STOCKTON, CA, Feb. 3, 2017 – State Controller Betty T. Yee announced this week that her team’s detailed review of the Panoche Water District has unearthed numerous examples of financial misuse, waste, and fraud in fiscal years 2013-15 in likely violation of both California’s Government Code and Penal Code.
The report found that between 2013 and 2015, the district had given employees $86,000 in interest-free loans and allowed them to use district credit cards for more than $37,000 in personal spending, including season tickets to the Oakland A’s and Oakland Raiders, Katy Perry concert tickets, and “retail goods from Ralph Lauren, Nike, and Sunglass Hut.”
“The district’s egregious lack of spending oversight is shocking. It is especially troubling in a region where effective water governance is so vital for the agricultural community,” Yee said in a statement. Panoche Water District, a small water district, spans 38,000 acres in western Merced and Fresno counties and is a member agency of the San Luis-Delta Mendota Water Authority.
The scandal recalls another revealed in March 2016 wherein the Westlands Water District loaned one of its executives $1.4 million to buy a riverfront home. Westlands Water District claimed its 2007 loan to deputy general manager Jason Peltier was allowed under agency rules on salary. Experts in governance say the deal raises red flags, not just over the unpaid loan and its generous terms but over whether Peltier and Westlands complied with laws mandating disclosure of the use of public funds.
Westlands sells water to big farmers and other landowners in the country’s largest public irrigation district. The company came under scrutiny in March 2016, when federal regulators levied a $125,000 penalty against it over bookkeeping and what a Westlands official as “a little Enron accounting.”
Peltier has since left Westlands and is now the Executive Director of the San Luis-Delta Mendota Water Authority.
Barbara Barrigan-Parrilla, executive director of Restore the Delta responded to the latest scandal:
“Panoche Water district is part of the San Luis-Delta Mendota Water Authority. SLDMWA receives taxpayer subsidized water and infrastructure through the Central Valley project. This agency games the system for their big industrial growers with taxpayer money. Now we know that in addition to subsidizing almonds for China, we (the taxpayers) are also subsidizing Katy Perry tickets for their water district officials. These are the same people who make constant demands on the San Francisco Bay-Delta for more and more water, and who are pushing for government subsidized Delta Tunnels that will destroy the largest estuary on the west coast of the Americas.”