petition for writ of mandate and the points and authorities documents are available at the links below.
UPDATE: AWA Disenfranchises Amador Voters over Water Rates
On 9/23/2015, Amador County Elections certified that more than enough voters signed the petition against a resolution that would raise water rates by 34% to as much as 137%. Amador Water Agency (AWA) did not certify petition for the ballot. In doing so, AWA disenfranchised over 2,300 voters who recently signed the petition. The voters merely asked to have the decision on the ballot so the people could decide on the rate increase. Ratepayer Protection Alliance (RPA) is consulting with those voters, and has not decided on which options to pursue.
AWA offered three legal arguments for not certifying the petition. RPA is not persuaded by the arguments:
- Without the rate increase, AWA allegedly cannot safely operate
- The Proposition 218 process replaces the referendum procedure
- The petition causes confusion because it is improperly worded
Each of the arguments is easily seen to be false, as described below:
- AWA cites the “Mission Springs Water District versus Verjil” case as prohibiting referendums to limit rates. In fact, Mission Springs is about an initiative, not a referendum. However, the underlying issue is that State law requires that the revenue must be sufficient to safely operate a water system. Mission Springs decided that an initiative cannot set rates so low that the system cannot operate. AWA’s rates are very different because AWA’s own records show that the rate increase challenged by the referendum is greater than the amount needed to operate the system. Furthermore, there was no emergency requiring the Directors to act at this time. AWA has repeatedly stated that unless rates are raised, it will exhaust its reserves within 2 years. Unlike an initiative, the referendum did not set rates, but merely sought to invalidate a hasty rate increase that is not justified by any actual shortfall in revenue.
- Proposition 218 gives certain rights concerning water rate increases to property owners. The referendum process gives voters the right to overrule the officials they elect to represent them when those officials behave irresponsibly. While many voters are property owners, many more are not. Furthermore, Prop 218 gives one vote to each parcel, while the referendum law gives one vote to each elector. The two procedures exist independently side by side.
- AWA cites a particular section of the Elections Code to say that the wording of the petition was confusing. Section 9147(b) says “Each section of the referendum petition shall contain the title and text of the ordinance or the portion of the ordinance which is the subject of the referendum.” That was done. AWA objects to the following sentence in the petition: “The title and text of the 'FY 15-16 Water Rate Update and Water Shortage Financial Strategy' and 'System-Wide Cost of Service and Water Rate Study' are below in their entirety.” However, the sentence is true because those documents were included with the title and text of the subject ordinance. There is no confusion.
RPA believes that AWA deliberately took this action to thwart the rights of the voters of Amador. Now AWA will use those same voter’s funds to defend AWA’s actions if the voters challenge it.
AWA sends petitions to Elections to be counted
At AWA’s 8/27/15 Board meeting, the directors voted to send the referendum petitions to County Elections for counting. According to the Elections Department, Elections plans to start the counting on September 8th and they are required to have the count complete by October 1st.
Once the count is complete and an adequate number of signatures has been verified, the directors will decide whether to rescind the rate increase or whether the referendum will go to vote. If they choose to send the matter to a vote, the directors will need to decide whether to waste ratepayer funds by scheduling an expensive special election or to save ratepayer funds and schedule the vote at the next regular election in June 2016.
Amador residents speak out against AWA rate increase
On 8/19/2015, the Ratepayer Protection Alliance (RPA) delivered over twice the signatures needed for a referendum, requiring the Amador Water Agency (AWA) to rethink their latest water rate increase. This referendum will suspend the 56%-137% rate increase approved on 7/21/15. The AWA board must now choose to rescind their increase or to allow Amador voters to decide whether the increase is fair.
RPA used no paid signature gatherers, instead organizing over 100 local volunteers from Ione to Buckhorn, some with their own teams of workers. With the coordination of local businesses like WalMart, SaveMart, Ione Market, Pokerville Market and Grocery Outlet, RPA was allowed to table petitions, rate information and even offered voter registration or change of address forms. Over 2,600 concerned citizens signed the petition, including business owners, students, professionals, retirees, and several local elected officials.
After the county Elections Department certifies the referendum by verifying the adequate number of signatures, AWA must follow the voters’ request to either eliminate the rate increase altogether or to send the increase to the ballot for Amador voters to decide.
Although not required, the AWA directors could decide to hold a special election at a greatly increased and unnecessary cost to ratepayers. Action could be taken at the 8/27 AWA meeting.
RPA is encouraged to see Amador residents actively protecting their rights. Amador voters still have the right to change or stop elected officials when they feel they are wrong or unfair.