Challengers Crowd Race in Water District Hit by Scandal

In a referendum on the leadership of the Santa Margarita Water District and its culpability in an embarrassing scandal, a record number of reform-minded candidates are looking to take over four seats on a board whose membership has been unchallenged since 1987.

It has long been a struggle to get anyone to run for a board that deals in arcane topics such as transmission lines, ground water and improvement districts. In 1991, a candidate was elected, decided not to serve, and a former board member was begged to rejoin.

But now, for the first time in six years, voters have a choice of eight challengers hoping to crack the whip at the 29-year-old district.

Tuesday’s ballot includes a UC Irvine professor, a certified public accountant, a financial clerk, a marketing business manager, an environmental engineer, a marketing consultant, a homeowners’ association president and a business representative for a roofers’ union.

The sudden interest grew out of disclosures that the district’s top managers engaged in questionable spending practices. The managers, Walter W. (Bill) Knitz and Michael P. Lord, also received thousands of dollars in gifts from companies that they recommended for millions of dollars’ worth of contracts. Both retired in May after long careers with the district.

The FBI and the county district attorney’s office have been investigating the district for the past seven months. The U.S. Securities and Exchange Commission also is looking at the district’s banking and financial transactions.

The investigations are continuing and are not expected to be completed until the end of the year.

Those on the five-member board when the scandal broke said they were unaware of the excessive spending and gift-taking and have approved new policies designed to prevent the problems from recurring.

“Some people had some power and got a little carried away with it,” said Jim Neidert, who joined the board last year. “The controls weren’t in place and weren’t checked. But things have changed. I think all this shook up the board.”

Besides Neidert, the incumbents are Richard F. Boultinghouse, William F. Krasho and Sean Barrett. Barrett was appointed by the other board members after the retirement of John Van Dam. His appointment came after the scandal involving Lord and Knitz had already come to light.

Boultinghouse, who owns property in the district but does not live there, announced that his property would be sold this month and he would be ineligible to serve. His name will still be on the ballot, however.

Board Chairman Don B. Schone is up for reelection next year.

Whoever wins will get a chance to choose the new general manager among 138 applicants. There’s a new administration building to plan and a $28-million budget to oversee. The district serves more than 84,000 people in the areas of Rancho Santa Margarita, Mission Viejo, Coto de Caza and unincorporated areas of the county.

The winners also might find their jobs short-lived. Legislation carried by state Assemblyman Mickey Conroy (R-Orange) and signed into law this month by the governor changes the voting procedures for the Santa Margarita Water District and the Los Alisos Water District--the last two “landowner” districts in the county--seats on both boards will be up for grabs again in 1994.

Under the new law, board members will be elected like other officials beginning next year. Rather than the present system which bases votes on assessed property value, the district will revert to a “one-man, one-vote” district.

Conroy has said he will try to influence the major landowners to cast their votes on Tuesday for an all-new board. The landowners say they will listen to Conroy’s pitch but make their own decisions.

Bill Wachal, a 52-year-old marketing manager, said he is confident that the landowners will help alter the present membership of the board.

“My guess is that they’ll have to,” Wachal said. “Public pressure dictates change. Had (the scandal) not come up, there probably wouldn’t be a change. But the landowners will be fair and equitable, I think.”

Those running know the job doesn’t mean much for their resumes.

“It’s hardly a political steppingstone,” said Bob Lay, a 38-year-old banker who is being endorsed by Conroy and other political leaders. “But we have to restore a perception that the district has integrity and is being well-run. I think it’s safe to say that the best interests of the district have not been served.”

Besides Lay and Wachal, the others running are Brent R. Beasley, Richard William Hintz, Jim Holmes, Betty K. Olson, Roger A. Johnson and Jim Mizell.

Incumbent William F. Krasho said he relied too much on Knitz and Lord without asking enough questions, but has since learned his lessons.

“When (the scandal) first hit, I was very hurt, disappointed and ready to quit,” he said. “It was like finding someone in bed with your wife. If someone thinks I’m part of the scandal, fine. But I’ll stand on my record.”

At the Los Alisos Water District, two seats are open and three candidates are running. The Los Alisos district serves a population of 40,000 in the Lake Forest area.

The incumbent is Harry C. Johnson, a 64-year-old citrus and avocado grower who has been a district director since 1976. The challengers are Rod Jewell, a 37-year-old water supply engineer and Preston Bishop, a 59-year-old general manager of a Lake Forest homeowners association.

Water District Elections

The Santa Margarita and Los Alisos water districts will elect members to their boards in Tuesday elections. Here are the candidates for each:

SANTA MARGARITA WATER DISTRICT

Four contested seats

Incumbents

William F. Krasho

* Age: 51

* Occupation: Construction manager

* Residence: Rancho Santa Margarita

*

Jim Neidert

* Age: 47

* Occupation: Sales manager

* Residence: Rancho Santa Margarita

*

Richard F. Boultinghouse

Note: Resigned from the board Friday and is not eligible for the race. His name will appear on the ballot, however.

*

Sean Barrett

* Age: 50

* Occupation: Banking

* Residence: Lives in Rancho Santa Margarita

*

Challengers

*

Brent R. Beasley

* Age: 32

* Occupation: Business representative

* Residence: Rancho Santa Margarita

*

Richard William Hintz

* Age: 40

* Occupation: Financial clerk

* Residence: Trabuco Canyon

*

Bob Lay

* Age: 38

* Occupation: Banker

* Residence: Mission Viejo

*

Jim Mizell

* Age: 45

* Occupation: Certified public accountant

* Residence: Mission Viejo

*

Jim Holmes

* Age: 69

* Occupation: Retired manufacturing executive

* Residence: Mission Viejo

*

Betty K. Olson

* Age: 46

* Occupation: Water scientist-engineer and professor, UC Irvine

* Residence: Trabuco Canyon

*

Bill Wachal

* Age: 52

* Occupation: Marketing business manager

* Residence: Mission Viejo

*

Roger A. Johnson

* Age: 40

* Occupation: Environmental engineer

* Residence: Rancho Santa Margarita *

LOS ALISOS WATER DISTRICT Two contested seats Incumbent

Harry C. Johnson

* Age: 64

* Occupation: Citrus and avocado grower

* Residence: Newport Beach but owns property in the district

*

Challengers

Rod Jewell

* Age: 37

* Occupation: Water supply engineer

* Residence: Lake Forest

*

Preston Bishop

* Age: 59

* Occupation: General manager, Lake Forest Homeowners Assn.

* Residence: Lake Forest

Los Angeles Times