Oh, Wait A Minute. Now Things Are Really Getting Confusing Here. Open Letters? I Think What We Need Here Is Some Open Questions & Answers?
So, after posting the previous posting, (again, fair warning, this is for hard core Sewerites only) I got an email from CSD Board President Lisa Schicker that said:
“What I forgot to say in the letter [the previous posting] but you can put in your blog if you want, is Richard LeGros signed the checks to contractors, paying them out of SRF [State Revolving Funds] that were not designated for them – the SRF accepts invoices in arrears[?], thus:  First disbursement was CSD reimbursement of bond money spent on planning and design – it was to be used for this repayment.  Contractors could not legally start billing until one month after notice to proceed – i.e. NTP was August 22, their first bill was for Sept 22, then should not have been paid until Oct 22  Bruce [Buehl, former general manager], Richard signing checks paid MM [Montgomery Mechanical] and Barnard [construction companies] as soon as they got the first check – with not having sent any invoices up to the state as required. They also violated board policy and resolution on first disbursement (which was designated to replenish CSD funds for planning and design) – can be found in July 2005 minutes. This is all documented.”
Uh, O.K. Then this was followed by an email from CSD Boardmember Tacker who forwarded an email she received from Richard LeGros (in response to an email she sent to him about his last “open letter to the CSD” he had sent. Ah, so many open letters whizzing back and forth). In her email to me, Ms. Tacker stated, “The last cashflow analysis I saw before the [recall] election, the wastewater project had right around $100,000 left in it, the old Board was readying to borrow the MTBE money at that time to start the project without the SRF drawdown.”
In his letter to Tacker, Mr. LeGros concluded, “. . . . I claim sooner for if the WWP had not commenced, the LOCSD would not have received the $6.4 million SRF draw nor would you or the new BOD had the 3.9 million in SRF money to use when you and the BOD took control. In short, the LOCSD would have been facing bankruptcy much earlier (around March.) . . . “
Okey-dokey. So, was the pre-recall CSD already dangerously in the red? Were they robbing Peter to cover Paul, so to speak? Or more aptly, juggling accounts while eyeballing the old calendar and the clock was running out? To my knowledge, at that time, the Financial (and other) advisory Committees had been shut down so who was doing the usual advisory committee oversight? Was the rush to get the SRF first draw in hand motivated by a need to plug some looming financial holes that would have opened up had the board voted to delay actual start of the Tri W until the recall election was over? Were there budgetary problems or shortfalls that would have come to light without the first SRF draw? Why would Mr. LeGros think the CSD would have gone kaput in March, if the (old) CSD’s financial house was well in hand and all was in order?
The last auditor’s report noted that there were problems with the way the CSD had originally set up their system, and GM Bleskey has reported that they NOW have put into place a better system of checks and balances, but these emails raise questions that I hope get answered somewhere down the line: What financial shape was the CSD in before the recall and before the very first SRF draw arrived? If the date December 2005 mentioned as the date by which the project could have been delayed without jeopardizing the SRF loan is correct, what was the rush to get funds disbursed to MM & Barnard, payments that appear to have violated normal procedures?
Well, so many questions. Perhaps someone adept at running numbers will send the media another Open Letter, so we’ll learn just what was going on in the Last Days of Pompeii. . . er . . Los Osos. Stay tuned. Varooom, varoom.