Graton Community Services District*

R1

This Recommendation has been implemented.

R2

This Recommendation has been implemented; full implementation is infeasible.

R3

This Recommendation has been implemented.

R4

This Recommendation has been implemented.

R5

This Recommendation will not be implemented because it is not warranted or reasonable

R6

This Recommendation will not be implemented because it is not warranted or reasonable

R7

This Recommendation will not be implemented because it is not warranted or reasonable

R8

This Recommendation has been implemented, since 2004.

R9

This Recommendation has been implemented prior to 2012-2013 Grand Jury.

R10

This Recommendation has been implemented since 2003 monthly.

R11

This Recommendation will not be implemented because it is not warranted or reasonable.

R12

This Recommendation will be implemented. BACKGROUND: The function of the Graton Community Services District (hereafter "GCSD") is to convert sewerage into clean water that is no longer a public health hazard. The Board's function is to see that the District does this. We excel at this task. Community Services District Law, Government Code 61000, specifically states that a Board's job is to set policy and to hire a General Manager to carry it out, not to be handling the day-to-day business of a District. The District did hire an experienced General Manager to do so, and the Board's functions are to set direction and policy, and to make sure that our wastewater treatment plant does what it is mandated to do-to treat wastewater. There have been three Grand Jury investigations of the Graton Community Services District and Board in ten years; to date, no wrongdoing has ever been found. Thus, such Grand Jury investigations are a waste of Sonoma County taxpayers' money. The following is the GCSD response to the latest Grand Jury findings and recommendations, It is very popular for the Grand Juries to censure the GCSD Board for rate increases over the past 10 years without taking into consideration the deluge of new wastewater treatment mandates, and changes in the unfunded legal requirements that have been imposed by Federal, State and Regional Agencies, which carry penalties for non-compliance. For example, we used to have to test for chlorine once per month; now we have to test daily, almost a 400% increase in mandated costs. As Unpaid <i>volunteers</i>, GCSD Board members put in 10-20 hours most weeks, keeping up with procedures, mandates, communications, policy, financing and other difficult topics. Graton has almost finished construction of a new state of the art treatment plant, after the current Board brought in 11.5 million dollars in grants and other funds that the ratepayers do not have to pay for! Our rates, with a new plant that is already compliant with upcoming mandates, compare quite well with neighboring communities: Graton: $1,574 per ESD Occidental: $1,682 and they don't even have a treatment plant or plan yet! Forestville: $1,375.61 while their new Sonoma County Water Agency-designed plant is failing (and has had over 80 violations in the past 3 years; they will require HUGE rate increases to fix or rebuild it.) Compared with other Districts in the region Graton is in excellent condition, it is in full compliance, and delivering services at an unbelievably low cost to our ratepayers. And yet, the district is regularly criticized by people who are unaware of history or facts. The Board understands that it is only natural for our rate-payers to be concerned about rate increases. It should be noted that our Board members are also ratepayers in this District, and have had one goal only: to keep our rates as low as possible. FACT: Community Services District law Gov't Code 61000 states that a Board's job is to set policy and hire a GM to carry it out, not to be handling the day-to-day business of a District. FACT: The current plan and plant are the result of long range planning done by the Board over the past decade. The local ratepayers who have volunteered to serve on the Board did so for one reason only: to keep rates as low as possible. A plan that may be less costly to implement now often costs more over the long run (as is Forestville's failing plant); this is a principle the Board has worked diligently to overcome. FACT: Everything costs money. Our long-time volunteers on the GCSD Board have done their best to avoid unnecessary costs. Until recently, Board members, serving as representatives of the ratepayers, had choices to make such as: Do we spend our time and energy to publish a newsletter, or do we work on avoiding violations and ensuing fines? With few if any volunteers willing to serve on any committees or help in any way until recently, the Board had to pick and choose priorities. Perhaps some would have chosen differently, but we chose to avoid fines, treat wastewater, obtain the resources to construct a facility to achieve compliance with the Basin Plan, and address/prevent floods, any of which would have raised our rates. The Board believed if anyone wanted to know what was happening with the sewer, they would come to any public meeting and ask or observe, thereby saving the cost of publishing a newsletter until we had the time and money. FACT: EVERYTHING COSTS MONEY. The Board can do all the things that the rate-payers want done, but it will cost a lot of money and require large rate increases. FACT: The Graton District Board of Directors and Staff of GCSD brought into the district more than $11.5 million dollars outside of rate base; this means the rate-payers do not have to pay it. This money was needed to fix enormous problems left by years of Sonoma County Water Agency neglect. Graton would be fined for this neglect and our locally controlled district would have lost its hard-won autonomy to SCWA if we had not obtained FEMA, Proposition 50 and SRF funds, and low-interest loans, or done a survey to qualify for these funds. No other small district in the entire State has done as much. We are constructing a state-of-the-art first in the world sustainable system free of chlorine toxicity. And the best part: it is less expensive than any alternative! The Report cites the example of the GCSD Board allowing its General Manager to operate "outside the limits of his prescribed responsibilities as set forth in the Handbook". The outdated nature of the original Policy Handbook was described in detail during interviews with the GCSD Board. However, the Report focused on a concern about the increase of purchasing authority granted to the General Manager without considering that the costs of urgent operations—the realities of managing a sewerage (public health hazard) treatment facility in real time—have greatly increased since the original Handbook was written well over a decade ago. This increase in the General Manager's discretionary spending limit was publicly discussed and properly voted upon by the Board at a public Board meeting. [See GCSD Resolution 100.] For example, what if a sewer line broke outside your house? Consider this: You probably would not want the General Manager (GM) to issue a Request for Bid and then wait for the required three bids (which may take more than two weeks); you probably would not like to then wait 72 hours for the posting of a special emergency meeting by the Board to approve the work; you would probably want the break fixed within the day; a broken sewer line usually requires a backhoe and operator, a dump truck and driver, a licensed engineer and/or plumber, suppliers of new pipe (trucks and drivers), mandated safety personnel (flaggers), cleanup, and tipping/removal. For situations such as this, the General Manager's maximum expenditure allowance has been increased to $25,000 without special Board approval. This is more than the decades-old Handbook allows, but it allows for rapid repairs to keep raw sewage away from your home. Although the General Manager is authorized to spend up to $25,000 without Board approval, it should be noted that for any non-emergency expenditure over $2,000 authorization is ALWAYS obtained beforehand. Consider this alternate scenario: If a major pump breaks during a storm, the GM has the authority to immediately spend up to $25,000 for a new one; or alternatively, we could put it out to bid, then call an emergency meeting to review and approve a bid, all the while discharging raw sewerage into local waterways; the fines for such an occurrence are normally astronomical! Regarding the General Manager's contract. He is under contract as an independent contractor. As such, the District does not pay for his health insurance, a retirement plan, the employer's share of FICA deductions, deductions for Medicare, and other related employee benefits. One of the IRS imperatives to qualify for the status of "independent contractor" is the requirement of performing services for more than one employer. If our current GM did not perform service for other organizations, he could not be considered an "independent contractor"; this, in turn, would require the District to pay the aforementioned taxes out of our budget. The Grand Jury expresses the opinion that the GCSD should convert our current GM's status to "employee" without offering any justification for increasing the District's employee expenses, which would ultimately increase sewer rates. As General Manager, the current position does report directly to the Board. Our GM is licensed and accountable, both civilly and criminally, for violations that occur at our facility. Community Services District ordinance and Gov't Code 61000 specifically states that a Board's job is to set policy and hire a GM to carry it out, not to be handling the day-to-day business of a District. With this in mind, the district will respond to the Civil Grand Jury's Findings and Recommendations.