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Extracted from Consolidated Report
This investigation was originally published as part of a larger consolidated report containing multiple investigations. View the consolidated PDF for the complete document.
Shasta County Grand Jury
• 2015-2016
summer term of June and July. During the non-summer months Crag View CSA 23 should have received water through Cassel
⚠️ Translation Notice: This content has been automatically translated. The original English text is the official version. Translation may contain errors.
⚠️ Este contenido ha sido traducido automáticamente. El texto original en inglés es la versión oficial. La traducción puede contener errores.
Findings 11 findings
F1
Page 26
The Water Agency/CSA Master Contracts with reference to U.S. Bureau of Reclamation Master Contract #14-06-200-3367A are outdated.
F2
Page 26
The Water Agency had no contractual right to purchase and charge water beyond the specific months (June and July) identified under Crag View CSA 23 “Replaced Water Contract.”
F3
Page 26
The Water Agency over-purchased water from McConnell Foundation during 2014 and 2015 on behalf of Crag View CSA 23 and Keswick CSA 25, causing the CSAs to be overcharged. In addition the Water Agency absorbed losses from over-purchases.
F4
Page 26
The 2014 overcharge for Crag View CSA 23 totaled $1,450.69, and Keswick CSA 25 totaled $16,872.34. Both Crag View CSA 23 and Keswick CSA 25 are due a refund. The projected amount of over-purchase and refund due to the CSAs will contractually occur for 2015.
F5
Page 26
The total loss absorbed by the Water Agency for 2014 is projected to similarly occur for 2015.
F6
Page 26
The same employee preparing the annual water agency billings to the CSAs is also approving the billings for payment. This lack of segregation of duties does not provide proper checks and balances to prevent errors. 17
F7
Page 27
The Board of Supervisors acting as the Board of Directors of the Water Agency appears to be in possible violation of Government Code 53756, as it does not comply with all four elements for an automatic rate increase. Automatic rate increases can only occur for wholesale water purchases from a “public agency” (emphasis added). The McConnell Foundation water purchases appear to violate the provisions of the Government Code, because the McConnell Foundation is a private entity.
F8
Page 27
Public Works failed to schedule a timely inspection of the newly installed Crag View CSA 23 Water Treatment Plant with the State Water Resources Control Board.
F9
Page 27
Public drinking water for Crag View CSA 23 has contaminant levels reported in the 2014 Consumer Confidence Report for both TTHM at 88.40, and HAA5 at 100, which exceeds the allowable levels of the State Drinking Water Regulations for safe drinking water.
F10
Page 27
The Board of Supervisors appears to have failed to ensure that the CEO worked with staff and Jones Valley residents to see if some of the issues identified could be resolved.
F11
Page 27
The Shasta County Water Agency financial records reflect that it is sufficiently funded and covers expenses with appropriate cash flow to function independently from Public Works.
Recommendations 12
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R1Page 27The Grand Jury recommends that no later than September 30, 2016, the Board of Supervisors adopts a plan to ensure that the Shasta County Water Agency replaces all contracts for all CSAs for wholesale water supply, as the U.S. Bureau of Reclamation Master Contract #14-06-200-3367A was replaced with Master Contract #14-06-200-3367A LTR1.
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R2Page 27The Grand Jury recommends that no later than December 31, 2016, the Board of Supervisors conducts an audit of all CSA Master Contracts with the U.S. Bureau of Reclamation to ensure that water purchases are made as provided under the provisions of the Master Contracts.
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R3Page 27The Grand Jury recommends that no later than December 31, 2016, the Auditor-Controller independently audits all CSAs and Water Agency financial records to ensure that water purchases and overcharges are appropriately refunded, and that sufficient measures are in place to prevent future errors.
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R4Page 27The Grand Jury recommends that no later than September 30, 2016, the Auditor-Controller refunds or credits the overcharges to Crag View CSA 23 in the amount of $1,450.69, and Keswick CSA 25 in the amount of $16,872.34, for water year 2014. The Grand Jury also recommends that the Auditor-Controller reviews overcharges for 2015 and refund or credit both Crag View CSA 23 and Keswick CSA 25 as appropriate.
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R5Page 27The Grand Jury recommends that no later than September 30, 2016, the Board of Supervisors initiates an internal audit of all financial transactions within the Water Agency to identify any and all losses not identified in the Grand Jury Report as a result of the over- purchase of water.
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R6Page 27The Grand Jury recommends that no later than December 31, 2016, the Board of Supervisors reviews current practices to ensure that Public Works employees do not perform duties that allow both approving and overseeing their own work. This includes creating a policy to segregate duties to avoid conflict of interest, loss of revenue, and mismanaged billing/purchasing procedures. 18
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R7Page 28The Grand Jury recommends that no later than September 30, 2016, the Board of Supervisors revises applicable County Ordinances for Castella CSA 3, Jones Valley CSA 6, and Keswick CSA 25 to remove any automatic rate increase if determined through legal review to be in violation of Government Code 53756. The recommendation includes review of all other CSA County Ordinances to ensure that the County is in compliance with the Government Code.
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R8Page 28The Grand Jury recommends that no later than December 31, 2016, the Board of Supervisors obtains proof that corrective action was taken regarding the five findings in the State Water Resources Control Board 2015 Inspection Report of Crag View CSA 23 Water Treatment Plant.
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R9Page 28The Grand Jury recommends that no later than September 30, 2016, the Board of Supervisors instructs the Public Works Director to develop written policies and procedures directing that all State Water Resources Control Board inspections of CSA facilities be scheduled and conducted in a timely manner to ensure public health and safe drinking water. The Grand Jury also recommends the Board of Supervisors annually review an inspection schedule of all CSAs under its authority.
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R10Page 28The Grand Jury recommends that the Board of Supervisors establishes and implements a plan for Crag View CSA 23 for immediate corrective action to reduce, now and in the future, levels of TTHM and HAA5, which exceed the State Drinking Water Regulations maximum contaminant levels for safe drinking water. Because the levels are hazardous to the public, contaminant levels should be brought within allowable levels
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R11Page 28The Grand Jury recommends that no later than December 31, 2016, the Board of Supervisors develops a written procedure that establishes a timeline when addressing concerns (such as the Community Advisory Board’s request from the April 3, 2013, meeting regarding a feasibility study where follow-up is required by staff to conclusion).
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R12Page 28The Grand Jury recommends that no later than December 31, 2016, the Board of Supervisors initiates a feasibility study to establish an independent Water Agency, separate from any County structure such as the Public Works, with its own independent staff.