Local Politics

Saturday, Oct 27 2012 10:30 PM

Problems, ethical and otherwise, flowing freely

By The Bakersfield Californian

What on earth is a Bakersfield city councilman doing in the middle of a water fight in Oildale? And I mean smack in the middle.

Russell Johnson, who represents Ward 7 waaaaaay to the south of Oildale, has been raking in between $1,500 and $2,000 a month doing "PR" for North of the River Municipal Water District.

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Lois Henry hosts "Californian Radio" every Wednesday on KERN 1180 AM from 9 to 10 a.m. You can get your two cents in by calling 842-KERN.

You may have missed my earlier columns about the ongoing Oildale water fracas, so here are the basics.

Oildale Mutual is a private, nonprofit company founded in 1919 to provide drinking water to Oildale. By the 1960s, it was clear the growing population couldn't rely on groundwater alone.

So, in 1969, North of the River Municipal Water District was formed overlying essentially the same boundaries as Oildale Mutual and another water company, Highland Knolls.

As a public agency, NOR collected property taxes and could float bonds to buy state water and build tanks, pipes and other facilities to supply Oildale Mutual and Highland Knolls, which then supplied customers.

NOR was the wholesaler and Oildale/Highland were the retailers.

Then in 1981, NOR took over Highland Knolls and got into the retail business.

That's where things went south.

Running retail and wholesale operations created a confusing billing system and eventually Oildale Mutual accused NOR of using wholesale money to fund its retail side. Oildale Mutual sued and in 1993 the two entered into a settlement agreement.

Things didn't improve.

Oildale Mutual began raising many of the same questions and complaints starting in 2005 and felt NOR was not forthcoming with information. NOR said it tried to work with Oildale Mutual to true up bills but that the company was never satisfied.

Oildale Mutual sued again.

NOR filed a cross complaint.

And so it goes.

-- Lois Henry

WHAT THE FUSS IS ABOUT

That's one problem but it's not all.

Johnson, whose company is called Common Sense Consulting, also was one of the key players in a mailer that came out in mid-October that I believe skirts the edge of a public

agency trying to influence an election. But we'll come back to that.

First, $2,000 a month is a lot of scratch for a tiny public agency with only six employees that's already been dinged for excessive spending to toss around on public relations. Johnson justified his pay saying he helps with NOR's online newsletter (five so far this year) and had helped coordinate three water awareness outreach events.

Good work if you can get it, I suppose.

***

Second, and more importantly, Johnson represents the City of Bakersfield and sits on its Water Resources Board. His work for NOR could present a conflict of interest. (It wasn't long ago that Bakersfield and NOR nearly came to legal blows when NOR was poised to be the middleman in a deal to get the City of Shafter more water.)

It's irresponsible of Johnson to dip his toes into more than one pond considering the local water world's penchant for round robin legal actions.

His response was that Bakersfield council members all have jobs and there's always a potential for conflict of interest.

"If that comes up, we recuse ourselves," he said.

No, sorry. This is more than the random conflict. Johnson has created an especially tricky minefield by being on the city's water board and taking work from a local water district. How are constituents of either entity supposed to keep up with his positions and his loyalties?

Johnson tried to cut me off, saying his work for NOR had nothing to do with his council seat.

"I don't want to talk about my work as a council member unless you have a specific question about that," he said. "Lets talk about what you called about, NOR."

I countered that I didn't believe he could sever the two. And, frankly, I think he needs to step down from either the city's water board or NOR.

Johnson didn't see it that way and said he had full discussions with Bakersfield's City Attorney about his NOR work. I asked if those were before or after he took the NOR gig in January.

"Why would I discuss it with the City Attorney before I got the job?" he said.

Oh, come on.

Of course it's important whether he sought the City Attorney's advice before getting in bed with NOR.

Ultimately, he said he didn't remember the dates and would get back to me. He didn't.

The reason I was curious is that Johnson did not bother to check the legality of sitting in on at least two closed sessions with NOR board members while they discussed a lawsuit filed against the district by Oildale Mutual Water Company.

That's a big no no.

The Brown Act, California's open meeting law, strictly limits closed sessions of public agencies to only the people who are required to be in attendance, such as lawyers, board members and witnesses. Johnson is a public relations consultant to NOR. There is no way he should have been in those meetings which, by the way, are closed to reporters and other outsiders.

When I brought up the closed session issue to Johnson, he had NOR's lawyer write up a legal justification and email it to me. Not only is the lawyer's take flat wrong, it was after the fact.

No one bothered to discuss whether it was OK to have Johnson in the closed session before he waltzed in.

"I assume my client (NOR) vetted whether it was proper for me to be in the closed session before inviting me in," Johnson said.

In both cases, checking with the Bakersfield City Attorney on conflict of interest and checking with the Brown Act, Johnson seems to be playing the old "easier to seek forgiveness than permission" game.

When it comes to transparency in conducting the public's business, officials would do well to remember it's not a game.

Either way, Johnson's been in public service for years on the Bakersfield City Council and Bakersfield Planning Commission. Before that he worked Supervisor Mike Maggard. He should well know the basics of the Brown act.

***

Back to that mailer I mentioned earlier.

NOR's board of directors has three seats up for election this year.

Oildale Mutual is openly backing three candidates for those seats, Jim Tyack, Dennis Meier and Ray Etcheverry. They are running against NOR incumbents Rebecca McClure and Jack Scoles and NOR retail customer Jim Coulter.

Many have complained that it's unfair for Oildale Mutual to use ratepayer money to fund a political campaign.

The water company has paid for signs (even having its employees place the signs), is the No. 1 donor to Concerned Citizens for Tyack, Etcheverry & Meier and pays campaign consultant Tracy Leach to run it all.

Legally speaking, Oildale Mutual isn't prohibited from getting involved in an election. Whether it's "right" is another matter up for debate.

The company's heavy involvement prompted McClure to file two complaints with the state Fair Political Practices Commission over how Oildale Mutual's support is reported. Leach has discounted the complaints.

Amidst all this finger pointing, a mysterious postcard popped into mailboxes about October 18.

It features Tyack, Etcheverry and Meier on the front with red crosses over the names. On the back it urges voters "NOT" to vote for any of these men and goes on a diatribe against Oildale Mutual saying the company is "SCHEMING to stack their BUDDIES on your Water District's Board by paying for these guy's political campaigns WITH YOUR MONEY."

It also claims Oildale Mutual gets millions in tax dollars, something Johnson repeated to me. That depends on how you look at it.

NOR gets property tax revenue, which the district uses to offset the cost of its water. Oildale Mutual pays the balance.

So, yes, Oildale Mutual get some benefit from the taxes, though it doesn't receive that money as revenue. But Oildale Mutual customers are also residents of NOR and are the ones paying the taxes anyway.

See what I mean about intertwined?

Anyway, the mystery mailer curiously listed Justice PAC, a Los Angeles-based political action committee, as its originator.

I won't bore you with the details of what it took to run all this down, but it turns out it was funded solely by NOR board member Steven Esselman.

He told me he felt it was the only way to combat the political onslaught from Oildale Mutual. He also had no ethical qualms about stepping into the race, saying he did it as an individual, not an NOR board members.

I do think it comes too close for comfort and can't help noticing that his name isn't on the mailer, making it very difficult to know where the information is coming from, unlike Oildale Mutual's involvement, which has been quite open.

I asked how Esselman got the name and contact information of this obscure Los Angeles-area PAC. It came from Johnson.

In fact, Johnson referred Esselman to his old college buddy Patrick Furey Jr., a small-time political operative out of Torrance who is loosely affiliated with Justice PAC and works for Liberty Campaign Solutions, which created and sent the mailers.

That's pretty cozy. Far more cozy than Johnson led me to believe when I first asked him about Furey and Justice PAC.

"My firm has not done candidate campaign work since 2010. When needed I refer folks to people who do, Mr. Furey is one of those many people," was his initial response.

Sigh.

This fight between Oildale Mutual and NOR has been going on for 20 years. Without a dramatic change, such as one taking over the other, it'll likely continue for 20 more.

No one needs to fan the flames. Certainly not a Bakersfield city councilman.

Opinions expressed in this column are those of Lois Henry, not The Bakersfield Californian. Her column appears Wednesdays and Sundays. Comment at http://www.bakersfield.com, call her at 395-7373 or e-mail lhenry@bakersfield.com

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