Advertisement
YOU ARE HERE: LAT HomeCollections

California and the West

Watchdog Calls Special Districts Lax

Government: Little Hoover Commission says state's panels that handle water, trash and other services have $19.4 billion in reserves, but scant oversight of how money is spent.

May 04, 2000|ERIC BAILEY | TIMES STAFF WRITER

SACRAMENTO — California's anonymous collection of small special districts handling water, trash, flood protection and other services are sitting on $19.4 billion in reserves with little oversight for how that stash is used, a state watchdog agency reported Wednesday.

The Little Hoover Commission recommended that state legislators take steps to promote better public participation and oversight of the more than 2,200 independent special districts scattered throughout California and improve management of their rich pool of reserve revenue.

In an 80-page report, the commission said many local and state lawmakers are unaware of the vast size of those reserves, putting leaders at risk of making faulty judgments in planning for California's future. Officials at some districts, the report said, couldn't even articulate a plan for how reserve cash should be spent.

"Many districts operate without much scrutiny," said Richard R. Terzian, the commission chairman. "Some of them should probably be merged . . . and some of them should probably go away."

Some officials at special districts immediately attacked the report as an overly simplistic study that missed the mark. The lack of public participation, they said, is a sign of customer satisfaction.

"As long as water comes out of the tap and toilets work, the public doesn't get too excited about special districts," said Bob Reeb, state legislative director for the Assn. of California Water Agencies. "We can't make people come to meetings."

California's independent special districts handle a broad range of duties, from running public cemeteries to operating parks and sewer systems. There are special districts for street lights, hospitals and libraries. The more than 450 districts that provide water form the biggest contingent. Many were formed years ago to extend services to rural spots unserved by cities.

But growth has caught up. Some legislative leaders contend that many special districts have outlived their useful years and should be consolidated or dissolved. The commission report cited how a third of the state's 74 hospital districts no longer operate hospitals, instead administering separate health services such as ambulance service or clinics.

With little scrutiny by the public or press, scandals have engulfed some special districts.

The latest under the microscope is the Water Replenishment District of Southern California, the subject of a critical state audit in December that cited shoddy planning and management. Several of the cities serviced by the district in south Los Angeles County have filed lawsuits and are trying break away, angered by high prices for water. Assembly members Sally M. Havice (D-Cerritos) and Thomas M. Calderon (D-Montebello) are pushing bills to revamp the water agency.

In its report, the Little Hoover Commission also recommended that lawmakers strengthen efforts by Local Agency Formation Commissions to scrutinize special districts, which can have overlapping or outdated duties that make them targets for consolidation or elimination.

The commission suggested that most county LAFCOs are understaffed, underfunded and lacking the independence needed to challenge the status quo at special districts, which invariably don't want to shut down on their own.

Some of the reluctance, the report said, is driven by the compensation offered elected board members at districts. Although the typical stipend and benefit packages are minimal, elected directors at some districts receive compensation of more than $20,000 a year, sometimes for attending a few meetings a month.

Legislative attempts in Sacramento to force consolidations have been unsuccessful. A bill to meld 25 water agencies in Orange County failed in the mid-1990s. Later, the county's LAFCO pushed for consolidation of three water districts, but the effort took several years.

The 12-member Little Hoover Commission, which is appointed by the governor and legislative leaders, chided districts for holding unreasonably large reserves at a time that the state asked voters on two occasions to approve nearly $3 billion in water bonds.

"Neither measure was crafted to consider the resources already available to water districts," the report said.

The panel's report noted that the giant Metropolitan Water District of Southern California reported reserves of more than $4 billion in 1999, five times its annual operating revenues. The Irvine Ranch Water District's reserves amounted to more than three times its annual revenues, according to the report.

The commission recommended that districts do a better job of publicly reporting their reserves and suggested a panel be appointed by the Legislature to set guidelines for prudent levels of savings, which go to fund public works projects and finance emergency work.

Advertisement
Los Angeles Times Articles
|
|
|