Carwashes, Wax Jobs Cost O.C. Water District $8,460

Over a two-year period, customers of the Santa Margarita Water District were charged $8,460 so five top executives could have their cars hand-washed and waxed in the district office parking lot.

The wash jobs cost from $15 to $20 each, and the bills for waxing ranged from $50 to $75 each. Records show that some of the executives got their cars cleaned as often as three times a week.

The work was performed by James E. (Jed) Gilleran, whose father is president of the Mission Viejo Co., a development firm that casts one of the largest blocks of votes during water district board elections.

The district had an open purchase order with Gilleran from 1989 to 1991. Two of the five executives who regularly used his service are the district’s now-suspended general manager and his deputy, both under investigation by the FBI and the Orange County district attorney’s office for allegedly recommending that contracts be awarded to companies that gave them gifts in excess of state law.

Water district spokesman Scott Hart said Friday that the board of directors was never told about the carwashes and members were “absolutely surprised” when they learned of them upon being contacted by The Times. “They are amazed,” Hart said.

Board Chairman Don B. Schone said he intends to look into the carwashes, but noted that Gilleran’s service might have saved the district money because staff members didn’t have to take time away from their schedules to drive to a regular carwash.

“At first blush . . . I have concerns, but I’d have to have more information before I could judge it,” Schone said.

Some of Santa Margarita’s employees said recently, however, that they had complained about the arrangement to Gilleran, noting that a nearby carwash wouldn’t have cost nearly as much.

They point out that the district issues Chevron credit cards to Santa Margarita executives and that a Chevron station about three miles from the district’s office charges $6.95 for a carwash and $29.95 for waxing by hand.

Neither Jed Gilleran nor his father, James G. Gilleran, returned calls seeking comment this week.

Water district General Manager Walter W. (Bill) Knitz, on administrative leave pending the outcomes of the investigations, had his district-issued Mercury Colony Park station wagon washed four times in two weeks in late October and early November, 1989.

Michael P. Lord, the district’s suspended assistant general manager, had his district-issued 1989 Ford Bronco hosed down and polished frequently. Records show that in early 1989 his car was washed on Dec. 1, Dec. 5 and Dec. 8. The three carwashes cost $20 each. The same vehicle was waxed twice within one month in 1990 for a total cost of $120, according to Gilleran’s receipts.

Knitz and Lord have strongly denied that any of their dealings at the water district have been improper. In addition to the joint FBI and district attorney’s investigation into gifts from contractors, the managers are also under scrutiny for charging the district over the last several years for meals and travel expenses that include four-figure hotel room service tabs, cross-country trips for their spouses and $200 lunch bills.

Knitz and Lord, however, were not the only ones who billed water ratepayers for wash or wax services by Gilleran’s business, European Auto Detailing. Finance Director James W. Clark, former Operations Manager C.J. DiPietro and Chief Engineer William Dye also had their district-issued cars hand-washed.

Records show that Lord incurred the biggest carwash bill in fiscal 1990: $1,070. Clark was second, with $950 in charges, followed by DiPietro, Knitz and Dye. The total bill for 1990 came to $5,040.

Receipts for the following year could not be located this week by district officials, but other accounting records show that the agency paid Gilleran’s firm $3,255. Clark said the district is still searching for the receipts from that year.

Only $165 was spent on Gilleran in 1991, and the contract was then canceled.

“Given the economic times, it was felt that it was inappropriate to continue with this service,” Clark said. He said hiring Gilleran’s company was Lord’s idea.

On Thursday, Lord’s private attorney, Gary M. Pohlson, said he saw nothing wrong with the arrangement and noted that all the executives’ cars belonged to the district.

Lord’s weekly $20 carwash fee is “pretty standard,” Pohlson said. “It is exactly what I pay. Somebody comes to our office and does it for $20.”

Knitz’s attorney, Marshall M. Schulman, also defended the carwashes.

“I don’t take my car to a carwash,” said Schulman. “The quickest way to have the front end out of alignment is to take it to a carwash. The water is harder, too.”

Schulman criticized The Times for asking questions about the carwashing and waxing bills.

“It sounds like a penny-ante investigation to me,” the attorney said. “If that’s the best you can up with, I really don’t have a comment to make at this time.”

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