Water Agency Seeks Legislation to Broaden Power : Castaic Board Would Be Allowed to Levy Fees, Add Non-Elected Members

The Castaic Lake Water Agency, an obscure public body that provides water to the booming Santa Clarita Valley, is seeking legislation to broaden its authority to buy surplus state water, levy water-connection fees and add non-elected officials from two public and two private water companies to its seven-member elected board.

On the surface, the bill, written by Assemblywoman Cathie Wright (R-Simi Valley), has been non-controversial. The Assembly on June 11 approved the proposal 77-0 and sent it to the Senate, where the Agriculture and Water Committee is scheduled to hold a hearing on it today.

But amendments made to the bill late last week have prompted Agriculture Committee consultant Stephen Macola to urge committee members to debate the bill “at great length.” The measure also has brought to light a simmering dispute among the seven members of the current water agency board over the future of water distribution in the communities of Newhall, Valencia, Saugus, Canyon Country and Val Verde.

Population May Reach 200,000

Supporters contend the measure is required to ensure that the area’s thirsty population--expected to double to 200,000 by the year 2010--receives enough water. Robert C. Sagehorn, the agency’s general manager, estimated that the change in law would help the agency raise at least $12 million.

“The bill will provide financial mechanisms to bring the required amounts of water into the area,” said Sagehorn, whose agency purchases Northern California water from the state water project and resells it to the area’s four water companies.

But, in an analysis of the bill made public last Friday, Macola declared: “The thrust of the bill seems to be to allow directors with substantial vested interests to make decisions enhancing those interests.”

Under the amended version of the measure, the non-elected members of the agency would be exempt from provisions of the state Political Reform Act and other provisions of state law dealing with the financial compatibility of elected or appointed officials.

Under state law, members of public boards generally cannot participate in decisions in which they have a financial stake. However, there is an exception when it is determined that a board member’s economic interests are indistinguishable from those of the public as a whole.

No Reform Act Violation

The Wright bill is supposedly designed to ensure that the interests of the appointed directors of the water agency would be the same as the public interest and, therefore, would not violate the state Political Reform Act.

One Senate aide familiar with the amendments but who asked not be identified said that the bill would allow the appointed board members to say, “I’m going to vote in my best financial interest.”

On Monday, Wright said she would consider restricting the exemption from the Political Reform Act but angrily denounced the committee analysis. “I’m a little upset at the way the consultant has put in his interpretation rather than analyzing the bill,” Wright said.

She said the exemption from the Political Reform Act was merely copied from another water agency. “I don’t know how widespread it is but it has been done before,” Wright said.

Didn’t Get Full Entitlement

The Legislature in 1962 established the agency to sell the four water companies Northern California water pumped into Castaic Lake under the state water plan. The water was needed to augment the diminishing ground-water supply, controlled by the water companies.

But, because the state water project was never finished, the agency never received its full entitlement and, in part, seeks passage of the legislation to buy additional water from San Joaquin Valley farmers.

A majority of the board members support the Wright bill. Supporters on the board say the four companies control all the ground water pumped in the Santa Clarita Valley and that, to ensure growth, all the area’s water agencies should be on a single board.

“If the water purveyors aren’t allowed to sit on that board they won’t give up their water rights,” said Wright.

Seats in Exchange for Fees

The two major water companies are the private Santa Clarita Water Agency and the Valencia Water Co., which receive most of the state water from the Castaic Lake Water Agency. Two public agencies --Los Angeles County Waterworks District No. 36 and the Newhall County Water District--also would gain seats on the board. They draw minimal amounts of state water.

Castaic manager Sagehorn said that, in exchange for agreeing to allow connection fees and other water charges, the water companies sought seats on the board.

Board President Mary Spring said that, if the water companies had to follow all the provisions of the Political Reform Act, “their hands would be pretty well tied as participants on the board.”

She also noted that the water companies are regulated by the state Public Utilities Commission, which bars them from earning “a profit off water they buy from us for resale to the public.”

Spring acknowledged that her board is badly split over the issue. The agency board agreed to push for the legislation in January on a 4-3 vote.

She blamed personality differences between some board members, whom she would not identify, and officials of the water companies as the root of the trouble.

“If it weren’t for the personality issue we would have the total support of the board members,” Spring contended.

Calls Bill a ‘Subterfuge’

Lorrin C. Peterson, a board member who opposes the legislation, said that he first sought an accommodation with the water companies. He said he wanted an agreement on an overall water-management plan for the area, including how much ground water should be pumped, and on a water conservation program.

Peterson termed the bill that emerged a “subterfuge” because the connection fees “won’t raise enough money to get a sniff of water . . . we’ll have to borrow money.”

Another board critic of the bill, H. G. Callowhill, said the board should not be in such a hurry to change its membership because “we have enough water to last us through 1992.”

Callowhill said he would support placing the issue on the ballot and allowing Santa Clarita Valley voters to decide. “I don’t think I have that right” to place private companies on the agency board, he said.

Callowhill also said he opposed the bill because he is against mixing public and private enterprises on a publicly elected agency.