Water Authority’s Confidential Consultant Contracts Surprised Board

Government

Water Authority’s Confidential Consultant Contracts Surprised Board

The San Diego County Water Authority is building a team of consultants but won’t explain the work they’re doing, even to its own board of directors.

Illustration by Adriana Heldiz

The San Diego County Water Authority is building a team of consultants but won’t explain the work they’re doing, even to its own board of directors.

The Water Authority spent $167,000 on two consultant contracts since July 2019 without disclosing them to the board, which is composed of representatives from the region’s 24 water agencies. It also won’t say what a third contract that was approved by the board, worth more than $330,000, was for.

Board members’ dissatisfaction with the secrecy of the contracts – some which were entered into under a rule that allows the general manager to execute contracts below $150,000 without board approval – boiled over in a board meeting. One board member argued that a consultant was lobbying against her water district’s interests, and another couldn’t believe the board wasn’t alerted to the work the consultants were doing.

Mark Hattam, the Water Authority’s attorney, said in response to a Voice of San Diego records request that the contracts were exempt from public disclosure because they were an attorney-client work product. Hattam said the work the consultants were hired to do might be related to something somebody sues the Water Authority over in the future. Typically, public agencies’ financial contracts – which detail the spending of public money – are considered public records.

“The terms of those contracts are exempt because they reflect legal strategy, planning and action, and thus they would not be turned over in a PRA response,” Hattam wrote in a July 2 email. “However, the existence of those contracts and what has been expended on them can be public information.”

Kim Thorner, general manager of Olivenhain Municipal Water District and that district’s Water Authority board representative, said these types of contracts are not confidential at her agency.

“Anything I do every day I could be sued for,” Thorner said of Hattam’s explanation for keeping the contracts secret. “At the end of the day, why then wouldn’t that apply to every single water supply project?”

Hattam eventually shared that the Water Authority hired David Alvarez from Causa Consulting between Nov. 1, 2020, and June 30, 2021, for $67,500; IVC Media from May 27, 2020, to July 31, 2021, for $100,000; and Brownstein Law Firm from July 1, 2019, to June 30, 2021, for $331,620.35. (Hattam specified the confidential contract with the Brownstein law firm was for federal lobbying work, though the Water Authority’s longstanding relationship with this particular firm is well-documented.)

The Water Authority’s board of directors typically votes on contracts the agency issues or anything that involves spending public ratepayer funds. But the Water Authority’s general manager, Sandy Kerl, can execute contracts worth $150,000 or less without a full board vote.  Kerl did not respond to a request for an interview.

“I was taken aback that there were contracts approved under the general manager’s authority and that we were not being given a heads up they were entering into them,” San Diego City Councilman Chris Cate, and one of the 10 San Diego representatives on the board, told Voice of San Diego.

Thorner alleged one of those consultants lobbied against her water agency’s interests in fighting a multibillion-dollar pipeline construction project to the Colorado River, called the Regional Conveyance System.

“I don’t understand why regional conveyance is a confidential topic,” Thorner said. “In my mind, outreach on a water-supply project is public work and should be public.”

This dispute began earlier this year over a procedural issue called a proxy vote.

Water Authority board members can designate other members agency to vote in their stead – as a proxy – if they’re absent. Thorner had arranged with the city of Oceanside’s water director to replace a pro-pipeline proxy vote with Thorner’s anti-pipeline vote. But Oceanside’s City Council needed to first approve the switch.

Thorner alleged in a March 15 letter that a Water Authority-hired consultant stepped in and lobbied Oceanside Council members against the arrangement. In an April 8 response to Thorner, Hattam neither confirmed nor denied the claims.

Hattam finally told the full board at its April 22 meeting the Water Authority indeed sent Alvarez – one of the consultants whose contract wasn’t cleared with the board – to speak with Oceanside’s mayor, but only to clear up rumors that the Council’s decision on the proxy vote somehow threatened city funding for local water projects provided by the Metropolitan Water District of Southern California.

It’s unclear how the threatened funding rumor started, but Water Authority Director Jerry Butkiewicz piped up at the April 22 meeting saying he was alerted to Oceanside’s fears that the Regional Conveyance System project jeopardized Metropolitan funding. So he asked the Water Authority to send someone to clear the air.

“If you want to be mad at someone, be mad at me. Stop picking on our staff,” Butkiewicz said during the board meeting.

Thorner wasn’t satisfied. What’s important, Thorner said, “is whether Olivenhain ratepayer funds were used for a consultant to lobby against our own agency.”

Hattam maintained he found no evidence of an ethics violation by anyone and couldn’t find “any rule” that would prohibit Water Authority staff, consultants or board members from discussing Water Authority votes with member agencies.

“At the very least, it’s improper,” Thorner said in response.

Alvarez told Voice of San Diego that he couldn’t discuss the nature of his work at the Water Authority because his contract obligates him to maintain confidentiality. But Alvarez said he would not describe the nature of the work as lobbying.

As a former San Diego city councilman, Alvarez said he’s been in plenty of closed-session meetings to discuss confidential information, which usually pertains to possible litigation.

“We heard hundreds of cases and there’s info that puts an agency at risk and you have to maintain it as confidential,” Alvarez said. “But public information should be made available to the public.”

Whether these confidential contracts should indeed be confidential is a matter of legal interpretation.

Cate, the San Diego councilman and representative, said he also requested a list of all the Water Authority’s consulting contracts, and couldn’t get them. Cate asked for the confidential ones, and said the Water Authority didn’t hand them over. Instead, he said he was told if he wanted to review them, he’d have to come to the agency’s Kearny Mesa headquarters and view them in person, which he hasn’t done yet.

“There’s a strain on the relationship and there’s an obvious lack of trust,” Cate said of the Water Authority and some of its board members and general managers of the various water districts. “My perception is that it goes both ways.”

Correction: An earlier version of this story misstated how much the Water Authority spent on contracts it did not disclose to the board. The agency spent $167,000 on two consultant contracts since July 2019 without disclosing them to the board. It also won’t say what a third contract that was approved by the board, worth more than $330,000, was for.

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