Oxnard Councilman Perello makes serious allegations re: Public Works, stresses whistleblower protection

OxWaterPlantBy George Miller

Councilman Perello was full of surprises at the Council meeting on Tuesday. Earlier, he had alluded to  announcements to be made during another agenda item later in the evening. That Agenda item turned out to be the update on the Water Supply Outlook Report,  which focused on mandatory conservation measures (see report: Presentation: Item H2: Water Supply Outlook Drought Response Mandatory Conservation Desalter Update (PDF – 302 KB)  Staff report: http://oxnard.granicus.com/MetaViewer.php?view_id=46&clip_id=2834&meta_id=142130). It also contained an update on the troubled desalter, which has been down for 2 1/2 years and only brought back online recently after a push initiated by new City Manager Greg Nyhoff.

While public works was explaining the history of the desalter project, it was mentioned that sand in the wells contaminated the reverse osmosis filtration membranes, motivating employees to shut it down to prevent further damage to the $1.5 million dollar components and it was now back online. (A previous local newspaper article had attributed this serious outage to failed wells, failed pumps and a leaking chemical tank. The long outage was attributed to manpower shortages.)

Also covered on KADYTV.net news report at about 3:25 …


Right at that point, Perello stated that after a 2 1/2 year downtime, the desalter was only operating at half capacity, which had cost the city (and ratepayers) at least $8 million additional in imported water charges.  Further, it had probably been shut down because of contaminants from a feeder tank.  That tank had a murky “chain of custody” and had carried very toxic contaminants in previous uses (oil industry and landfill leachate), something not at all good for a key component of a potable water system. It was also alleged that proper maintenance wasn’t performed during the long outage, resulting in things such as a frozen valve.

The desalter was restored to an output of only approximately 4.5 million gallons/day, compared to its rated capacity of 7 million. Public works attributed this to broken pumps and non-functioning wells.  Output should be 22 acre-feet per day, at an estimated cost of $400-700. Instead, Oxnard had to import water at $1000/ac.ft.

An investigation is only now getting underway, but Perello felt that the allegations had enough credibility to be revealed at a public meeting at this point.  At the meeting, no specific blame was placed on individuals, but Perello said “someone is to blame.” He and City Manager Greg Nyhoff have been working on this and are grateful that an employee brought it to their attention.

Perello has lamented the fact that some major problems such as this are not brought up through the chain of command.  Another recent case was a failing $30+ million tank at the wastewater treatment plant, a big, unpleasant surprise for the City Council. These are not accusations of criminal wrongdoing, but more likely incompetence or non-feasance.  These are management problems and clearly measures are needed to help make other such situations less likely.

However, Perello also referred to the roughly $1 million worth of water which  had been delivered to Procter + Gamble without any payment, or even billing, for that matter. This was attributed to improper valve settings, but nothing has been made public as to any management controls, or P+G offering to pay for the extra water. Some say this should be a criminal matter, but there’s no evidence of intent to defraud as of this date.  It’s not known what the status is regarding attempts to recoup this sum.

Perello also referred to a previous incident where city employee Phil Molina was fired for speaking out of turn and blowing the whistle. He sought legal redress. Perello lamented that this could happen and reiterated the call for better protection of whistleblowers, which is supposedly to be provided by law. Will Oxnard be subject to legal/financial liability for failure to respect the law?

The upshot of all this is that employees appear to be uncomfortable with speaking out on problems via the chain of commend and in whistleblower situations, a common problem in human organizations around the world.

The City has had an acting Director of Public Works since former director Ken Ortega resigned suddenly and Former City Manager Sotello was placed on leave of absence, his contract not renewed (he litigated it). Also, the Water Director (Mr. Emmert) left months ago for greener pastures.  The city had interim City Manager Karen Burham in place for two + years, until the June 1 start date of a new Manager. Acting Public Works Director Roshanian said his door is always open for employees who want to talk. The same is true for new City Manager Greg Nyhoff and relatively new Councilman Perello, who seem to have many takers.  It is unclear how well the Public Works open door policy is communicated to employees and how confidence is established to be open about problems and suggestions from knowledgeable employees.

Some companies have very strong whistleblower protection against reprisal policies, which are well-communicated and enforced. Openness is also promoted through various techniques, such as MBWA (Management By Walking Around), where managers spend a lot of time in the field, at the workplaces of employees, contractors, customers. This can help them discover things by being in the trenches, establishing improved rapport with employees and other stakeholders and seeing things that they might not otherwise discover via conventional chain of command and informal reporting systems.

Mayor Tim Flynn said that if the allegations are true (pending further investigation) that action must be taken.


A separate article will run later on the water conservation measures.


George Miller is Publisher of Citizensjournal.us and a “retired” operations management consultant, active in civic affairs, living in Oxnard.

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Eileen Tracy

I do wonder if the offending Chevron tank has been replaced, cleaned, and still in use. What is the replacement costs?

Secondly, what was the cancer rate from 2008-2011? A family member suddenly developed thyroid cancer within this time frame.

George, this is an excellent report. Thank you.

Steve Nash

Just to clarify the situation, if I might. Councilman Perello’s statements involved the City of Oxnard’s Water Campus, located on South Hayes Avenue. The problems were not with the Advanced Water Purification Facility located on Perkins Road. The Desalter at the Water Campus has a production limit of 7.5 million gallons of water per day (mgd). From the City of Oxnard’s Water Section web page, “In 2008, the City completed work on its state-of-the-art Brackish Groundwater Desalter. This 7.5 million gallon per day reverse-osmosis treatment facility located at the City’s Water Campus has been successfully removing minerals and softening water from local impaired groundwater at a fraction of the cost of imported State Water Project water.” These are the facts . . . the groundwater pumps were shut down in December, 2011. They were repaired and restarted in July, 2014. This was not “routine maintenance”. This was an unplanned and unexpected equipment failure that shut down the entire Water Campus for 30 months. So if I do the math . . . 7,500,000 mgd / 326,000 g / AF = 23 AF / day. 23 AF / day x 365 days per year = 8397 AF / year. 8397 AF / year x 2.5 years = 20,992 AF of product water lost due to the shutdown of the Water Campus system. Now this lost production had to be made up by water purchases from Calleguas Municipal Water District which is a member agency of Metropolitan Water District that receives much of its water from the State Water Project (imported water). This State water costs around $1,000 / AF. So if I multiply 20,992 AF of lost Water Campus water by $1,000 / AF for Calleguas water, I get $20,992,000! Someone’s not telling the truth as to the real cost to Oxnard ratepayers. This was strictly a financial reckoning and does not even include the health, safety and welfare aspects of using an oil-field / leachate tank for potable water purposes. Someone should be held accountable and I would lay the blame at the previous City Manager (Ed Sotelo) and interim City Manager’s (Karen Burnham) feet. The City Council were kept in the dark and can exercise, I believe, “plausible deniability”.