Special Districts Committee Loretta Avery Tom Pasek, Chairperson Marilyn Nienke Donna Schaffel Mission Statement Penal

Comments 19

• CO1
  The District does not have a written agreement or contract with their legal counsel.
• CO2
  The agendas are prepared, and minutes are taken and transcribed by legal counsel at $245 per hour.
• CO3
  The legal counsel attends all Commission meetings, even when legal matters are not on the agenda.
• CO4
  Kern County Administrative Policy and Procedures Manual require special districts solicit competitive sealed bids for engineering and professional services exceeding $100,000.
• CO5
  All management responsibility has been delegated to the engineering firm by the Board of Commissioners.
• CO6
  Services from the engineering firm exceeded $106,000 in 2015.
• CO7
  Engineering and management services performed by the engineering firm exceeded $222,000 in 2016.
• CO8
  The District does not have written bylaws, or a Policies and Procedures Manual, as required by California Government Code §4526.
• CO9
  The District currently has one pump for the water treatment plant. The Facilities Manager would like to have a second pump, to prevent overload and to provide backup in case of failure.
• CO10
  The District is a member of the California Special Districts Association and the California Rural Water Association. COMMENTS: The Special Districts Committee thanks the Office Manager and the Facilities Manager for sharing their time, knowledge, expertise, and for the comprehensive information provided.
• CO11
  Union Pacific Railroad at: a) Morning Drive b) Olive Drive c) Snow Road d) Airport Drive (widening of an existing road underpass)
• CO12
  Burlington Northern Santa Fe Railway at: a) Beale Avenue/Truxtun Avenue/Baker Street b) Kratzmeyer Road c) Reina Road/Renfro Road/Jenkins Road
• CO13
  San Joaquin Valley Railroad at: a) Rosedale Highway H. The District’s primary focus is on railroad crossings. However, the District is also interested in, and empowered to, create grade separations for other types of intersections. These include streets, roads, highways, pedestrian walkways or any combination thereof, wherever such a separation of grade would be beneficial to the public. I. California State Government Code §4526 and Kern County Administrative Policy and Procedures Manual require special districts to obtain Request(s) for Qualifications (RFQ) for professional services. J. The Kern County Administrative Policy and Procedures Manual require special districts have a written agreement with all outside counsel or retained attorney(s). FINDINGS: F1. The District provides a service to the greater Bakersfield community by streamlining planning and eliminating financial conflicts between municipal jurisdictions. 2017-2018 Kern County Grand Jury 292 F2. Three of the five Commissioners must be residents of the City of Bakersfield, and two must be residents of the unincorporated area of Kern County. (See Appendix B) F3. In 2017, the District applied to the Kern County Local Agency Formation Commission for an expansion into a portion of the City of Shafter. That expansion is pending as of the writing of this report. F4. The District is the only Separation of Grade District in the State of California. F5. The District’s webpage is a subsection of the Kern County website, https://www.kerncounty.com/bos/boards/Grtr-bak.aspx, which does not allow public input. F6. The Commission posts all meeting agendas and minutes on the door to Suite 260, 1800 30th Street, Bakersfield, the office of the engineering company used by the District, as well as the building’s exterior front door. The agendas and minutes are not posted on the District’s webpage, and not readily available to the public, as required by the Ralph M. Brown Act. F7. The funding for grade separation construction stems from CPUC, CalTrans, and local sources derived from builders’ traffic impact fees, parcel taxes, and often from direct payments by railroads. F8. The District’s daily operating revenues are derived principally from property taxes/assessments. F9. The selection process for project funding is through a formula that primarily addresses historic traffic, accident rates, and anticipated future traffic volumes. F10. Before a prospective project can be moved from the status of having been “Nominated for Construction” to “Scheduled for Construction,” all funding must be in place, including local funding. F11. CPUC rules provide for resubmitting projects if any other scheduled plans lose funding, or other critical elements, that would preclude timely construction. The District stays abreast of the status of all projects state-wide so that they are prepared to resubmit a nomination, should the opportunity present itself. F12. Separations of grade projects are the only task performed by this District. Elsewhere in the State, separation of grade is one of a multitude of tasks undertaken by various departments within a city or county, whose priorities may be in conflict. This can give the greater Bakersfield area a decided advantage over other regions in the State. F13. The District pays $200 per month to the engineering firm for the monthly Commissioners’ Meeting, and for unsecured file space. 2017-2018 Kern County Grand Jury 293 F14. There is no record of competitive bidding for engineering or management services. F15. For over 15 years, the same engineering firm has been engaged for all pre- construction services. F16. The District has no record of any written agreement with the engineering firm, other than a “rate sheet.” F17. Since 1987, the District has used the same law firm as its retained legal counsel. F18. The District does not have a written agreement or contract with their legal counsel. F19. The agendas are prepared, and minutes are taken and transcribed by legal counsel at $245 per hour. F20. The legal counsel attends all Commission meetings, even when legal matters are not on the agenda. F21. Kern County Administrative Policy and Procedures Manual require special districts solicit competitive sealed bids for engineering and professional services exceeding $100,000. F22. All management responsibility has been delegated to the engineering firm by the Board of Commissioners. F23. Services from the engineering firm exceeded $106,000 in 2015. F24. Engineering and management services performed by the engineering firm exceeded $222,000 in 2016. F25. The District does not have written bylaws, or a Policies and Procedures Manual, as required by California Government Code §4526.
• CO14
  The Kern County Board of Supervisors and Kern County Employers’ Training Resource, should post a copy of this report where it will be available for public review.
• CO15
  Persons wishing to receive an email notification of newly released reports may sign up at: www.kerncounty.com/grandjury.
• CO16
  Present and past Kern County Grand Jury Final Reports and Responses can be accessed on the Kern County Grand Jury website: www.kerncounty.com/grandjury. RESPONSE REQUIRED WITHIN 90 DAYS TO: PRESIDING JUDGE KERN COUNTY SUPERIOR COURT 1415 TRUXTUN AVENUE, SUITE 212 BAKERSFIELD, CA 93301 CC: FOREPERSON KERN COUNTY GRAND JURY 1415 TRUXTUN AVENUE, SUITE 600 BAKERSFIELD, CA 93301 LOST HILLS UTILITY DISTRICT “LOST HILLS FOUND” PURPOSE OF INQUIRY: The 2017-2018 Kern County Grand Jury (Grand Jury), Special Districts Committee (Committee) conducted an investigation of the Lost Hills Utility District (District) pursuant to Penal Code §933.5. PROCESS: The Committee interviewed the Office Manager/Secretary (Office Manager) on February 13, 2018, and March 22, 2018, at the District Office, 21331 Highway 46, Lost Hills, California 93245. On March 1, 2018, the Committee attended a Board of Directors Meeting. The Committee researched the internet, interviewed the Facilities Manager, and inspected the fresh water treatment facility. The Committee contacted the Kern Local Agency Formation Commission (LAFCo) for information regarding the background of the District. The Committee also reviewed the Lost Hills Utility District Potable Water and Wastewater System Report, prepared by the District’s engineering consultants. BACKGROUND: The District was formed, under provisions of the California Health and Safety Code §§6400-6830, as the Lost Hills Sanitation District, for the purpose of providing a sewer system to the community of Lost Hills. The statutes of the Health and Safety Code govern the management of the District. The Lost Hills Sanitary District, formed in 1978, is presently part of the Lost Hills Utility District. There have been 18 annexations to the original District boundaries. The District has owned and operated the wastewater collection and treatment plant since 1981. In 1989 the Lost Hills Utility District purchased the water system, which was originally owned by the Chevron Corporation. The District changed its name in 1994 to the Lost Hills Utility District The District, located in Kern County, is approximately two miles west of Interstate 5, on both sides of State Highway 46. The District’s terrain is relatively flat, typical of the Central San Joaquin Valley, with a natural slope of one to two percent and a ground elevation of 250 to 300 feet above mean sea level. See Appendix A for map of District boundaries and Sphere of Influence. Based on the 2010 census data, the Median Household Income (MHI) in Lost Hills was $29,632, which was 48.6% of the California MHI and 57.1% of the U.S. MHI. The data showed the District was 97.6% Hispanic. 2017-2018 Kern County Grand Jury 299 FINDINGS: F1. The District is governed by a five member elected Board of Directors, each serving a four year staggered term. The Board holds monthly meetings at 5:00 PM on the first Thursday of each month. Currently there are only four Board Members. Appointment of the fifth Board Member is pending acceptance by the nominee. F2. Board Members are currently compensated $100 per meeting. At the March 1, 2018, Board Meeting, a resolution was passed to place a proposal for a 5% increase for Board Member stipends on the next ballot. F3. The District has four employees:  Office Manager/Secretary (Office Manager)  Facilities Manager  Assistant Water Supervisor  Receptionist F4. Monthly salaries are:  Office Manager $3,575 an additional $300 per month for gas and phone o  Facilities Manager $6,000  Assistant Water Supervisor $2,800  Receptionist $2,426 F5. The Office Manager, with input from the Facilities Manager, accumulates and provides the contracted Attorney with materials for the monthly meeting agenda. The Attorney reviews and oversees the preparation of the agenda, billing the District $180 per hour for this service. F6. The Office Manager prepares the monthly Board Meeting Packets. F7. The only contract on file for legal services with the Attorney is dated May 7, 1981. Subsequent actions made by the Board of Directors increased the billing rate to the current $180 per hour. F8. The average monthly Attorney’s fee was $5,512.50 for services from August 1, 2017 through January 31, 2018, for a total of $33,075.00. F9. The Attorney attends all Board Meetings. F10. The Office Manager records and prepares the Minutes of the Board Meetings, and includes them in the monthly Board Packets. 2017-2018 Kern County Grand Jury 300 F11. The Office Manager posts the Board Agenda, handles most of the accounting, and performs most of the duties typical of a general manager. The Office Manager, a 12-year employee, appears to be knowledgeable and competent. F12. The Agendas are only printed in English, and posted at the District Office, Post Office, and at a local market. F13. The Minutes are not publicly posted. F14. The Lost Hills Utility District does not have a website. F15. It appears that there may be a conflict of interest, as the Attorney represents both the District and LAFCo. The Attorney bills legal fees to the District for reviewing LAFCo generated documents, which he may have written on behalf of LAFCo. F16. The Board of Directors did not follow Roberts Rules of Order during the Board Meeting on March 1, 2018. It appears that during the meeting, the Attorney fulfilled the role of the Board President. The Vice President was observed instructing a Board Member which way to vote on an Agenda item. F17. The Committee observed the Board Members continuing to discuss District business after the meeting was adjourned, appearing to be a violation of the Ralph M. Brown Act. F18. The District uses its own staff for the daily operation and maintenance of the Water Treatment, Distribution System, and Wastewater System. F19. The District contracts professional services for engineering and accounting services on an as-needed basis. F20. The District contracts a Grant Writer, at the rate of $75.00 per hour, up to $5,000, to seek additional funding. Services exceeding $5,000 must be approved by the Board. F21. The Public Entrance to the District Office does not meet the Americans with Disabilities Act (ADA) handicap access or signage. F22. The Board Room entrance, located at the opposite end of the District Office Public Entrance, has steps and a handicap ramp; both were blanketed with very hard berries, presenting a walking and/or slipping hazard. F23. There are 299 residential, 109 commercial, and four multi-family dwelling water connections in the District. The metered water base rate was raised in May 2016, from $5.00 to $30.00 monthly. The new rate for the combined 2017-2018 Kern County Grand Jury 301 sewer and water now averages approximately $70.00 per month, depending on water usage. F24. The District does not accept cash or credit card payments. Payments must be made by check or money order. F25. The District’s water comes from two wells located north of Semi-Tropic School near Wasco on Gun Club Road. There are two storage tanks located approximately two miles west of the District Office. The District has water rights from the California Aqueduct (State Water Project), however, they do not currently use any of their allocation. F26. The District currently has one pump for the water treatment plant. The Facilities Manager would like to have a second pump, to prevent overload and to provide backup in case of failure. F27. The District is a member of the California Special Districts Association and the California Rural Water Association. COMMENTS: The Special Districts Committee thanks the Office Manager and the Facilities Manager for sharing their time, knowledge, expertise, and for the comprehensive information provided.
• CO17
  The Kern County Board of Supervisors, Mountain Meadows Community Service District, and Kern County Employers’ Training Resource, should post a copy of this report, where it will be available for public review.
• CO18
  The Stallion Springs Community Services District should post a copy of this report where it will be available for public review.
• CO19
  Persons wishing to receive an email notification of newly released reports may sign up at: www.kerncounty.com/grandjury.