Investigation of Officials at Castaic Water Agency Sought : Complaint: Two critics of the organization ask the state to probe whether ties to a developer posed a conflict of interest. District authorities have denied wrongdoing.

Two elected officials asked California’s political watchdog agency Monday to investigate whether top officials of the Castaic Lake Water Agency violated the state’s conflict-of-interest law by using their positions to help the area’s largest developer.

The complaint filed with the state’s Fair Political Practices Commission followed a report in The Times on Monday that four top water agency officials had shaped millions of dollars in agency projects affecting Newhall Land & Farming Co. while having financial ties to the firm.

“I personally think it’s pretty outrageous that people take a public job to look out for the public interest and then it turns out like this,” said Ed Dunn, who filed the complaint along with Lynne Plambeck, another water agency critic. Both are elected board members of the Newhall County Water District.

During the past three years, records show, the Castaic water agency has graded a road that the agency said was worth $3 million through Newhall Land property, planned a $4.2-million reclaimed-water system to serve Newhall Land developments, and relocated a major waterline that ran in part under a Newhall Land site.

During that period, water agency General Manager Robert Sagehorn oversaw all three projects while holding an investment interest in Newhall Land. And water agency board members Richard Green and Robert DiPrimio, and past board member Stephen McLean, dealt with some of those projects while also having financial ties to the company.

FPPC spokesman Gary Huckaby said, under his agency’s policy, he could not confirm that the complaint had been received or make any comment on the issues involved. However, Dunn and Plambeck provided a copy of the complaint that they said they faxed to the commission Monday.

Meanwhile, neither Sagehorn nor Robert Clark, the Castaic water agency’s attorney, returned phone calls Monday. Previously, they had denied any wrongdoing by agency officials in pursuing the projects affecting Newhall Land, which also is the largest property owner in the water agency’s area.

Under state law, public officials are not supposed to make, participate in making, or use their official position to influence governmental decisions in which they have financial interests. The FPPC can levy fines of up to $2,000 for each conflict-of-interest violation.

Sagehorn, who earns a $113,300 salary from the water agency, acknowledged that he owns 300 limited-partnership shares in Newhall Land worth about $3,900. McLean, who left the agency’s board last year to become a top Castaic water staff member, said he owns 200 shares in the company, worth about $2,600.

Green, a nursery store owner, said he bought his business property from Newhall Land several years ago and still owes the company about $140,000. And DiPrimio is the managing director of the Valencia Water Co., a wholly owned subsidiary of Newhall Land.

According to agency records, McLean voted twice for the road grading project in 1992, and for a $576,610 contract the agency awarded in 1993 to remove a major waterline that ran in part under a three-acre Newhall Land commercial site the company began to develop shortly thereafter.

Records show Green and DiPrimio also voted in 1993 for the pipeline relocation contract. And then last month, both attended a Castaic agency board meeting during which Sagehorn presented the new design for the reclaimed-water system that initially would serve only Newhall Land projects.

Although the board did not take a formal vote that day, water agency staff members said they wanted board members to review the design before they proceeded to seek loan funding for the project. The project would use recycled water to supplement existing supplies.