Wu: Sanitary district case built on old grudges

Newport Beach-centric issues are in my wheelhouse.

The $150-million symbol of government decadence (new Civic Center), the $2-million Bridge to Nowhere, or the Newport Beach City Council. If you ask me any of those issues, I'll have an opinion.

But if you asked me about something Costa Mesa-related? I wouldn't be too comfortable with it. I'd research it, but ultimately wouldn't feel comfortable enough to write coherently.

However, something kept getting under my skin, so I started researching and making calls. And it turns out that government insanity exists in more than the Costa Mesa City Council.

But in this particular case, it exists in one of Orange County's special little districts, the Costa Mesa Sanitary District, where grudge politics have already cost the 116,700 residents of Costa Mesa, Newport Beach and sections of unincorporated Orange County tens of thousands of taxpayer dollars.

The issue has the potential to cost another $50,000 to $100,000 of taxpayers' money, involve the state attorney general and potentially end with an Orange County Superior Court judge removing a duly elected director of the Sanitary District.

But first let's back up.

Since 1944, according to General Manager Scott Carroll, the Sanitary District has never gone out to bid for its trash collection services. They've repeatedly signed contracts with the same company, albeit with different names, due to ownership changes, over and over for the past 68 years.

The district's current, 10-year contract with CR&R was signed in 2006, but with a six-year evergreen clause, essentially a six-year notice to CR&R if the district ever wants to go out to bid.

In 2010, Carroll gave notice to the district's board of directors that he wanted to invoke the six-year evergreen notice to CR&R to go out to bid for trash hauling in 2016, but the board unanimously declined to do so.

In late 2010, Jim Fitzpatrick was elected to the Sanitary Board and starts asking the same questions and also wants to invoke the six-year evergreen notice. And that's where the problems started.

Long story short, the other four directors want Fitzpatrick removed because they say his appointed seat on the Costa Mesa Planning Commission is in direct conflict with his elected seat on the Sanitary District board.

But Fitzpatrick says they want him out because of personality conflicts stemming from his tough lines of questions.

Who's right?

Well, when Fitzpatrick was elected to the board, their legal counsel, who has not changed or been out to bid since 1995, gave the board his legal opinion that there's a "good chance" that Fitzpatrick's appointed commission seat could be "incompatible" with his elected seat.

But the board did nothing about it, and business went on as usual, after all, Costa Mesa City Councilman Gary Monahan was also on the Sanitary board at the same time, so why couldn't a planning commissioner be on both simultaneously as well?

All the while, Fitzpatrick kept grinding away at the other directors: Why won't they go out to bid for trash hauling? Why won't they go out to bid for legal services, etc.? After all, going out to bid ensures that the taxpayers will get the best deal, right?

This grinding came to a head in the fall of 2011 when, according to Sanitary Board President Bob Ooten, "Fitzpatrick announced that he was going to get two more people elected in 2012 [to replace Director Art Perry and Director Jim Ferryman]" and "that's why the legal action started."

At Perry's insistence, the board hired another law firm, Meyers Nave, to provide a second opinion, not caring "what it costs," according to the agency's November minutes, with Meyers Nave providing the same opinion in February 2012 as the board received in late 2010.

But this time they decided to pursue the issue to forcibly remove Fitzpatrick.

While Ooten has requested that the directors contribute to the legal bills for this internal conflict, the rest of the board refused to contribute to the subsequent legal action, letting the taxpayers pay.

So now the board is embroiled in this internal lawsuit, using taxpayers' dollars in a race to kick Fitzpatrick out before he can get Perry and Ferryman voted out.

But what would you do, where would you have been if you were on this board? Would you be on the side of keeping status quo and not going out to bid for trash hauling since 1944, or would you be on the side of trying to save taxpayers' dollars by going out to bid at least every once decade or so?

The board is unwilling to try to save the taxpayers' money by going out to bid, but have no problem spending it because of personal grudges.

I think they'd be trying to kick me out too.

It seems to me that the only losers in this case will be the Costa Mesa and Newport Beach taxpayers.

JACK WU is an accountant who lives in Newport Beach and practices in Costa Mesa. He is a longtime Republican Party loyalist and a volunteer campaign treasurer for Rep. Dana Rohrabacher (R-Costa Mesa). His column runs Sundays on the Daily Pilot Forum page. He can be reached at jack@wubell.com.

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