Costly disputes plunge sanitation district into the red

March 23, 2017

By JOSH FRIEDMAN

Claims of juvenile behaviors are mounting at the South San Luis Obispo County Sanitation District, with at least five investigations launched over the past year. The ongoing squabbles have become increasingly costly to rate payers.

Over the last 14 months, the sanitation district has launched investigations into alleged acts of racism and code of conduct violations by the district administrator, alleged threats made by the sewage plant chief operator and an alleged Brown Act violation by a board member.

In addition, earlier this month, plant administrator Gerhardt Hubner placed plant superintendent John Clemons and district secretary/bookkeeper Amy Simpson on paid administrative leave. Hubner has not publicly disclosed why he placed Clemons and Simpson on leave.

Nevertheless, in early February, Clemons filed a grievance against Hubner alleging the administrator’s behavior violated the sanitation district’s code of conduct rules. An investigation into the allegation is ongoing.

Clemons is a grade four wastewater plant operator. He took over as chief plant operator in May 2013. Less than a year later, the plant was operating cleaner at less than 50 percent the cost, according to district financial reports.

Clemons is currently being replaced by Shannon Sweeney, a grade five wastewater plant operator who has worked for the district in the past. But unfortunately, Sweeney is now permanently confined to a wheelchair, making it impossible for her to meet the supervisor job requirements, according to the sanitation district’s policies and procedures manual.

The sanitation district provides sewer services to about 38,000 customers in Arroyo Grande, Grover Beach and the unincorporated town of Oceano. Its three member board includes a representative from each of its member agencies.

During the current fiscal year, the district has spent about $50,000 on investigations into staff and board members. The majority of the investigations have been launched without board approval.

Arroyo Grande mayor and sanitation district board member Jim Hill said that of the five investigations launched in the past year, only two had come before the board.

With several investigations ongoing, the sanitation district has increased spending to cover additional legal counsels, a contract human resources company, a contract human resources law firm and a mediator. There are just nine full-time employees at the district.

Last April, the district board hired Gerhardt Hubner to be the agency’s full-time administrator at a salary of $12,500 a month, more than three times what the former district administrator was paid.

In the first quarter of the 2016-2017 fiscal year, the cost of running the district skyrocketed from approximately $625,000 a quarter to $1.3 million a quarter. District expenditures exceeded district revenues by $300,000.

The district has continued to operate in the red over the first seven months of the current fiscal year. As of Jan. 31, total expenses for the fiscal year were $2,730,447, and total revenue was $2,343,930, according to a district staff report.

Last year, two employees filed grievances against the district and another one made a verbal complaint of discrimination. In each case, the district board went into lengthy closed sessions and then backed Hubner.

In January, the wife of former board member Mary Lucey yelled at Clemons outside a board meeting, saying she would not pay to wash his dirty underwear. The comment referenced Clemons’ decision to purchase a $666 washing machine for plant workers’ undergarments that get splashed with sewage.

An argument ensued, and following the meeting, Lucey and her wife contacted the SLO County Sheriff’s Office and filed a report claiming Clemons had threatened Lucey’s spouse. Though the sheriff’s office examined the allegation and opted to take no action, Shoals, on behalf of the sanitation district, contracted with an outside agency to conduct an investigation.

On March 1, the sanitation district board voted 2-0 to join an investigation launched by the city of Arroyo Grande into an alleged Brown Act violation by Hill. Earlier this year, an Arroyo Grande resident claimed Hill violated the Brown Act by distributing an employment contract that had yet to be approved by the sanitation district board.

Simpson, who remains on administrative leave from her district secretary position, has since defended Hill, saying he did not violate the Brown Act.

“I take complete responsibility for not resending the board the new version of the board pack with the redacted contract,” Simpson wrote in a letter to the city of Arroyo Grande. “The reason for this statement is to clear Mayor Jim Hill of any Brown Act violation regarding the sharing of Mr. Hubner’s un-redacted contract. This contract was part of an agenda and not a closed session item. I believe this is a personnel matter and not a Brown Act violation.”

Nevertheless, the joint Arroyo Grande-sanitation district probe into Hill is ongoing.

The flurry of investigations has come in the aftermath of the sanitation board forwarding a case against former district administrator John Wallace to the San Luis Obispo County District Attorney’s Office. After a 10 month investigation, prosecutors filed criminal conflict of interest charges against Wallace, who allegedly funneled money from the sanitation district to his private engineering company.