Oh, That Champagne Water District! : Disturbing reports of high living by agency officials at a time of hardship for most

The Santa Margarita Water District in Orange County is one of many special districts in California that exist in a sort of twilight zone where public scrutiny is especially difficult. But it is the public’s business just the same.

The district provides water and sewer service for 84,000 customers in the South Orange County communities of Coto de Caza and Rancho Santa Margarita and a part of Mission Viejo. Everyone should have it so good as the district’s two top executives, General Manager Walter W. (Bill) Knitz and his assistant, Michael P. Lord, who over nine years ran up combined bills of more than $160,000 in fancy meals, pricey hotels, limos, first-class air fares and other perks.

The two also accepted more than $40,000 worth of gifts from contractors, bankers, developers and consultants. Lord says worry over whether the gifts to him were legal prompted him last year to reimburse his gift-givers to the tune of $11,100, though he offered no proof of having done so. But Lord and Knitz did not refrain from influencing decisions that may have benefited these companies--as state law requires if gifts total $250 or more a year.

The public agency’s board didn’t seem to mind what its managers were doing--until their expenses and gifts were about to be disclosed by The Times. Only then did board Chairman Don B. Schone comment, “Maybe we need to do some soul-searching.”

Amen. New policies on perquisites and strict new guidelines on the acceptance of gifts must be put in place immediately. And a promised investigation by the local district attorney will be welcome.


As outlined in articles by Times writers Gregory Crouch and Mark Platte, the water district has been operating on an anything-goes principle that arrogantly assumed that whatever was spent was justified. Asked to explain an airline ticket for Lord’s wife, for example, Knitz lamely said it was “just a perk.”

The same went for Knitz’s own 1990 limousine ride through Manhattan, taken because he was “just killing some time before my plane left and doing a little sightseeing.” The cost of the limo and a stop for lunch at the posh Tavern on the Green in Central Park: $366.70.

Santa Margarita is especially obscure because its board members are selected by landowners according to how much land they own; most other districts operate under a more democratic “one person-one vote” policy. Some fairer system would help bring this agency into this century.

The more important matter is the perception of agency managers feasting at the public trough. Orange County Auditor-Controller Steve E. Lewis had it right: “All of this stuff . . . reinforces the thought that we’re all a bunch of crooks.” What goes on in the murky Santa Margarita-villes of the world undermines public confidence in government.