Lara Introduces Bill to Improve Accountability at Central Basin Water District

February 05, 2016

SACRAMENTO, CA - Senator Ricardo Lara (D-Bell Gardens) introduced Senate Bill 953 today to implement recommendations made by the California State Auditor to improve transparency and accountability of the Central Basin Municipal Water District. 

"Our ratepayers are the ones bearing the burden of mismanagement of their funds by the Central Basin Municipal Water District," said Senator Lara. "It's time that we hold the leadership of this Board accountable for the decisions they make, with ratepayer money."

In 2014, the County of Los Angeles Department of Public Works (LADPW) surveyed the District’s operations after several media reports called attention to questionable actions made by the Board. In 2010 the Board violated state law by establishing a legal trust fund without disclosing its existence publicly. The expenditures from the $2.75 million trust fund were often appropriations unrelated to the mission of the District and could constitute gifts of public funds. LADPW recommended an audit to further investigate the District’s management and operations.​ In December 2015, the California State Auditor’s Office released their audit findings in a long and detailed report of the Central Basin Water District finding inconsistent leadership, a lack of strategic planning and oversight, and poor contracting practices. The report also found that critical responsibilities such as creating long-term financial plans had not been implemented. The District endured a $2.9 million operating deficit in three of the past five fiscal years. The Board’s expenditures reflected the mismanagement of funds as members received generous allowances for communication devices, transportation allowances, and compensation practices. Also, the staff hired incurred unnecessary expenses out of the scope of their position. Because of the Board’s inaction, the District received two credit rating downgrades.​ The report also revealed that six different individuals served as executives between 2010 and 2015. The inconsistencies in leadership contributed to the District’s ineffective governing structure. At times when a competitive-bidding process would have been more cost-effective for the District, the Board inappropriately sole-sourced contracts, creating more unnecessary costs.

Senate Bill 953 will implement some of the Auditor's recommendations, including the following:

  • ​Allowing the District to sole source contract in limited emergency circumstances and only with prior written justification.
  • Improving transparency by requiring the general manager to submit a quarterly report to the Board detailing the District’s contracts.
  • Preserving the District as an independent entity but modifying its governance structure by authorizing the Los Angeles County Board of Supervisors to appoint two additional members to the District’s Board of Directors.​