Sanitation district showdown set for Wednesday
March 16, 2011
A proposed investigation into accusations that the administrator of the South San Luis Obispo County Sanitation District (SSLOCSD) has been using his position to funnel monies to his private engineering company is on the district’s Wednesday board meeting agenda.
Allegations of misdeeds that include the misuse of public funds, firing whistleblowers, manipulating sewage spill amounts and tossing unclean water tests have plagued the SSLOCSD for more than a year.
John Wallace is the chief administrator of the district that provides services to about 38,000 customers in Arroyo Grande, Grover Beach and Oceano. He is also owner and president of the Wallace Group, a private engineering consulting firm located in San Luis Obispo that receives about $80,000 a month for plant administration and engineering services.
Wallace and SSLOCSD board member Tony Ferrara have repeatedly claimed the allegations made against the district and Wallace by several plant employees are unfounded.
During a Surf Rider board meeting a little over a week ago, Wallace said that employee claims that they had been fired for informing regulators of problems at the plant would soon be proven false and that the state labor board had already rejected their claims.
However, Krisann Chasairk, spokesperson for the California Division of Labor Standards Enforcement, said that the claims were not rejected. Former plant supervisor Scott Mascolo’s claim was withdrawn by his attorney who filed a lawsuit against the district.
Former laboratory technician Devina Douglas’ case is still open, though she was given a right to sue letter from the state. Douglas has filed two lawsuits, one against the district for wrongful termination and another against Wallace, the Wallace Group and plant manager Jeff Appleton for risking public safety and fraud.
Officials from the California Water Resource Control Board have investigated and validated many of Douglas and Mascolo’s allegations.
Arroyo Grande Mayor Ferrara spoke out at a city council meeting contending that media reports about problems at the plant were incorrect and had already been proven false by an independent investigation he initiated.
Following calls from plant employees that the plant was in violation of safety and health requirements, regulators took a closer look at the plant which resulted in the discovery of numerous violations.
In July 2010, a notice of violation was given to the plant for not keeping records of discharge samplings as required, not reporting that they had demoted one of the whistleblowers and for the improper testing of water samples in an attempt to make the plant appear to be in compliance with environmental requirements.
In January, regulators determined Appleton operated the plant “using fraud and deception,” according to a letter of proposed disciplinary action.
Appleton appealed the state water board’s findings blaming many of the violations on Wallace.
In response to allegations that the plant was operating without the proper manuals, Appleton said he had informed Wallace several times that the manuals needed to be rewritten, but Wallace said “there was not enough money available to update the manuals.” The state rejected Appleton’s appeal saying that as the district manager he was responsible for providing “simple and easy-to-follow plant procedures.”
Appleton also claimed he had not demoted two plant operators without informing regulators. Appleton said Wallace took away his ability to discipline staff even though it was under his job description, according to the state’s response.
In addition, Appelton claimed that one operator volunteered for his demotion and that Mascolo had been reinstated to his supervisor position following a Skelly hearing.
State regulators contend that there is no proof that Mascolo was reinstated. Mascolo also refutes Appleton’s claim and contends he was on paid administrative leave for a year.
As for the allegation that Appleton had asked the lab technician to dump a sample with high levels of bacteria that would show the plant was out of compliance, Appleton said that one of the plant’s operators, Trini Rodriguez, would verify that he did not ask Douglas to dump the sample.
The state rebutted Appleton’s response after interviewing three employees that confirmed the incident. As for Rodriguez, he refused to discuss the incident with the investigators, according to the state’s response which verifies the sample Douglas was asked to dump was in violation of state environmental requirements.
“The reported coliform analysis violated the discharge permit which was reported to the regional water Board,” the report says.
Nevertheless, the attorney for the district, Michael Sietz, was quoted in a Santa Maria Times article on Tuesday claiming that the sample Douglas was asked to dump was not in violation.
During the past three SSLOCSD Board meetings, board member Jim Hill has attempted get the Board to agree to an independent investigation into whether or not it is in the best interest of the district to have Wallace serve as administrator while his engineering firm is contracting with the district.
Each time Hill’s request was shot down by the other two board members. Then, on March 2 , with five members of the media in attendance, both Ferrara and Bill Nicolls agreed to place the issue on Wednesday’s agenda.
Wallace Group staff was asked to put together a report regarding a potential investigation into Wallace’s management of the district, according to the board packet.
Wallace Group staff concluded that every allegation made by Douglas and Mascolo has already been investigated by Rich Thomas of Thomas Consulting, including allegations that Wallace was funneling monies to the Wallace Group while acting as administrator for the plant.
However, even though Mascolo made numerous allegations of misspending, Thomas’ report only looks into allegations the district had paid too much for a roof paint job and a chemical tank. Mascolo’s allegations are redacted from Thomas’ report and Mascolo contends Thomas fails to address many of his concerns.
The SSLOCSD Board meeting is scheduled for 6 p.m. on Wednesday at 1655 Front Street in Oceano.