Sean Janssen, The Union Democrat

Misconduct by a former manager, illegal sewage dumping and a board member's possible conflict of financial interests are among the issues overshadowing Murphys Sanitary District.

The various scandals have so far forced a one-month absence of former top manager Ralph Emerson and led to the possibility of state fines that have reached $1 million in similar local cases.

General Manager Julio Guerra, hired in January after the district went four years with the position vacant, still believes he can get the district on solid footing and keep it viable on its own.

"We have got issues that need to be addressed that we've got to seek outside funding for. Murphys is a vibrant community. There's no reason a well-upgraded system cannot function on its own here and I hope to facilitate that," he said.

A Feb. 1 state inspection at MSD led to a report finding that sewage sludge stockpiles created in 2004 and 2010 on the district's property are in violation of state solids-disposal requirements.

Guerra said his own investigation determined the district was required to submit a solids handling plan in January 2002 but never completed it. In recent months, samples have tested above permitted levels for nitrates and coliform bacteria as a result of the stockpiling, creating contamination concerns for nearby groundwater. The district will have to spend more than $50,000 to remove the sludge to a disposal site.

The district's top employee while the GM role remained vacant, Operations Manager Ralph Emerson, said he handled the sludge for years as directed by the board. However, in an interview Friday, Guerra said he has not been able to determine such direction from his review of past board meeting minutes.

The Jan. 8, 2002, letter from the Regional Water Quality Control Board that demands a revised sludge management plan, which Guerra said was never completed, is addressed directly to Emerson.

The state board is also looking into the district's bypass of a filtration system last summer that allowed partially treated sewage to reach the Kautz property on Six Mile Road.

Guerra met with RWQCB regulators April 20 to discuss the likely violations. Wendy Wyels, RWQCB environmental program manager, said the board is working on notices of violation to send to Murphys Sanitary and has not yet determined whether it will impose fines for those violations.

"There's issues with the sludge stockpiled, nitrate in groundwater (and) sampling practices," Wyels said. "Staff did not say one way or another whether there will be fines or not (in the April meeting)."

Steps for the district to take will be outlined in the violation notices, she said.

"We expect voluntary compliance," she said. "If the district does x, y and z by (deadline) dates, we will not issue a fine."

The district purchased 23 acres in recent years to help enhance its disposal capacity, Guerra said, and "avoid what happened before." The land is undergoing environmental review for possible use as an area to spray treated wastewater.

The impact of potential fines from state regulators could damage the tiny sewer district - which serves 837 connections and about 1,500 people on an annual budget of roughly $1 million. The Calaveras County Local Agency Formation Commission, which helps regulate special districts, opined the district either ought to dissolve or combine with another larger service provider before the violations were revealed.

Similar sludge storage issues and failure to have proper planning documents in place were outlined in an April 9 violation letter to the Groveland Community Services District that warns of $1 million in potential fines. In September 2011, the RWQCB fined thecity of Angels Camp $125,000 for a spill of less-than-tertiary treated wastewater into Angels Creek.

Emerson clashes

with board

Tensions between Emerson, the district's longest-tenured employee at 17 years, and directors have flared up in recent months.

The board suspended him for 30 days without pay in September 2011 and denied his request to be paid for accrued vacation time during the suspension.

Emerson requested the disciplinary matter be aired publicly at the Sept. 12 board meeting, in which MSD attorney Ken Airola revealed he had referred to then-Director Cynthia Trade in grossly profane terms specifically derogatory toward women in the presence of administrative staff Cindy Nugent and Marilou Miloslavich.

Airola noted Emerson later apologized to each of the three women.

"There's no excuse for losing one's cool," Emerson told the board. "It's obviously not what I think of Cynthia. I respect Cynthia. There's no justification but it was a series of events that took place."

Emerson said he heard Trade had told staff they would not receive raises in the next year, "and then I hear from a staff member that an evaluation form that I use, that I developed, to evaluate my employees was being asked to be changed without coming to me."

Then-board member Jim Riggs noted Emerson's words included "degrading terms against women."

Director Patricia Davies said Emerson had also violated a district policy against practical jokes and once hid her car keys from her.

"It was meant in good-hearted fun," Emerson replied. "There was no maliciousness. I am so sorry you were offended by that."

Riggs also explained that he heard from Emerson that three local business people informed the operations manager Riggs had been seeking out potentially negative information about Emerson.

Emerson hesitated to name those individuals.

"They don't exist," Riggs said. "That's why you can't name them."

"I have a lot of the names but a lot of them are your friends and it doesn't look good for them if their names come out because then you're going to ask, 'Where's the trust?'" Emerson said.

It seemed to hurt Riggs to bring the complaint forward, calling Emerson "a friend of mine" he had gone hunting with in Minnesota in the past.

District operators Brain Langley and Tyler Giuffra strongly urged the board not to dismiss Emerson, prior to the board entering closed-session discussion of Emerson's punishment.

At the district board's meeting last month, Guerra addressed a letter from Emerson's attorney seeking records of MSD board meetings for the past year. Guerra said the request surprised him and he would have provided the data to Emerson upon simply asking verbally. Emerson said he had "no particular reason" for requesting the information, adding that he had missed some meetings and "wanted to know what people are saying about me."

In an April 26 meeting of the board's personnel committee, a proposal to demote Emerson from "operations manager" to "field supervisor" was discussed, a move that may lead to a cut in his $62,400 annual salary. Emerson submitted a letter in protest, showing his salary is lower than most area agencies' compensation for employees with similar experience.

"I don't feel it is right to take money from me when I am already underpaid for my experience and years of service," he wrote. "I don't receive daily instruction from anybody and am trusted to make the appropriate decisions for daily operations and will continue to do so."

District office

ownership conflict?

The Murphys Sanitary District office at 90 Big Trees Road, Suite B, is owned by Director Patricia Davies, who receives $350 in rent from the district each month. A five-year lease for the offices was approved in November 2010 during a brief hiatus from the board by Davies.

Then-board President Beth Hartline submitted an agenda item for the Oct. 12, 2010, board meeting to address what she saw as a likely conflict of interest. Prior to that agenda item, Davies submitted her letter of resignation "based solely on Government Code 1090," which addresses conflicts of interest, according to meeting minutes.

Hartline resigned when the board next met on Nov. 8.

Hartline said her formal reason for leaving was she lacks time to devote to the board.

"But, for the record, I turned down a board position at MSD three times before I accepted, and … it was clear to me after ethics training, that state law prohibits directors from benefiting financially from their position. When I realized that I couldn't get enough votes to prevent or correct significant risk to the district or myself, I resigned."

In a Nov. 15 special meeting, the board approved the lease with Davies, now a private citizen. However, she applied and was appointed to fill a vacant board seat at the next meeting on Dec. 13.

When asked Monday if the lease represents a conflict of interest, Davies said, "I never thought there was. At one time, there was a question and it was straightened out as far as I know."

Airola was more cautious.

"Right now, we've avoided any conflict of interest but it will be a problem in the future," he said.

No modifications, renewal or addendum can be made to the lease, Airola said.

"It's not an ideal situation," he said. "We're taking steps to avoid any violations … but we can't find a cheaper place. That's a function of being in Murphys."

Guerra said he submitted a possible relocation as an agenda item in the February meeting but the board took no action.

The Union Democratsought a legal opinion on the situation from the Calaveras County Counsel's office but a spokeswoman said Wednesday that the office only gives advice directly to government agencies.