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John Wallace’s attorney threatens sanitation district

February 4, 2016

Wallace signs

By KAREN VELIE

An attorney for former South County Sanitation District administrator John Wallace asked the district board Wednesday to rescind their decision to send allegations of criminal malfeasance to multiple law enforcement agencies and then alleged the district faced legal liability if it did not cooperate.

Two weeks ago, the board voted to send the 124 page Knudson Investigations report of mismanagement and malfeasance to the FBI, the San Luis Obispo District Attorney and the Attorney General. Carl Knudson has worked for more than 40 years as a fraud investigator and has testified as a certified fraud expert in more than 50 federal and state trials and proceedings.

However, sanitation district staff said Wednesday they had been busy with other tasks and had not yet taken the report to law enforcement.

John WallaceOn Wednesday evening, the sanitation district board provided Wallace time to respond to the allegations in the Knudson report.

Wallace asked the board to reject the report and not to send it on to law enforcement. In support of his request, Wallace said the allegations in the report were untrue, it was based on hearsay not facts, and that the bookkeeping under his leadership was meticulous.

Approximately 75 people attended the board meeting forcing some to listen to the meeting from an adjacent room. In addition, three Arroyo Grande Police officers stood at the entrance to City Hall.

Following Wallace’s speech, the board allowed the public to respond. Of the 24 speakers, 10 asked the board to send the report to law enforcement and 14 spoke on Wallace’s behalf.

Wallace supporters were made up primarily of Wallace Group employees and service club members.

Several local Rotarians spoke of Wallace’s impeccable character before asking the board not to send the report to law enforcement.

“I have known John Wallace for a decade,” attorney Bill Herreras said. “My experience with John is honesty, integrity and good moral character.”

Wallace Group employees also touted Wallace’s community service work. Wallace Group principle Kit Carter said the rate payers who pushed for the investigation did not have the intellect to understand what was going on.

Several rate payers who supported the investigation said that the San Luis Obispo Grand Jury had come to the same conclusion as Carl Knudson and that it was important to let law enforcement either verify the allegations or exonerate Wallace.

“This is not about character,” Coleen Martin said to the board. “This is about your fiduciary duty to the rate payers.”

Attorney Dennis Law with the San Luis Obispo law firm of Andre, Morris & Buttery, said Knudson’s investigation was inadequate, did not include sufficient interviews with Wallace Group employees and should not be sent on to law enforcement. Law said he represents Wallace and the Wallace Group.

“You made a reference to law enforcement that has appeared in the newspaper,” Law said. “There is harm happening today, now, immediately to him and his business. So, what I feel needs to happen, you need to rescind the decision regarding the references to law enforcement. If their was a technical approval of the report, as a part of you action, you need to rescind it.”

After public comment, the board asked Wallace to provide it a copy of his response and took no other action.

When asked about Laws allegations of liability to the district, San Luis Obispo based attorney Stew Jenkins expressed surprise. Jenkins said that California Civil Code Section 47(b) provides an absolute privilege for matters brought up in proceedings such as sanitation district meetings.

In addition, the California Supreme Court had held in the 2004 Hagberg case that it is absolutely privileged to refer a government audit to law enforcement specifically to assure the open communication between citizens and public authorities responsible to investigate and remedy wrongdoing, Jenkins said.


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The attorney’s threat is how we know Wallace is guilty.


If I know I am not guilty, I wouldn’t thteaten you.


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Who was that rude guy who came up during public comment for items not on the agenda and berated the crowd and the board? Was that Wallace’s PR guy or his lawyer? If either, he should be fired! He was out of control.


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Here’s a little something else Wallace should have clarified for the ratepayers on Wed. when he claimed his records for the sanitation district were impeccably maintained:


From an earlier article:

In Aug. 2013, Wallace, on behalf of the sanitation district, appealed FEMA’s denial to fund an additional $39,675 for cost overruns. In his appeal, Wallace provided the cost of each invoice and a brief description of the work done, according to the denial letter.

FEMA responded back in Jan. 2014 requesting more detailed information about each invoice and the work performed.


Wallace Group then “acknowledged it had mistakenly included an additional $14,773 in funding” in its appeal request, according to FEMA’s appeal analysis. Wallace Group then revised the appeal amount from $39,675 to $24,902.


Wallace Group submitted nine cost overrun invoices to FEMA for a total of $15,761.


OOPS!


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Just called the Attorney General. It takes about a week for them to track they received the complaint. They do LOOK at every COMPLAINT.


If you want to complete a comment to them urging them to look deep into the SSLOSD, just complete the online form at:

https://oag.ca.gov/contact/general-comment-question-or-complaint-form


COPIED FROM ONLINE PAGE

General Comment, Question or Complaint Form


If you prefer to contact us by regular mail or have copies of documents to submit in support of your comments,

download this form, then print, fill in, and mail.

For information on the collection and use of personal information, please see our notice, Information Collection, Use and Access.


First Name *

Last Name *

Address Line *

City *

State *

Zip Code *

Email Address

Your Comments

Please include the following information in the text of your comment/complaint if relevant:


Message *

Affirmation

I affirm that the foregoing information is true and accurate *

Yes

No


WE SHOULD ALL COMPLETE THIS SO THEY KNOW WE MEAN BUSINESS!!


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That was easy–thanks for the link. Following is my comment.


I am a ratepayer of the San South Luis Obispo Community Services District, aka SSLOCSD.

Recently Knudson and Associates completed an in depth investigation into the Wallace Group, and John Wallace’s dealings with our District.

I understand you will be receiving Mr. Knudson’s report shortly.

District ratepayers have waited more than a decade for answers as to why mismanagement of our sanitation plant was allowed to continue under Mr. Wallace’s tenure as both District Administrator AND District Engineer.

I would urge you to give this matter the consideration it deserves.

Thank you.


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FROM a PREVIOUS ARTICLE ABOUT JOHN WALLACE her on

CCN in January 2011


undertowsays:


01/30/2011 at 12:03 pm


Do your part and call 781-5800 for the SLO DA’s office. Then call the Ca Attorney General’s office toll free @ 1800 952-5225 and demand action be taken NOW!!!!!! That’s all it takes, a few minutes of your time.

Please do it.


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Called the SLODA

They could not confirm they received the report.

Emailed the San District this AM, and they said it was off

In a week, should be able to get confirmation from SLODA.


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What do you ant to bet that Dan Dow is another rotary buddy of JW, and will testify for his “character”!


Skip the local, go for State Attorney and FBI!


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Someone should list the names of the “Rotarians” who spoke on behalf of Wallace. Then maybe their business dealings with him could be exposed. This is a dirty, dirty situation.


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The ones I picked up on from the meeting are:


Talley Vineyard and Winery


Pacific Coast Kitchen and Bath


Jeff Buckingham


Verdin Marketing


When I get a chance will watch the video to determine others


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Brian Metcalf – My hope is when all this is over the people who are making these accusations against him are willing to have their pictures on the front page of the paper apologizing and saying that they’re wrong.


Bill Hererra,


John Sieman


George Aguilar


Terra Malzone


Dennis Delzeit


Kit Carter – Worked with Wallace on many projects. It’s easy for those (SSLOCSD ratepayers) with less intellect to criticize others.


Brad Breckwell, Principle of the Wallace Group – accusations in this report made without facts.


Clayton Bradshaw –


Tim Williams – the ratepayers are sitting on the sidelines and taking potshots.


Dennis Law – there should be a fair investigation of these issues.


Bianca Coney – checking to be sure his people are always busy.


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Wasn’t Steve Adams in Rotary as well?

Ferrara’s allegiance with Wallace was steadfast, and is well documented. But as city manager, Adams also had a lengthy relationship with him. Who knows if MBI projects were ever put out to bid, or if Arroyo Grande gave Wallace the same preferential treatment he received at the Sanitation District?

This goes much further than Ferrara and Nicolls.

Ferrara didn’t act alone in AG–he had lots of help from Adams.


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You nailed that.

Adam’s was Ferrara’s enforcer.

Ferrara gave the orders and Adams did the behind the scenes dirty work.

With a smile on his face.


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You are so right! I bet are many local businesses in AG who did not get projects through because they did not play the Wallace game.


And Wallace was given first in line treatment over the other engineers contracted to work with the city. Makes you wonder what Wallace “gave back’ to Adams/Ferrara for his priority status.


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There’s something happening here

What it is ain’t exactly clear

There’s a man with a lawyer over there

Telling us we got to beware


I think it’s time we stop, children, what’s that sound

Everybody look what’s going down


There’s battle lines being drawn

Nobody’s right if everybody’s wrong

District customers speaking their minds

Getting so much resistance from behind


It’s time we stop, hey, what’s that sound

Everybody look what’s going down


What a field-day for the heat

A thousand people in the street

Singing songs and carrying signs

Mostly say, hooray for our side


It’s s time we stop, hey, what’s that sound

Everybody look what’s going down


Wallace paranoia strikes deep

Into your life it will creep

It starts when you’re always afraid

You step out of line, the man come and take you away


We better stop, hey, what’s that sound

Everybody look what’s going down

Stop, hey, what’s that sound

Everybody look what’s going down

Stop, now, what’s that sound

Everybody look what’s going down

Stop, children, what’s that sound

Everybody look what’s going down


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Chris Gardener deserves a big raise and his own LLC if he can stop this PR nightmare.


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He already got his raise, unfortunately is was from the pockets of the SSLOCSD ratepayers, thanks to John Wallace


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CHECK OUT THE LOCAL VIEWPOINT in the TRIBUNE Pg. 1B

where the first sentence Wallace lays the foundation of “popsicle sticks and Elmer’s Glue” for his defamation lawsuit. Wait for it, wait for it… I smell it coming.


“For several years, my Wallace Group colleagues and I have been under intense criticism for our work with the South County Sanitation District. We remained silent”


Excuse me: NO ONE is blaming anyone else at Wallace Group but the principal: John Wallace.


Since the Grand Jury Report in 2011, Mr. Wallace should have been paying attention.


The advocates of the San District did not assassinate his character; Ironically it is his employees and Rotary brothers who seemed to be the one to drag the “character issue” into the discussion.


He closes with: ” Rather than being burdened by the Wallace Group, the community greatly benefited from our services. Of that, we have no doubt. Of that, we are immensely proud.”


I’m getting sick again!


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Oh how they can spin it.


Wallace states: ” Knudsen intentionally declined to interview other Wallace employees even though they were offered”


Kinda left out the part ” if I could sit next to them in the interview”


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details, details, details………


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How significant was the election of Jim Hill?

Replacing Ferrara didn’t change the majority of the SSLOCSD board, but did bring some new recruits who added their voices to those who have fought long and hard for transparency.

Jim Hill’s prior experience with Shoals, Nicolls, Seitz, and Ferrara, and their history of dirty deals has tipped the scales.

The public push for the investigation could no longer be ignored, although Shoals, Guerrero, Seitz and Lucey gave it their best shot.


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I’m sure they have an FBI office in Palm Springs to host the interview with our former Mayor Ferrara.


Perhaps the spider’s web will take him to Tony’s LLC: Arroyo Consulting and tie its revenues about the time ( 2002) when things really started spilling out of the San District.


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Ferrara’s LinkedIn page has the City of Arroyo Grande’s logo on it.

Either he’s forgotten he’s no longer the mayor, or he’s got some b@lls giving the impression he’s still associated with the city.


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He’s got some b@lls.


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