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Directors' Don't Scrimp on Tabs Either


MISSION VIEJO — Some of the elected directors who voted unanimously Friday to suspend two Santa Margarita Water District managers have incurred a few interesting business expenses of their own, a review of water district records shows.

Over the past two years, for example, board chairman Don B. Schone has twice charged district ratepayers for the $275 in expenses he incurred while taking part in the El Viaje de Portola, a horseback ride that attracts hundreds of South County business and political figures.

District officials also say that several expensive parties have been hosted by the board as a whole and charged to ratepayers.

Several board members interviewed Friday said they saw nothing wrong with their own expenses, which generally run far lower than those incurred by now-suspended managers Walter W. (Bill) Knitz and his assistant, Michael P. Lord.

Prominent Orange County political reform activist Shirley L. Grindle was critical nevertheless.

"The reason that (Knitz and Lord) are not fired by now is that some of the board members are doing the same thing," Grindle said. "What does that say about what the board is doing?"

The annual Portola ride joined by Chairman Schone traces the route of Don Gaspar de Portola, the Spanish explorer who blazed a trail through Orange County and California in 1769.

Last year, Schone accounted for the Portola event as "district director interface activity with customer/business entities," records show. In 1991, Schone simply noted it as a "business meeting expense."

When asked on Friday how Schone's horseback rides relate to official business, district spokesman David Ellis said, "I am going to pass on this" and referred a reporter directly to Schone.

Schone said the Portola expenses were justified because he was representing the district at the time. "I felt I paid for it the right way," he said.

Schone said his horseback rides were approved by Knitz, the district's general manager who along with his deputy was placed on paid leave Friday pending the outcome of an Orange County district attorney's investigation and FBI inquiry.

Managers Knitz and Lord have come under scrutiny in recent weeks since The Times disclosed that the two managers had charged ratepayers for tens of thousands of dollars in expenses in recent years, from four-figure room-service tabs to sheepskin seat covers for their cars.

District officials say it was Knitz who normally approved Schone's expense reimbursement requests, while Schone in turn approved Knitz's.

Schone said the controversy involving Knitz and Lord has now led to some "soul-searching" on his part, and he has questioned his own involvement in approving Knitz's expenses.

"I look back and say, 'Gee, maybe I should have questioned this or that instead of spot-checking his expenses,' " Schone said. "If I had thought (Knitz) was a marginal employee, maybe I would have looked closer. But when you have confidence in someone and you are signing things in a hurry after a board meeting, you don't really look that closely.

"I should have said, 'Let's call a meeting and look at this and that,' but we were too busy building water and sewage treatment plants."

Records also show that Schone, a quality assurance manager for Southern California Edison Co., charged $1,302.62 in room service at a 1992 conference of the Assn. of California Water Agencies. Schone--who rented two separate rooms--explained that the district was hosting consultants and the charges were made to his room.

The Santa Margarita district has also held a number of expensive parties with board approval, according to Knitz and Lord. One party for a retiring board member that was held at Cannons restaurant in Dana Point cost $2,233.47.

"Do you have a problem throwing a retirement party for a board member? Because I personally don't," said board Vice Chairman Richard Boultinghouse, a Costa Mesa furniture store owner who has been a director since 1980.

An anniversary party held for Knitz two years ago cost the district $1,783.

"It was a surprise party," Knitz said in an interview last month. "I didn't know anything about it."

Lord said he and Schone organized that event at the request of the full board.

Knitz's expense accounts also indicate that Schone, Boultinghouse and board attorney Fritz Stradling have frequently eaten lunch at an expensive French restaurant, La Ferme, in Mission Viejo just before board meetings.

The tab for five of those get-togethers last year alone came to $670.

Knitz said last month that he didn't think it would be appropriate to eat somewhere less expensive. The restaurant in question is "a place that's conducive to doing business," Knitz said.

Schone on Friday described the expensive meals as "business working lunches."

"We're going over district business," he said. "Do you want us to have a consultant pay for it?"

Boultinghouse said he saw nothing wrong with the lunches either.

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