Examiner.com reported last month that the Orange County Sanitation District (OCSD) voted to amend its contract with EnerTech, the Slurry-Carb facility located in the Inland Empire city of Rialto. The company has been in default of its contract with Orange County Sanitation District since it first began to accept biosolids, costing Orange County taxpayers at least $100,000 a month. Additionally, the contracts have cost three of the four other entities which also contract with EnerTech, the cities of Riverside and San Bernardino and the Los Angeles County Sanitation District, undetermined sums of money, thought to be in the millions of dollars, since ratification of the contracts.
Although there are a total of five jurisdictions which contract with EnerTech, the four listed above and the city of Rialto, the Orange County Sanitation District remains EnerTech’s key financial supporter. The taxpayers of Orange County have subsidized the company with millions of dollars in additional costs to keep the company afloat.
In February the Board of Directors voted to continue the contract one more year to allow EnerTech to comply with its terms. The cost was adjusted downward but still exceeds what competitors would charge for the same service.
There were four members of the Board of Directors who voted against EnerTech, including Councilman Jon Dumitru from the city of Orange. Dumitru agreed to be interviewed for this story.
The councilman indicated he voted against EnerTech simply because it is too expensive to continue supporting failed technology. When ask why so many members of the board voted in favor, he said that there was a lot of confusion created by the staff report. He also said that this is not the first time he has been on the losing end of a vote that would cost constituents significantly, citing a substantial rate increase he voted against several years ago. No doubt some of that rate increase has gone to subsidize EnerTech’s failed technology.
Examiner.com has obtained both a copy of the report by OCSD staff and a report prepared by a third-party consulting firm on behalf of EnerTech’s bondholders. The OCSD staff report is both confusing and misleading. Examiner has been told by an outside source that our figure of $100,000 a month is likely too low. Dumitru confirmed that claim. Our figure was based on information received pursuant to a California Public Records Act request.
Dumitru is one of only two elected officials who has agreed to speak to us on the record. Chairman of Board Larry Crandall, who is a councilman for the city of Fountain Valley, painted a different picture of the EnerTech contract. Although he agreed that the company is in non-compliance and has been for some time, he felt that OCSD owed it to residents to invest in new technology. He said he felt that land application of biosolids would be phased out and alternatives are needed.
Almost all others who have spoken with us have said that the EnerTech contracts are “political” in nature and have admitted the venture has been a boondoggle for taxpayers and a drain on already stretched budgets. Every staffer we have spoken to has expressed concern to at least some degree about telling the truth about the EnerTech contracts. No one has been able to offer a legitimate reason for the continued support by elected officials in each of the jurisdictions.
We are continuing to review FPPC 700s and 460s for all elected officials involved in the EnerTech contracts to determine if there are obvious conflicts of interest that would explain their support. So far, no one has offered a better reason for these entities subsidizing a private company that is not in compliance with its contracts.
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