December 30, 2020
By KAREN VELIE
San Luis Obispo County has spent years rejecting claims that the San Simeon community service district has violated government grant-related bidding rules. Now, the state of California has ordered the county to investigate why it serves as the manager of three concessions.
The allegations that the district had not won bids for employment contracts started in 2017. Area residents and local activists asked San Simeon officials and the SLO County Council to examine the district’s alleged failures to place large contracts in bidding. However, public officials rejected their attempts.
San Simeon CSD started applying for grants for improvements to its water system in 2016. Two years later, during a San Simeon CSD Council meeting on June 18, 2018, district manager Charles Grace asked the council to approve a $ 225,960 non-bid contract.
The contract, for engineering and design of drinking water reservoir, would be with Phoenix Engenharia, according to the minutes of the meeting. The council voted unanimously to approve Grace’s request.
During public meetings, residents complained that the district did not comply with Government Code 4529.12, that “all architectural and engineering services must be purchased in accordance with a competitive and fair selection process”. CSD officials from San Simeon replied that the contract was not for engineering or design, but for professional services, allowing them the sole source of the work.
Prior to the board meeting, Henry Krzciuk, a resident of San Simeon, contacted the Office of State Controllers for clarification on the bidding requirements. State policy analyst Alexandria Green noted in an email that, even if the contract was for professional services and not for engineering or design, she would still have to go out to bid if the cost exceeded $ 45,000. In that case, the contract was $ 225,960.
SLO County became involved in July 2019, when it signed an agreement with the San Simeon CSD to administer and distribute the grant. The deal was approved by SLO County attorney Rita Neal.
Krzciuk then asked Neal to investigate the award of the contract without bidding. He forwarded an email from the Office of State Controllers about the requirement to bid for professional services over $ 45,000, noting that district attorneys Natalie Frye Laacke and Jeffrey Minnery supported the decision not to bid on the contract, according with the Charter of September 30, 2020 to Neal. Minnery and Frye Laacke are members of the Adamski, Moroski, Madden, Cumberland & Green law firm.
“There is no evidence of a fair and competitive selection process for this engineering work, as required by the grant contract and state law,” wrote Krzciuk in the letter. “Several objections to this single source are registered.”
On October 14, Neal informed Krzciuk that she would not investigate the matter based on Minnery’s interpretation of the law and in the email from the state controller, which conflicted with Minnery’s interpretation.
“When analyzing the information, it appears that you disagree with the legal interpretation made by the San Simeon CSD attorney, as well as with the information provided to you by the State Controller Office,” wrote Neal, making it appear that the state agreed with Minnery.
Krzciuk turned to the State Department of Water Resources, which had granted the concession, to investigate the lack of bidding for the contract. This prompted the state to order the county, as the grant administrator, to conduct an investigation.
On December 21, the county ordered the district to respond to a long list of questions and registration requests for three state grants approved by the state in the past four years, according to a letter from John Diodati, acting director of public works for the district. SLO county. In addition to asking questions about the lack of a competitive bidding process in the district, county questions also seem to focus on building San Simeon at its water treatment plant at Hearst Ranch without an easement.
The county’s six-page information query highlights three state grants for Integrated Regional Water Management for $ 362,431, $ 177,750 and $ 500,000. One of which was awarded based on the status of the disadvantaged community in San Simeon.
Questions and requests for SLO County documents include:
- A copy of SSCSD’s current procurement policy and the policy in effect at the time he hired Phoenix Civil Engineering to carry out work on the Wellhead Treatment Project
- A survey showing the location of the Wellhead Treatment Project
- Information on when any member of the SSCSD Council or SSCSD team became aware of the Wellhead Treatment Project or any part of it being built on land not belonging to the SSCSD in fee, such fact or possibility and whether and when the SSCSD provided a notification to the district or DWR
- Documentation of the process by which the SSCSD selected Phoenix Civil Engineering to carry out the work on the Reservoir Expansion Project.
- The Land Use License and the San Luis Obispo County Classification License
- A detailed written response supported by a legal review of the applicable statutes, including, but not limited to, Section 4529.12 of the Government Code, and must be accompanied by any information the SSCSD has in support of your response.
- A detailed written response if the Wellhead Treatment Project has met the standard condition for Proposal 84 Financing Agreement and Proposal 84 Grant Agreement and if the Wellhead Treatment Project has been built entirely on the San property Simeon CSD, as set out in the Financing Agreement and the grant agreement.
San Simeon CSD officials have until January 20, 2021 to respond to the county’s request for information.