Score: -9 (2/2/11)

Nevada County Grand Jury • 2021-2022

Nevada Irrigation District: Troubled Waters

Published: June 29, 2022 16 pages

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⚠️ 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 and Recommendations 10 findings

There is a significant disparity between the costs for raw, untreated water sold to Grass Valley and Nevada City compared to the cost to agricultural customers.

Related Recommendations (2)

Conduct a comprehensive review and adopt a rate structure to align the cost of water provision to treated water and agricultural customers.

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

The NID cannot sustain the current subsidizing of low agricultural rates from internal reserves.

Related Recommendations (1)

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

The NID cannot financially continue to provide low-cost agricultural water to customers who do not produce an agricultural product.

Related Recommendations (1)

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

The NID has no requirement for a consumer of raw, untreated water to produce an agricultural product.

Related Recommendations (2)

Develop, adopt, and implement a procedure to identify raw water users who do not produce agricultural products.

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

The failure to adequately increase raw water rates is creating a significant disparity in the costs of operation between the treated and untreated, raw water rates.

Related Recommendations (2)

Conduct a comprehensive review and adopt a rate structure to align the cost of water provision to treated water and agricultural customers.

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

The NID Board has placed the district at financial risk by failing to raise the rates of raw, untreated water to agricultural users.

Related Recommendations (1)

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

The NID failed to follow statutes in the California Elections Code during the reapportionment processes in 2019 and 2022.

Related Recommendations (1)

Develop and implement a plan and procedures for future reapportionment processes.

The Board placed NID in legal jeopardy of a lawsuit by failing to heed NID legal counsel’s advice regarding reapportionment.

Related Recommendations (1)

Develop and implement a plan and procedures for future reapportionment processes.

The Board has exhibited a disregard for the Brown Act as outlined in the California Government Code and NID policies regarding California’s open meeting laws.

Related Recommendations (1)

Comply with California’s open meeting laws.

F10

The NID has failed in the implementation of their Board Policy and has demonstrated organizational dysfunction in the areas of trust and communication.

Related Recommendations (1)

Develop and implement team building exercises to address the current dysfunction among Directors and between NID staff, administration, and the Board.

Additional Recommendations 1

These recommendations are not explicitly linked to specific findings.

R5

Develop and implement policies and procedures for the review of District boundaries when NID annexes parcels into the NID.

Comments 9

CO1 Page 13

defining a special district as a public agency
CO2 Page 13

requiring a public agency to notice the public of the items on an agenda of a regularly scheduled meeting of the governing board of the public agency at least 72 hours in advance of the scheduled meeting
CO3 Page 13

requiring the governing board of a public agency to only discuss items on the agenda at a legally scheduled and noticed Board meeting, and
CO4 Page 13

limiting Board members from discussing any item which is on the agenda for a Board meeting, outside of a public board meeting and limiting a Board member from discussing said item to more than one other Board member The Brown Act requires openness in government. An improper “serial meeting” may occur by a “hub and spoke” sequence. In this scenario Member A (hub) contacts Member B (spoke) regarding an issue on an item within the legislative body’s jurisdiction and scheduled to come before the Board for discussion and/or a vote. Member A (hub) then separately contacts Member C (spoke) regarding the same item. In the process, information about the members’ respective views is revealed. During the inquiry, the Jury found a pattern of violations of open meeting laws by the Board. Interviews and written communications show that on several occasions, the Board was offered advice by NID management and legal counsel regarding the appearances and violations of the Brown Act. The following are instances of these violations:
CO5 Page 13

A Director (hub) stated, in an open Board meeting, that they had met with each Director individually (spoke) and had discussed items to be placed on the Board’s agenda in the coming year.
CO6 Page 13

A Director (hub) openly acknowledged, in a written memorandum to the Board, via NID staff, that they had met with two other Directors (spokes) to deliberate on an item to come before the Board in an upcoming Board meeting. The Director (hub) stated they had the support from the two Directors (spokes). The Director (hub) voiced personal support of action to be taken on the item. When confronted with this memorandum, the Director (hub) pulled the item from the agenda.
CO7 Page 14

attended a local town hall meeting
CO8 Page 14

attended a board meeting for a local non-profit and shared highlights
CO9 Page 14

participated in an event regarding climate change On one occasion, a Director opened a Director’s Report by saying, “I don’t have anything to report, but I do have a comment.” The Director stated their support for and commitment to the completion of an item which had appeared on the Board’s agenda in the past and will appear on the Board’s agendas in the future. The Director also voiced that this would be an item on which the Director would base their re-election campaign. This item was not on the agenda for this meeting. Discord, Mistrust, and Acrimony Nevada Irrigation District Policy Manual Section 4010.1.4 states: The primary responsibility of the Board of Directors is the formulation and evaluation of policies, goals, and objectives to be pursued by the District in carrying out its mission, and in gauging the success of the District in meeting the Board’s directives. Routine matters concerning the operational aspects of the District are to be delegated to professional staff members of the District. Further, Section 4010.2 states: The work of the District is a team effort. All individuals should work together in the collaborative process, assisting each other in carrying out the mission of the District. The Jury learned of discord, mistrust, and acrimony among the Directors and between NID Board, management, and staff. The Jury was told that the Board was trying to “micromanage” the staff by going around management and giving orders directly to staff. The Jury learned that some Directors felt that the former management did not like them or was trying to “get” them. Similar statements were made regarding current management. There were complaints that Directors received incomplete staff reports lacking pertinent information on agenda items on which the Directors must make decisions. Directors did not trust or seek Counsel’s opinions because Counsel was a friend of management and thus, did not trust legal advice given to them by Counsel. The Jury found a pervasive sense of dysfunction in the NID which affects the health and stability of the organization.

Agency Responses 1

Government agencies' official responses to this report's findings and recommendations. Click on a response to see the structured breakdown.

NID

September 28, 2022 • 5 pages • 17 responses • Score: -9 (+2, 2, -11) View Details ▾

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17 responses to findings and recommendations

There is a significant disparity between the costs for raw, untreated water sold to Grass Valley and Nevada City compared to the cost to agricultural customers.

Response: Disagree Partially Score: 0

Partially Agree with Finding. The cities of Grass Valley and Nevada City are not located within the District's boundaries and are considered out of District customers. The District receives property tax revenue from parcels that are located within District boundaries and does not receive property tax revenue from parcels that are located outside of the District's boundaries. Due to the inability to collect property tax from parcels located outside the District, the rates for raw water are increased to address the discrepancy in total revenue collected. Additionally, in District customers recei...

Conduct a comprehensive review and adopt a rate structure to align the cost of water provision to treated water and agricultural customers.

Response: Will Implement

Score: +1

Accept recommendation and will implement. The District will initiate a new rate setting public process in late 2022 and will likely complete the process in 2023. R2 Develop, adopt, and implement a procedure to identify raw water users who do not produce agricultural products. Response: Recommendation will not be implemented. NID already requires customers to indicate whether or not they are using raw-water for agricultural purposes and requests identification of the crop that they are watering. This is how the District's annual crop report is completed. R3 Develop and implement a policy to dif...

The NID cannot sustain the current subsidizing of low agricultural rates from internal reserves.

Response: Disagree Score: -1

Disagree with finding Irrigation water rates are not subsidized by internal reserves. Each reserve has a specific purpose and monies designated for reserve can only be utilized if the Board determines that the use is consistent with the stated purpose. Please note that the District does not have an agricultural rate, and instead established a rate for raw water that is utilized for any authorized use including irrigation. F3 The NID cannot financially continue to provide low-cost agricultural water to customers who do not produce an agricultural product. Response: Disagree with finding. Propos...

Develop, adopt, and implement a procedure to identify raw water users who do not produce agricultural products.

Response: Will Not Implement

Score: -1

Recommendation will not be implemented. NID already requires customers to indicate whether or not they are using raw-water for agricultural purposes and requests identification of the crop that they are watering. This is how the District's annual crop report is completed. R3 Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers. Response: Recommendation will not be implemented. At this time the District declines to implement this recommendation. There are many legal and policy related issues that need to be analyzed to determine w...

The NID cannot financially continue to provide low-cost agricultural water to customers who do not produce an agricultural product.

Response: Unknown Score: 0

, Proposition 218 requires the District to charge rates for water service that have a direct proportional relationship to the cost to provide service to any specific rate payer class. There is currently no fundamental difference between the cost to provide raw water to a commercial agricultural customer versus a non-commercial agricultural customer. Additionally, in-District customers have a right to water service from the District for reasonable and beneficial uses of water. R4 Develop and implement a plan and procedures for future reapportionment processes. Response: Recommendation will not ...

Develop and implement a policy to differentiate the water rates for non-agricultural and agricultural water customers.

Response: Will Not Implement

Score: -1

Recommendation will not be implemented. At this time the District declines to implement this recommendation. There are many legal and policy related issues that need to be analyzed to determine whether a different rate for raw water can or should be charged for non-agricultural and agricultural products. As noted in the response to

The NID has no requirement for a consumer of raw, untreated water to produce an agricultural product.

Response: Agree Score: +1

Agree with finding. NID is legally obligated to provide water to in-District customers that have a right to service. The right to service is for all uses of water that are reasonable and beneficial. There is currently not a provision in California law that requires water to only be used for agricultural products. Reasonable and beneficial use of water extends to multiple other uses, including irrigation that does not involve an agricultural product (e.g., irrigation of ornamental landscape). Regardless, all irrigation water customers are required to report to NID what irrigation water will be ...

Develop and implement a plan and procedures for future reapportionment processes.

Response: Will Not Implement

Score: -1

Recommendation will not be implemented. The division boundary reapportionment process is contained within the Election Code and the Irrigation District Act. R5 Develop and implement policies and procedures for the review of District boundaries when NID annexes parcels into the NID. Response: Recommendation will not be implemented. The division boundary reapportionment requirements and process related to new annexation is already contained within the Election Code and Irrigation District Act. 5.1 Page 5 of 5 R6 Comply with California's open meeting laws. Response: Recommendation already implem...

The failure to adequately increase raw water rates is creating a significant disparity in the costs of operation between the treated and untreated, raw water rates.

Response: Disagree Score: -1

Develop and implement policies and procedures for the review of District boundaries when NID annexes parcels into the NID.

Response: Will Not Implement

Score: -1

Recommendation will not be implemented. The division boundary reapportionment requirements and process related to new annexation is already contained within the Election Code and Irrigation District Act. 5.1 Page 5 of 5 R6 Comply with California's open meeting laws. Response: Recommendation already implemented. The District continues to comply with California's open meeting laws. R7 Develop and implement team building exercises to address the current dysfunction among Directors and between NID staff, administration, and the Board. Response: Partially accept recommendation. There is not widesp...

The NID Board has placed the district at financial risk by failing to raise the rates of raw, untreated water to agricultural users.

Response: Disagree Score: -1

Disagree with finding. The District is not at financial risk. The Grand Jury provides no information to substantiate the finding. Rates for all customers will be evaluated during the rate setting process that will be completed in 2023. Currently, the District is not utilizing reserved monies for ongoing operational expenses. However, it should be noted that long-term capital improvements to the District's infrastructure will likely require increased revenue collection. Page 3 of 5 F7 The NID failed to follow statutes in the California Elections Code during the reapportionment processes in 201...

Comply with California’s open meeting laws.

Response: Implemented

Score: 0

Recommendation already implemented. The District continues to comply with California's open meeting laws. R7 Develop and implement team building exercises to address the current dysfunction among Directors and between NID staff, administration, and the Board. Response: Partially accept recommendation. There is not widespread dysfunction between the Board and staff. However, team building exercises can be beneficial and will be considered when appropriate and when such exercises can be undertaken within the confines of the Brown Act. Thank you for the opportunity to comment on the Grand Jury Re...

The NID failed to follow statutes in the California Elections Code during the reapportionment processes in 2019 and 2022.

Response: Disagree Score: -1

Disagree with finding. The Irrigation District Act, Water Code section 21605 states that NID "shall, by resolution, adjust the boundaries of any divisions pursuant to Chapter 8 (commencing with Section 22000) of Division 21 of the Elections Code." Elections Code section 22000(a) requires that NID adjust its division boundaries following each decennial census. As such, division boundary adjustments should have been considered after the 2010 census and were not. Elections Code section 22001 states: "Before adjusting the boundaries of a division pursuant to Section 22000 or for any other reason, ...

Develop and implement team building exercises to address the current dysfunction among Directors and between NID staff, administration, and the Board.

Response: Unknown

Score: 0

Partially accept recommendation. There is not widespread dysfunction between the Board and staff. However, team building exercises can be beneficial and will be considered when appropriate and when such exercises can be undertaken within the confines of the Brown Act. Thank you for the opportunity to comment on the Grand Jury Report. Please contact us if you have any questions or if you require additional information. Sincerely, Chris Bierwagen President, Board of Directors Nevada Irrigation District 77 . . 55 11.3 100 9 1.7

The Board placed NID in legal jeopardy of a lawsuit by failing to heed NID legal counsel’s advice regarding reapportionment.

Response: Disagree Score: -1

Disagree with finding. The legal jeopardy associated with not completing redistricting in 2019 did not increase any legal risk to the District. The risk level remained the same as the redistricting should have been completed shortly after the 2010 census was completed. It should also be observed that no lawsuits were initiated concerning reapportionment. F9 The Board has exhibited a disregard for the Brown Act as outlined in the California Government Code and NID policies regarding California's open meeting laws. Response: Disagree with finding. The Board does not exhibit a disregard for the B...

The Board has exhibited a disregard for the Brown Act as outlined in the California Government Code and NID policies regarding California’s open meeting laws.

Response: Disagree Score: -1

Disagree with finding. The Board does not exhibit a disregard for the Brown Act. The Board of Directors receives Brown Act training every two years and is committed to conducting NID business in the public sphere as required by the Brown Act. F10 The NID has failed in the implementation of their Board Policy and has demonstrated organizational dysfunction in the areas of trust and communication. Response: Disagree with finding. There is not widespread organizational dysfunction. The District does not agree that there is widespread failure to implement Board Policy. There is, however, conflicti...

F10

The NID has failed in the implementation of their Board Policy and has demonstrated organizational dysfunction in the areas of trust and communication.

Response: Disagree Score: -1

Disagree with finding. There is not widespread organizational dysfunction. The District does not agree that there is widespread failure to implement Board Policy. There is, however, conflicting policies, laws, and regulations that, from time to time, need to be reviewed and updated in a manner that is in the best interest of the District's Page 4 of 5 customers and tax payers. NID's Board of Directors continues to periodically review and update its policies. Dysfunction between the Board and staff is limited and is not experienced by the large majority of the Board Members and staff members. ...