State grant funding for the San Simeon Community Service District (SSCSD) Water System Improvement Project was removed by a unanimous vote at the County Board of Supervisors last week.  The loss of $500,000 in grant support will delay the planned construction of a new water tank in San Simeon.

     Three reasons were provided for removing the SSCSD project from the State Integrated Regional Water Management (IRWM) Round 1 Grant to the County Regional Water Management Group.  First, the timeline for securing an easement or other legal instrument for locating the new water tank on Hearst Corporation property is uncertain.  Second, the additional funding needed for the project is not being pursued.  Finally, there remains an uncertain timeline for project design.  SSCSD has been deemed eligible to submit an application for partial project reimbursement through the IRWM Round 2 grant but must re-compete with other communities in the County for possible funding in 2022.

     Also last week, the State Fair Political Practices Commission (FPPC) voted unanimously to impose a $4,500 administrative penalty on Charles Grace for violation of the conflict-of-interest provisions of the Political Reform Act.  Grace’s firm Grace Environmental Services (GES) signed an amended and restated contract with SSCSD last month for provision of general manager services.  The FPPC penalty, however, stems from a contract executed in 2016 between the SSCSD and GES that netted nearly $400,000 through 2020.  GES currently is also the subject of a civil suit filed by the County District Attorney’s Office alleging illegal business practices.

    The FPPC held that liability, even criminal liability, can accrue without fraud or dishonesty.  Public harm occurs when any public official acts on both sides of transaction by eroding the trust that the public has in their government officials and in their contractors.  Government Code Section 1090 includes an explicit prohibition against “self-dealing.”  Any contract in violation of 1090 is considered void, such that SSCSD is entitled under the law to recover any compensation paid to Grace and GES from 2016 through 2020.  As this is the first 1090 violation heard by the FPPC, the process for taking legally correct action to void the contact will receive further attention at its January meeting.

     Both William Maurer and William Carson have notified the SSCSD Board of their resignations which would leave the five-member Board with only three Directors for the December meeting.  Applications for the Maurer position can be found at:; applications must be submitted by 10:00 a.m. on Monday, November 29.  There has been no community-wide voting for SSCSD Board Directors since 2016.