Eye On Modesto

Thoughts and observations about Modesto and Stanislaus County

Archive for the tag “Mike Lynch”

MID.. Re-writing History While Neglecting the Future -The Tom Van Groningen Story

By Emerson Drake

Let us travel back in time for a moment and visit Feb. 23rd, 2010.  MID had just voted to purchase half of its originally

Cover of "Millions"

Cover of Millions

intended share (from 66 to 33 MW) of the Lodi Energy Center.  MID had been spending money like a drunken sailor on shore leave for years on projects costing ratepayers millions of dollars.  From the geo-thermal project, to Mountain House, to TANC, to the four cities project,  all were massive losers, millions upon millions of dollars going out with almost nothing coming back in.  In less than twelve years (1998 to 2010) we went from being $200 million in debt to $1.2 BILLION.  In January of 2010, they had voted in a 7% rate increase which doomed a larger piece of the action for MID.  I was at both of those votes and was happy with neither.

Many of us had been trying to stop the fiscal bleeding for years by going to meetings and speaking out, but Tom Van Groningen,  Paul Warda,  Cecil Hensley, and John Kidd were determined to follow Allen Short down the fiscal prim rose path.  During four of those years Mike Serpa was the only voice of reason on the Board. By 2010 being able to take full advantage the Lodi opportunity was little more than a pipe dream.

Jerry Gold, MID’s financial advisor, had previously reported MID’s credit had been down graded and no one was willing to allow us to borrow more money in our present (2009)  financial condition. By 2010 we were being required to raise rates by 7% just to stay afloat.

Even our newest green energy contracts are too expensive.  We overpaid by more than 30 percent of the going rate.  This isn’t hindsight speaking. PG&E announced their newest solar contract price PRIOR to MID signing the contract.  When I pointed this out to Tom Van Groningen during the meeting BEFORE the solar vote was taken and the contract was signed with Sun Power, he said he didn’t care what PG&E signed for.  What?  Don’t care?  I made public information requests during the negotiations but MID refused to acknowledge prices being discussed.  When you see how much was left on the table (30%) there should have been an investigation.

Just so everyone understands the Lodi Energy Center (LEC) is the most efficient gas turbine power plant in the state. Its average heat rate surpasses even Turlock’s new much smaller plant. We actually could and will make money by owning it but now only half as much.

To watch Director Van Groningen be self congratulatory and preen himself for signing the contract two years earlier for  the Lodi plant was astonishing.

It wasn’t surprising to see the Bee supporting the revised version of MID’s history.  Admittedly it was closer to reality than it would have been with John Holland.  Something else of note came out of the MID meeting.  I received a response to a Public Records Request prior to the meeting.

It was about the astonishing amounts of money Allen Short, Tom Van Groningen, and Glen Wild had been funneling through Martino Graphics to lobbyist Modesto Mike Lynch.  Mike, who provides Judy Sly many of  her “editorial positions” and who was even quoted in a recent column by Ms. Sly, was a participant in the $89,500 in 2010, $227,628.69 in 2011, and $108,000 in 2012 paid  to Martino Graphic design and distributed to three different lobbyists.  Just as in 2012 Mike Lynch profited the most from the parasitic relationship with MID and Martino  than Mike Looker, and Janice Keating.  Just a few short months ago Ms. Sly was telling us  we had plenty of “extra” water to sell to San Francisco?  Now, the tune being sung by the Bee is different.

It never fails to amaze me the amounts of ratepayer money being thrown around to convince us bad is good and good is bad.

It’s going to be interesting to see if any of the MID Board members have another prior  “relationship” with political campaign consultant Mike Lynch.

I wrote the following back in Feb. of 2010

MID Goes on a Spending Spree and Maxes Out its Credit

The MID Board today authorized Allen Short to buy into the soon to be built Lodi plant for a 30 MW (Mega Watt) share.

Interestingly enough this wasn’t one of the options presented to the board or to the public.  Tom Van Groningen made the motion and despite calls from several public speakers for more information the board voted 3-2 with Hensley and Kidd being the two dissenters.

It was noted that MID has refused to make cost cutting measures such as stopping the flood of Mountain House red ink.  A concern was noted that possibly the board is going to try to slash the IBEW (International Brotherhood of Electrical Workers contract offer while maintaining the extremely lucrative pay for executives.

The Lodi plant will utilize the most efficient turbines in Northern California and would seem to be a great opportunity if only we could afford it. The MID Board has spent us into $1.2 Billion dollars in debt.  I don’t think Tom Van Groningen will be forced to sell his private plane to pay for the increase in electric rates this purchase will mandate.

MID financial advisor Jerry Gold pointed out MID will exhaust it credit capability with this expenditure.  So like families who max out their credit cards and continue to only make minimum payments our road to solvency will be long, rocky and definitely on the back of the average electric user.

Of course we remember that the board is looking at surcharges in lieu of more rate increases this year with a caveat since staff members today said they will be looking at rate increase by next year at the latest..  I’m not sure that semantics (word games) make much difference to our check books or to our bottom line it sure seems to be the direction MID is determined to go in. Surcharges and rate increases will hurt families, farmers and businesses in District.

One concern that was made public during discussions while on a break at the meeting was a question regarding MID’s potential violations of the Brown Act.  Has Allen Short been meeting in series with the board members, and just what emails have been exchanged since that particular form of communications was mentioned by several of the board members?



Deceiving the Public MID Style

[CALIFORNIA-A-0023] Don Pedro Dam

[CALIFORNIA-A-0023] Don Pedro Dam (Photo credit: waterarchives)

By Emerson Drake

MID has come through some very turbulent times. They had an iron fisted General Manager in Allen Short and until last year MID’s Board of Directors was a rubber stamp for his misguided dictatorial policies. Unfortunately it is the public that has been required to foot the bill. Here is an example of what has gone on during the last year of Allen Short’s reign.

Some Background

Back in 2010 the Board allowed GM Short to create a policy know as  Resolution No. 2010-35. This resolution, when combined with Purchase Order 54981 to Martino Graphic Design (MGD) for a total of $450,000, effectively created a slush fund using Joy Warren as Regulatory Administrator for control.  The original purpose for this fund included concerns about regulation concerning the delta, greenhouse gas, state regulations, and a euphemistic “improve the image and credibility of the district.”

But through a series of phone calls leaving no paper trail, the Resolution was bastardized and at least $148,000 went, utilizing “creative descriptions,” to a series of players/vendors to be used to create a false image of the potential water sale to the general public.  It’s my opinion this was done by nefarious design to make tracking the money and proving where it went  difficult, if not almost impossible. At least one recipient of the slush fund (Janice Keating) spoke before the Board claiming to be a private citizen while others  recruited “politicos”, both politicians and wannabee’s to speak in favor the sale thus attempting to create a false impression using testimony for hire to fool the media and the unsuspecting public.

The Key to the Code

Throughout the year I submitted multiple formal Public Information Requests and queried the MID Board in a variety of ways during meetings, trying to get to the bottom of where the money was going .  But MID’s staff, management, and attorney, refused to provide any real answers other than the veiled documents themselves.  Finally on December 18, 2012 after a tumultuous MID Board meeting, Modesto Bee Reporter Garth Stapley was given the key to the code by a MID staff member to decipher the Martino Graphic design invoices. His story is here with the relevant information on page two.  http://www.modbee.com/2012/12/18/2500794_p2/raises-okd-for-modesto-irrigation.html 

Unfortunately, Garth only broke down the current invoice totalling $48,500, instead of the entire amount of $148,000 billed in 2012, despite being in possession of the earlier invoices MID already paid to MGD.  We know he had the earlier invoices because I sent them to both Garth Stapley and to Judy Sly many weeks earlier in an attempt to get them to write a story about what was going on.

Money was laundered using Martino Graphic Design as a middle man. The plan was designed to allow MID to make the claim, which they did, of having no contracts with those receiving the money and as such did not know where it was going.

Here is the Breakdown as we Know it Today

During the year 2012 under the guise labeled Outreach and Transparency, Janice Keating took $28,000.  Under Communications Services Mark Looker took $28,500 and under Consulting,  Mike Lynch took a whopping $52,500.   For their part in this ruse Martino Graphics Design pocketed $29,000.

In a recent Public Information Request response MID stated “NO money has been given to Janice Keating or Mike Lynch  for the last THREE years.”  The same PIR showed Carol Whiteside had only received $1,500 dollars to her or her company, California Strategy, in the last three years when the actual total to Ms. Whiteside  is almost $30,000.  In a follow-up conversation with Asst. General Manager Lou Hempel,  he stated “after checking I show no money other than the $1,500 to Carol Whiteside’s California Strategy’s has been paid to any of the three in the last six years.”

MID used ratepayer’s money deceptively to create a false impression in the public’s mind in order to sell water we don’t have in order to hide the financial mismanagement that has been going on for many years. It would be my suggestion this type of paid testimony has been going on for years. Unfortunately only an in-depth investigation by knowledgable persons would discover what has been occurring.  Several members of staff including Joy Warren, took an active role in this, what can be described at best as a legally questionable  tactic. No effort was made by staff including the General Manager to inform the Board members,  yet by their own admissions during public meetings, Directors Tom VanGroningen and Glen Wild were willing participants to the deception.

MGD did create a few flyers, stickers, and handouts but these were billed separately and at much smaller costs  to the same PO number. MID  Board Agenda Report from their December 18, 2012 meeting was filled with deception and what can only be described as political spin trying desperately to paint a false impression to anyone who hadn’t been following their exploits for the past year.

Did you know MID is still paying former General Manager Allen Short his regular pay through October of this year despite him having left back in December?   You do now.   Are you wondering why there was a $60,000  investigation conducted by the personnel department at the end of last year?  Maybe you should be.

Who’s Being Disingenuous at Modesto Irrigation District Meetings?

Modesto Marathon  7983

Modesto Marathon 7983 (Photo credit: RussellReno)

By Emerson Drake

Today’s MID meeting was an eye opener. Despite having discussed Martino Graphics invoices twice in the last two weeks with me,  Director VanGroningen still couldn’t get the information from his staff that I requested  over a month ago.

Director Van Groningen and General Manager Allen Short have been using MID’s Non-Purchase Order process to circumvent the system.  These two men took it upon themselves to spend  $24,000 that has been documented to this point and possibly more.  The problem is, all the staff has accounted for is $15,000 of the $24,000.  They’ve been using Martino Graphics to funnel money to Carol Whiteside of California Strategies.  Ms. Whiteside has acknowledged to myself and Van Groningen in an email, that she’s received $9,000 so far with another $6,000 pending from September.  The problem, as I see it, is in a letter to the Board (Oct. 7,2012) in which she admits it became obvious in July she couldn’t proceed  with the agreed upon tasks so she resigned her contract effective August 1, 2012.  The invoices were sent in September from Martino Graphics.

Even if it’s decided she should be paid the $6,000 that has been held up, staff  to this point, has been unable or unwilling to explain why the remaining $9,000 was paid.  It didn’t go to Ms. Whiteside, so why did Allen Short authorize the payments?  According to Van Groningen, Ms. Whiteside has reviewed hundreds of documents but quite honestly I find that dubious. But then again anything to justify the expenditure.

What I find amazing is Van Groningen and Short are using this money (at least $15,000 of it)  to convince the remaining Board members to approve the Board/ General Manager/Staff relationship policy that Board members have refused to rubberstamp since they were sworn into office.  The dynamic duo of Short and Van Groningen tried to get outgoing members Cecil Hensley and John Kidd to approve it,  but Director-elect Larry Byrd made a request from the floor and asked the Board to postpone the vote until January.

Public Information Requests Reveal there is NO Contract between Ms. Whiteside and the MID

So what tasks did Ms. Whiteside agree to perform and how do you resign a contract you don’t have?  And what happened to the still unaccounted for $9,000 dollars?  There are many questions but few answers.

Now lets discuss Contract Purchase Order 54981. My copy of the Purchase order confirms it was valid from 19-JUL-10 thru 31-DEC-11  (If you’re wondering, that’s the way they write their dates.) Not to exceed $450,000 dollars plus costs and expenses.  But GM Short continued to use this Purchase Order thru this year to the tune of $127,000 dollars mostly in the amounts of $19,000 and $21,000 monthly.  They basically used the same generic billing month after month in the amounts of :

Client Meeting / Planning Fees…$5,000

Consulting ……………………………$7,500

Communication Services ………..$3,500

Outreach Transparency…………..$5,000

I requested the contracts for any subcontractors like Mike Lynch and Carol Whiteside, and once again I was told they weren’t available because they didn’t have contracts with MID but had them with Martino Graphics. 

I find the use of Martino Graphics as a shield to prevent the public from knowing where the money is going to be unconscionable. After all, if Mike Lynch is being used as a lobbyist the public has a right to know where their money is being spent.

If this is allowed to continue, how many more contracts, if any,  will we find to be “shields”?  Will we hear “oops my bad”, and then pretend everything is hunky dory? I believe one is one too many. Their problem is that PO#54981 was running out of money so they just switched to the Non-Purchase Order process. No one man, NOT even GM Short or Board President Van Groningen should be allowed to circumvent the system for their own benefit.  I’m not suggesting directly for personal enrichment, but for lubricating the wheels of their personal agendas within MID.

I’ll tell you just how ridiculous this gets. Today at the Budget Workshop we discussed Project Number 3XX965. It’s described as being PRJ- Miscellaneous Operating Expense Exp. for $10,000 for misc. administrative & general. So they can spend it on whatever they want and say “it’s in the budget” as they always do. Because that’s exactly what they said to explain away the use of an expired Purchase Order and the Non-Purchase Order process used with Martino Graphics.

You tell me if we need some additional spending constraints on the General Manager and the Board President.

Questions abound but answers, real answers,  are short in supply.  No pun intended.

A Quick Peek Behind the Curtin at MID

Where do we know Martino Graphics from?  

The answer is simple, co-owner Marian Martino competed in the political forums to replace Kristin Olsen after Olsen abandoned her City Council position to be a State Assemblywoman.

At the time, when asked, Ms. Martino chose not to supply a reasonable explanation as to why she  bailed out of the running for the council after she was proclaimed one of the three finalists (and in many viewers minds one of the best selections).  Marian has been seen occasionally at MID meetings.  She never speaks but one has to wonder if political consultant Mike Lynch traded his support for MID Director in exchange for stepping back as a candidate for council.
MID General Manager Allen Short confirmed the money paid to Martino Associates, a Graphic Design firm,  actually ended up in  political consultant Mike Lynch’s wallet.
Nothing that MID Directors Tom Van Groningen, Glen Wild, Paul Warda or the people in the shadows behind them do can be taken at face value. 
And it appears that the evil emperor Allen Short has persuaded Director Nick Blom to join the dark side.

MID uses Deception to Hire an Old School Lobbyist

By Emerson Drake

It was revealed at Tuesday’s MID board meeting that General Manager Allen Short and MID Board President Tom Van Groningen used a company named Martino Graphic Design to funnel money.   This money went to a local political consultant named Mike Lynch, on MID’s bill paying ledger, under the guise of public affairs-2012 in the amount of $4582.97 for the month of March alone.  Mr. Lynch has his own consulting firm called, no surprise, Lynch Consulting, so why the deception?

Lynch has been going around to local political wannabees and others like Ruben Villabos,  Modesto School Board President and OFFERING his services to them when they run for election or re-election as necessary. One of Lynch’s most obvious Charlie McCarthy dolls (ventriloquist dummies) is Josh VanderVeen (LCR member), stepson to Modesto Councilman Dave Lopez. Both of these men and three others spoke for the water transfers.  As a long time MID meeting attendee it needs to be said none of these people ever came to a MID meeting until Mike Lynch became involved.

But Lynch found his “mother lode” in the LCR or Latino Community Roundtable. This organization which consists of 195 members, many of whom are politicians ($10.00 to those over age fifty, and then you get to vote for yourself) who have stood in front of the LCR hoping for endorsements.  LCR represents no constituency other than themselves and whom could only field 18 members at a recent political forum they held at, surprise, the Modesto School board office thanks to LCR  member Villabos.  While I’ll be one of the first to say LCR has many well-meaning members of the general public they also have those craving a seat at the local political table and Mike Lynch holds out his “free pass” to the promised land.

PART of your electric utility payments are being used to finance the posturing of political wannabees

Now campaign consultants have been making promises to candidates  for quite some time, after all it’s how they make their money, but to my knowledge this is the first time a public organization like MID has PAID  a consultant to potentially alter the political landscape using Public/RATEPAYER money.

Mike Lynch personally contacted each and every Modesto City Council member and asked for the Letter to MID not be written (it’s available on this website). Then Lynch sent Ruben Villabos, apparently his personal emissary, to a “private session” of the Council with foreknowledge of what was to be discussed.

Which Councilmember tipped of f Mike Lynch and Ruben Villabos about the secret topic?

That was the question at last night’s City Council meeting. Former Modesto Mayor Carmen Sabatino appeared in front of the Council last night to question the minutes of last weeks meeting which DID NOT mention Vallabos’ appearance. Sabatino questioned the validity of Villabos appearing and was reassured by City Attorney Susan Acala Wood his appearance was legal under the Brown Act. The Council said the minutes would be changed to reflect Villabos’ appearance.

But the over-riding question spoken by Councilwoman Stephanie Burnside was “who tipped Lynch/Villabos off?”  Nobody was forthcoming regarding this.  Looks went around the room but no one was willing to fess up. Needless to say  Diogenes is still looking with his lamp.

So where does this leave us?  Well, our electric payments are going to a political consultant without our consent who is bent on giving away our water, and our best hope, is the City Council sticking to their guns.

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