Your water bill includes a museum
The Metropolitan Water District has spent $16 million in ratepayer money to finance an unusual museum that officials hope will tell “the story of water” in Southern California.
But today, months before its grand opening on a remote plain in Riverside County, the water museum is drowning in multimillion-dollar debt.
For the record:
12:00 AM, Feb. 16, 2007 For The Record
Los Angeles Times Friday February 16, 2007 Home Edition Main News Part A Page 2 National Desk 1 inches; 50 words Type of Material: Correction
Metropolitan Water District: An article in Wednesday’s California section about the Metropolitan Water District’s decision to pay the debts of a nonprofit water museum it helped finance in Hemet said the board had 42 members. It has 37. The same error also appeared in a related article on Jan. 27.
Next month, the MWD board will be asked to spend $4 million or more to save the Center for Water Education from bankruptcy. Several contractors who have worked on the project, near the Diamond Valley Reservoir in Hemet, have filed liens saying they haven’t been paid.
The financial crisis has some board members and community activists questioning the wisdom of building a museum in the first place, when the MWD’s main purpose for existing is providing water to 18 million residents in six counties from Ventura to San Diego.
“We think this is horrible public policy,” said Jon Coupal, president of the Howard Jarvis Taxpayer Assn. “I think most taxpayers would be deeply offended to see their money going toward a water museum.”
The center, officials say, is part museum, part educational facility with exhibits detailing water’s historical and everyday significance in nearly all aspects of life. Its website -- www.centerforwater.org -- boasts that MWD directors “made a commitment to future generations that the story of water in California and the value of water to human kind would be told. No where else is this story available in a comprehensive enriching environment.”
The center hopes to lure students, families and businesses to its sprawling campus. The grand opening had been scheduled for summer, but in November some members of the public were admitted during a “soft opening.” Currently, the facility is closed as work continues on exhibits.
Supporters defend the venture, saying that public education about water management and conservation is a key part of MWD’s mission.
Coupal said that mission’s price tag is too high.
“If they really want to inform the public on conservation, they could include an insert with your bill,” he said.
The main force behind the project is MWD Director Phillip J. Pace, who spearheaded the initiative when he was district chairman in 2001. With the MWD’s financial backing, Pace established a nonprofit organization and made it responsible for constructing, maintaining and operating the 23,000-square-foot facility.
Even before the debt became a problem, there were concerns about the way the project was being managed. State auditors in 2004 criticized the center for failing to have formal policies and procedures for awarding lucrative consulting contracts.
A year later, Pace’s role as a water district director and chairman of the museum’s board prompted a conflict of interest investigation by the Los Angeles County district attorney’s office. But the probe was closed after investigators concluded that Pace received no financial benefit from the arrangement.
Pace, president of Pace Land & Development and a former Montebello city treasurer, declined to discuss the center’s financial woes. But in a letter to the water district board this week, he blamed the museum’s mounting debt on unexpected cost increases in construction materials. He said private fundraising efforts also have fallen short.
“As of today, the center can only move forward with the immediate financial assistance and support of Metropolitan,” Pace wrote. “The center has run out of financial options.”
Pace has asked for a $4-million loan to cover the center’s bills and an additional $2 million for “operation subsides for the first three years.”
Construction at the center, he said, is nearly complete.
At a meeting Tuesday, an MWD “working group” assigned to find a solution to the financial problem recommended that the water district pay the center’s outstanding debts, terminate its ground lease and take control of the facility from the nonprofit organization.
The group also recommended that the MWD partner with another entity to develop “a self-sustaining center that does not place extensive financial burdens on Metropolitan and its ratepayers.”
The MWD’s 42-member board of directors is expected to vote on the matter Feb. 13.
Vice Chairman Marcie Edwards, a member of the working group and a representative of the Anaheim area, said the future of the center is very much up in the air. She said the recommendation was aimed at protecting Metropolitan’s investment and was not a reflection on the broader public policy debate of allocating ratepayer money to an educational facility.
She said her fellow board members have varying opinions about the merits of such a project.
Director James H. Bond of Encinitas voiced concern about the MWD’s growing financial commitment to the center.
He said he wanted to “put a brake on the cash drain” it was causing. Director Gene Koopman of Ontario was also concerned with what he viewed as a financial “bailout” using public funds.
In a statement Friday, Pace defended the project.
“I am proud of what the Center for Water Education has accomplished since its inception,” he said. “I steadfastly believe the center offers both tangible and intangible benefits to the Metropolitan Water District of Southern California and its member agencies.”