Wallace Group no-bid contract on lame duck agenda

November 24, 2014
Mayor Tony Ferrara

Mayor Tony Ferrara


Arroyo Grande Mayor Tony Ferrara is slated to give a no-bid contract to two engineering firms for consulting services before he gives up power over the city’s agenda and council.

Tuesday’s Arroyo Grande City Council meeting marks the final council schedule and meeting Ferrara will control. The 10th item on a packed consent agenda is a proposed six-month extension of a two year contract for both the Wallace Group and Water Systems Consulting.

Though the agenda says there is no cost involved in extending the two agreements for on-call engineering services, in the past 12 months the city has paid the firms over $200,000. From Dec. 1 through Nov. 30, the city paid Wallace Group $110,564 and Water Systems Consulting $91,518, according to city records.

Ferrara came under fire this summer after allegations he attempted to coverup an alleged sex scandal between then city manager Steve Adams and a subordinate employee. Ferrara and Adams later claimed police officers lied about an incident involving Adams and the subordinate in an attempt to manipulate salary negotiations.

John Wallace

John Wallace

In addition to allegations of a coverup, questions about mismanagement and waste of public funds resulted in Ferrara being unseated after 16 years on the council.

In particular, the public questioned Ferarra’s leadership role on the South San Luis Obispo County Sanitation District Board. The sanitation district serves the residents of the Oceano Community Service District, Arroyo Grande and Grover Beach and is governed by a three person board consisting of one representative from each community.

In 2012, the state water board determined that a more than 384,000 sewage spill was due to careless and improper maintenance of the district by its administrator John Wallace and his engineering firm the Wallace Group. The state then levied a $1.1 million fine.

Ferrara stood by Wallace and the Wallace Group claiming a San Luis Obispo Grand Jury report that found a conflict of interest in Wallace’s administration of the plant was faulty and arguing against the state water board’s findings of mismanagement.

In Feb. 2013, amid demands for a complete audit of Wallace’s financial management, Wallace resigned as administrator of the sanitation district.

Before he stepped down, the sanitation district regularly exceeded its more than $6 million annual budget. Under a new administrator, the district’s costs are less than 50 percent of its budget, district records show.

Tuesdays Arroyo Grande City Council meeting is scheduled to begin at 6 p.m. at the council chambers at 215 E. Branch Street.

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I will be in control. I will be in control

Tony Ferrara resigned his position tonight effective 5 pm on Friday.

I guess he does not want to pass the gavel in a ceremony on Monday night.

Congratulations Mr. Guthrie.

You are Mayor for the weekend!


For such a big guy, Tony sure looked small tonight.

No best wishes to Jim Hill who was voted in by the majority of voters.

Congratulations to Barbara Harmon, Tony sure let you know how smart he was to appoint you to the ARC, while Kristen got the council appointment.

Kristen meanwhile is still trying to understand the true meaning of “clearly audible”.

Guthrie is Mayor for 3 days

You CAN NOT make this stuff up.

Dec 1 can not come soon enough!


This isn’t rocket science. NO ONE in their right mind would consider giving ANY type of contract to an individual or company that was directly responsible for the mismanagement including, but not limited to deferred maintenance, malfeasance, false reporting, breach of contract resulting in fines exceeding a million dollars.

Lets not reward failure! Enough is enough.


No longer does Arroyo Grande have to suffer at the hands of a demagogue. I see no reason what ANY no bid contract awarded to a company like the Wallace Group, with their reputation couldn’t be immediately rescinded by the new mayor. Let them try and sue…


Big Tony claims the police union used unsavory tactics for a huge raise, but in turn he is giving his buddy Wallace a nice little pay day before he leaves. Big Tony thinks the AG residents are stupid and can’t see through his little scam. And I’m sure big Tony will give some high and mighty speech on how he was ousted by a small group of trouble makers and an evil blood thirsty police union. I wonder if he is just mad because he can’t give his friends sweet heart deals. As tax payers we need to stand up against back door deals, this is no longer King Tony’s Kingdom it is The People’s Kingdom!




I am not sure that the mayor has the power to rescind contracts on his own. Given the makeup of the new council, it may be difficult to get them to agree too. It is time for some gentle pressure on Barniech, Brown and Guthrie to push them onto a responsible path.


QUOTING OTOH: ” It is time for some gentle pressure on Barniech, Brown and Guthrie to push them onto a responsible path.”


You are not serious, are you?

We already sent them a ninja wake-up call by voting Ferrara out of office.

What in the world makes you think the city council members will change their Ferrara-toadying ways if just “gentle pressure” is applied?

Brown and Guthrie voted for the Wallace contract extension, after asking basically nothing but soft questions to lead up to what they had already, surely, planned to do.

We have to recall at least Guthrie and Brown. Anything short of that will be the same thing as doing NOTHING.

Jorge Estrada

Greetings Charlie! What’s up now Bozo? Does this guy, Tony, look like your insurance man? No Bozo, he looks like the reason I buy insurance.


To me appears that Mr Ferrara wants to continue to do battle with citizens he feels are stupid, un-infomed, and un-involved. He has clearly not learned anything from the recent election and I fully feel that the remaining council members have not learned anything either.We need to continue to be a force at the council meetings in order to not only voice our opinions and state facts that may be overlooked during council discussions, but we also need to show the remaining council members that this is far from over and they are not going to continue to make decisions that are not in the best interests of the residents of AG.

We did win the mayoral battle, but the war is far from over…


The city council will grow used to continued resident anger after awhile. Then what?

We need to get Guthrie and Brown OUT OF OFFICE.


Jesus, just made the mandatory read of CCN’s comment guidelines. No “Shakespearean soliloquys”. How can I be accused of it if I don’t know what it is? Anyway, on to the article. You need to be aware that smaller cities and other government agencies contract with private engineering services that say, the City and County of San Luis Obispo do not. The Wallace Group has competitors, believe you me. That the contracts are “no bid” is due to there being no scope of work, just hourly charges for services that the City of SLO has a fleet of 6 figure employees to perform. Can’t bid what you don’t know you’re going to be doing. I would check with Wallace Group’s competitors to see if they were interested in the work.


Hi Obispan—could you indulge me and explain what you mean by the “there being no scope of work, just hourly charges for services?” I am speaking at the council meeting tomorrow and want to make sure I have my ducks in a row—any additional explanation you can provide would be super helpful—thank you in advance….:)


Absolutely. If you’re a city like Arroyo Grande, a whopping 17,000 people, you cannot afford to hire full-time people for part-time jobs with specific qualifications and expertise to meet a myriad of state requirements. Do you want to hire a storm-water management specialist, and 2 more to cover sick or vacation leave on the part of the first two (could easily happen) or do want to pay as you go for a company with more employees in one specific area, engineering, than your whole city employs to patch potholes, mow the parks, respond to emergency calls, teach yoga classes, jet the sewers, etc.? If you have a hard-on for the Wallace Group, fine. Fire them. Hire Cannon (both fine firms BTW), or whoever. You could even subcontract from a larger agency like SLO County. The key thing is that these guys and girls are X hours at $78 when you need them, otherwise they are busy working for their company elsewhere and otherwise.


Here are some corrections to your information. Small local cities like Pismo, with a whopping 7500 people, do in fact have their own Compliance coordinators. They perform the same functions Wallace has schmoozed from his whore pals for pennies on the Wallace dollar. The Sanitation District for example for decades prepared their own monthly and annual W/Q reports. This is typically a function of the Chief Plant Operator and/or the Lab tech. The San Dist did in fact do these reports in house until 08 or so until it was assigned it to Wallace’s Heather Billings for no explainable.Billings a Chemical engineer by trade with NO former experience in compliance matters took over at twice the cost of in house work. As a matter of fact the former lab tech held the highest grade obtainable in her profession, as well as performing as a industrial waste inspector and compliance officer in the Bay area before joining the Sanitation District. As far as the use of the phrase “at no extra cost” another misleading statement. Wallace charges in 15 minute increments. Tasks as simple as a phone call and a quick question are billed accordingly. I assure you use of the word Free and The Wallace group is a Oxymoron.


A lot of options to reduce costs, and waste in our cities,community services districts,five cities fire,and South County Sanitation district. We need some really strong disciplined fiscal leadership.


And, in AG, a mayor, city council members and a city legal counsel to ensure whores like Wallace never get a contract in our city again.

We already have the new mayor, Jim Hill. All we have to do is get rid of at least Guthrie and Brown, as well as Carmel.


Pismo Beach, literally, has more money than it knows what to do with. Yes, they can afford the extra staff.


Everybody charges in 15 minute increments. And who said “at no extra cost”, or “free”? You were responding to my comment but seem to be bringing a lot of unrelated personal baggage. Inside baseball, as it were. I have no specific knowledge of this particular contract arrangement. I do know, however, how government agencies with tight budgets and complying with burdensome overlying regulations make do during tight times.


QUOTING OBISPAN: “If you have a hard-on for the Wallace Group, fine. Fire them. Hire Cannon (both fine firms BTW), or whoever.”

If you believe Wallace Group is a “fine firm,” then you are clueless about current and past events in SLO County, especially Wallace’s corrupt behavior and the conflicts of interests involved with even having him as the Sanitation District’s supervisor or administrator…or you are without ethics yourself.

Search CNN for “Wallace” and “South County Sanitation” to inform yourself.

Everything Wallace breathes on is corrupted, and when you have a city council and city counsel like we have in AG, that means Wallace will rob the residents of Arroyo Grande blind.

AND I predict the city council and city counsel will coverup for Wallace, no matter what he does, just like Guthrie and Brown did they set up the Sintra coverup of the coverup.

When Guthrie and Brown so narrowly defined the second “investigation,” by Sintra, to be limited to deal only with items Sintra could manipulate to shield ex-mayor Ferrara, the city council and the cousel from the fall-out if a more legitimate investigation was performed– AND THEN when Guthrie and Brown ACCEPTED AS VALID both the original Carmel sham investigation and the Sintra investigation which served no reason but to further the cover-up of the cover-up, it was clear they are as corrupt as Ferrara.

That the AG city council would even CONSIDER extending Wallace’s FOG contract is even more evidence that the AG City Council is so bereft of ethics and common sense that they are unfit for serving the residents of Arroyo Grande on the city council.

Guthrie and Brown, at the very least, MUST GO. With those two Ferrara step-and-fetch-its on the city council, it will be difficult for our new mayor, Jim Hill, to make the changes he knows have to be made.

For a list of the conflicts of interest involved in contracting with the Sintra Group that I, myself, could find after about 10 minutes searching the internet, visit:




If there are exaggerations in MaryMalone’s comments above, they are not significant. Wallace Group may have the technical qualifications of a good engineering firm and perhaps they have done good work in the past too. But their history over 10 years at SSLOCSD if rife with overcharging and incompetence. The latter may well be due to mismanagement rather than inability but that is not reason to call them anything but unqualified for public sector funds.

If the criteria for selection of contractors does not currently take ethics and integrity into account as well as expertise and technical qualifications, it needs to be changed.


Well….just make sure your ducks aren’t lame. ;-)


Nothing is as lame as the out-going mayor and the coucil which protected him and Mr. Adams. But I will do my best :)


Quack… Quack…


very insightful comments


That Wallace Group has competitors?


You betcha, lots of them. What’s your point? (other than your head). You want a list?


No thanks, I have my list already, get it every year.

My question was to DaddyO.

What’s YOUR point?


For a FOG program, there certainly is a scope of work…well, at least in most government agencies. In reality, for all we know, Ferrara and Carmel just gave the Wallace Group a blank check and said “have at it.”

However, contracts DO specify what the government agency expects to be done.

The problem with programs like FOG is often those doing the contracting out don’t know what the program should be doing, or how to measure the results. They depend on the contractor to design the program, perform the program, and then report on the results. There is often no verification by the contractor (i.e., City of AG in this case) whether the work they are charged for is actually being done.

This isn’t just with FOG programs, it is with many programs, such as water conservation programs.

Remember, we are dealing with the Wallace Group and Ferrara here, and with a city council which is WAAAY to easily manipulated by Ferrara and Carmel.

In a legitimate contract, even in an extension of a contract, they still must perform on the “scope of work” and report their findings.

It is JUST DAYS before our new mayor, Jim Guthrie, is sworn into office. We simply cannot allow our city to be saddled with another cronyfied Ferrara-serving contract.


Oops Mary, new Mayor is Jim Hill, not Guthrie.

ITA with your points. Anything Wallace = rubber stamp for far too long.

I am certain Jim Hill will review all the City’s contracts, but he’s still only one vote.

Harmon seems like she’s a go-getter and will educate herself as well.

Keeping fingers crossed that another vote will come around, would be great to have one or more of the holdovers step out from the Ferrara fold.

Wouldn’t it be great if one or more were looking forward to change as much as we are?




Thanks again to CCN for helping us keep tabs on Tony.

Please tell us you’ll continue to do so even after he leaves office on Dec 1.

We’ve only scratched the surface, there’s still so much to learn.


I saw this and immediately thought of The Wallace Group!



One of the government agencies I worked for, every day was like working at Dilbert’s office.

Clueless managers and GMs, who know nothing about an issue, omnipotently making decisions on contracting out programs (often that could have easily been done inhouse), and then cluelessly nodding their heads in acquiescence when the contractor presents the planned program, performance updates, and outcomes….it is so prevalent.


Sheeple, why do the homework when you can just look at someone else’s paper?


City Hall and sewer plants

Write-in votes and Jim Hill’s thanks

And deceit and cover-up everywhere,

I’ve looked at Arroyo that way.

But now they only block the sun,

They rain and snow on everyone

So many things we would have done,

But Tony got in our way.

We’ve looked at the Mayor from both sides now

From up and down and still somehow

It’s his illusions we recall

He didn’t care about Arroyo all

But now it’s just another show,

We’ll leave ’em lwhining when they go

They never cared care, that we know,

They gave our city away away.

We’ve looked at Tony from both sides now

From give and take and still somehow

It’s many illusions we recall

We really don’t know him at all

Tears and fears and feeling proud,

To say Jim we love you right out loud

Dreams and hope and Arroyo crowds,

We’ve looked at life that way.

We’ve looked at life from both sides now

From win and lose and still somehow

It’s life’s illusions we recall

We really don’t Tony at all

We’ve looked at life from both sides now

From up and down, and still somehow

It’s life’s illusions we recall

We really don’t know Tony at all