Grand jury: Lompico County Water District should merge with SLV

In a penetrating report following an eight-month investigation, the Santa Cruz County Grand Jury recommends that the Lompico County Water District continue to evaluate and, if appropriate, pursue a merger with the San Lorenzo Valley Water District.
The grand jury, a citizens group commissioned by Santa Cruz County, studied the district and documented a series of continuing problems — financial, managerial and structural — that plague its operations.
“I think the report is quite accurate,” LCWD board president Lois Henry said. “I think the current board has been trying, but I can’t really argue with what it says.”
The grand jury recognized that people in the canyon are passionate about their independent water district, but it deemed the ongoing crisis too overwhelming for the district to handle by itself, hence the recommendation for a merger with SLV Water District.
“The handling of the district’s financial resources by the boards of directors and management staff has left LCWD on the verge of bankruptcy,” the report states.
Lompico has inquired about a merger with SLVWD, and the larger district recently put together a report for its board of directors detailing the Lompico system and its 500 connections.
The grand jury found many deficiencies in Lompico, including the following problems:
• Three redwood water storage tanks (two 100,000-gallon tanks and a 60,000-gallon tanks) leak and need to be replaced. Plastic pipes that connect water mains to homes are breaking and should be replaced with copper pipes. About 40 percent of the pipes have already been replaced. There is no plan or money to replace the rest.
• LCWD has operated at a deficit for at least five years. The district struggles to pay its operating costs, and there is no capital improvement plan or reserve fund to pay for upgrades.
• Payroll records have been kept inaccurately.
• Of an annual budget of about $400,000, the district spent about $300,000 on personnel costs for three employees before the general manager and district secretary were fired. The remaining $100,000 was left to run the district, which proved to be insufficient.
• The district does not have the money it would need to apply for grants or loans.
• Board members often are not sufficiently educated about district policy and have failed to monitor the financial practices of the district.
• The board did not set sufficient rates and charges to operate the district.
• Agendas and meeting minutes are incomplete, and there is a lack of reliable records. Over the years, boards have passed policies that have been ignored by the next board.
• Leaky tanks have caused low water pressure. Repairs have also caused low water pressure, and the Zayante Fire District is not always notified when there is less water to fire hydrants, which may put residents at risk.
• The report commended the present board of directors for recognizing the district’s problems and beginning to address them.
The complete report will be available later this month at the grand jury website, www.co.santa-cruz.ca.us/grandjury, and at public libraries.