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Water district candidate challenges 'unfair' tax

Gary Kremen isn't pulling any punches. The founder of Match.com kicked off his race for a seat on the county water district board with a harsh critique of the district's performance, and claims the water district has "stonewalled" local property owners on what he says is an unfair tax.

Kremen is the sole challenger running against incumbent Brian Schmidt for the District 7 seat on the Santa Clara Valley Water District Board of Directors. District 7 includes Mountain View, Palo Alto, Los Altos and Los Gatos.

One of Kremen's top issues is water district taxes. Kremen said property owners in Palo Alto, Mountain View and Los Altos Hills pay millions in California State Water Project taxes every year, but don't see the same payoff as the rest of the county because they don't receive state water.

Unlike most of Santa Clara County, Palo Alto, Mountain View and Los Altos receive a majority of their water from the Hetch Hetchy water system, operated by the San Francisco Public Utilities Commission. Only 10 percent of Mountain View's water comes from state water sources, and Palo Alto receives none at all.

As a result, property owners in these cities subsidize other areas of the district without getting "material benefits," according to Kremen's campaign website. Though Santa Clara Valley district officials argue that the north county area receives other, smaller benefits from the tax, Kremen argues that the only benefit worth mentioning is access to state water.

"It boils my blood that people could support this tax," Kremen said.

Crunching his own numbers, Kremen estimates that Mountain View foots the bill for an annual $1.2 million every year in state water project taxes. The Santa Clara Valley district could not confirm the tax dollar amounts by the Voice's press deadline Wednesday.

If elected, Kremen said, he would fight to get more water conservation funds for areas that receive little to no state water to compensate for the inequity. He said he would look for ways to get cash rebates for property owners who use Hetch Hetchy water, or remove the state water tax from those areas entirely.

Kremen said he would also vote to return the already-paid tax money to property owners who use Hetch Hetchy water.

These solutions seem unrealistic to Schmidt, who said Kremen would be hard-pressed to get the other six board members to vote for a tax exemption or increased funding that would specifically benefit his district.

"You could argue that Palo Alto and Mountain View should receive more water conservation funds, but good luck passing that," Schmidt said.

Schmidt said he agrees that the northernmost region of the county doesn't reap the same benefits from the state water tax, but the money isn't flexible -- it has to be spent on state water projects.

He suggested that the district could compensate the region by using other funds to improve recycled water infrastructure in areas that rely on Hetch Hetchy water. Those improvements could include expansion of pipelines for recycled water around Stanford and other areas. Expansion of recycled water infrastructure, Schmidt said, would be a far more palatable option for other board members.

Kremen has also come out in support of recycled water infrastructure in the area to compensate for the tax inequity.

Mountain View flood projects

Kremen criticized the water district for what he says is poor management of flood projects, citing its attempt to build a flood basin at Cuesta Park Annex. The flood basin was part of the Permanente Creek Flood Protection Project -- a heavily revised project that took years to get approved by the Mountain View City Council.

The project originally included constructing four flood detention basins to protect 2,720 Mountain View properties in the event of a 100-year-flood -- including one at the Cuesta Park Annex. The plan drew sharp criticism from the public before the district staff updated the hydrology for the project and realized that a flood basin at Cuesta Park Annex wasn't needed in the first place.

The changes to the project frustrated public officials like Santa Clara County Supervisor Joe Simitian, who told district officials last year that he was skeptical of the flood project and felt they had lost credibility when they made drastic changes partway through the planning and design phases.

The sentiment was similar at last year's May 14 Mountain View City Council meeting, when council member Ronit Bryant said "the process has been long, and tortured, and really unsatisfactory in lots and lots of ways."

At the same meeting, council member Margaret Abe-Koga said, "I felt like I stuck my neck out. And then to have the project changed and say, 'Well we didn't really need Cuesta Annex,' that has really been a frustration and a disappointment."

Kremen said the proposed Cuesta Park Annex flood basin was a "debacle" and that the district failed to listen to the local community. He said it has also been a wasteful project, and that the district has spent $20 million prior to construction because of all the delays and redesigns.

Kremen's list of endorsements include Abe-Koga as well as Mountain View council member Michael Kasperzak, according to his campaign website.

Potential conflict of interest

On his campaign website, Kremen accuses Schmidt of having an undisclosed, potentially major conflict of interest because of the job he held when he ran for the water district board.

Schmidt was an employee of the Committee for Green Foothills, a Bay Area nonprofit environmental organization that could benefit from additional water district funds. Schmidt's potential conflict of interest was supposedly discovered by local news outlets before he "unexpectedly" quit his job, according to the website.

But Schmidt denied the allegations, and said that he had disclosed his potential conflict of interest before taking office during his campaign in 2010.

"I acknowledged that potential conflict of interest from day one," he said.

Schmidt said controversy over his job at Committee for Green Foothills surfaced in 2011 when the board considered redirecting funds into flood projects, and someone suggested some of that money go to the committee. Schmidt mentioned he may have a conflict of interest deciding where that money goes, and district lawyers explored it in an attorney-client memo.

Schmidt said the information in the attorney-client memo is confidential and that he can't release it to the public, but that didn't stop one local newspaper from asking him for it. Schmidt said a story in the Mercury News in 2011 indicated that he tried to keep the details of his possible conflict of interest a secret.

"I couldn't release the memo," Schmidt said. "That would be blatantly unethical and I'd risk being censured."

Kremen said nobody can say for sure whether Schmidt had a conflict of interest until that memo is released.

"It's really hard to say what his conflict of interest is because it's a secret," Kremen said. "And how many times has he called on the board to release it?"

Following the controversy, Schmidt left his job at the Committee for Green Foothills.

"I still feel like I went above and beyond when I quit," Schmidt said.

He said Kremen himself might be looking at a possible conflict of interest if elected to the water district board. Kremen is currently the board chair for WaterSmart Software, a tech company that creates water meter software.

Kremen said WaterSmart does not have any relationship with the water district, nor are there any plans for the company to do business with the district. He said even if WaterSmart decides later to work with the district, he would never take a role at the company where he would receive money, be employed or act as a consultant.

Comments

 +   Like this comment
Posted by Make Bike Trails
a resident of Shoreline West
on Aug 15, 2014 at 12:19 pm

Schmidt followed the Mountain View City Council and gave up Permanente Creek Water District right of way on both sides of El Camino, permanently blocking the Southward progress of the bike path along Permanente Creek, and giving up a great spot for a bike crossing of El Camino. He also voted for retention ponds instead of daylighting the creek from El Camino to Villa and increasing its capacity.

I hope Kremen unseats Schmidt, and opens up water distict right of way to safe seculded from traffic bike paths, rather than the blood letting we are currently seeing, from the unprotected stripes along busy streets, that conflict with driveways and side streets, our city engineers continue to pretend are bike paths.


 +   Like this comment
Posted by Gene Beley
a resident of another community
on Aug 16, 2014 at 12:48 am

Although I no longer live in Santa Clara County, I hope Kremen wins, because this trend towards using property taxes to finance the outrageous twin tunnels is beginning to turn elected officials into dictators who look for ways to spend billions of dollars without a taxpayer vote. Governor Brown is the poster child for this movement via the twin tunnels and now the new gas tax, effective Jan. 1, 2015, that will begin adding on 16-76 a gallon to our vehicle gas purchases, and provide him a slush fund for the non-bullet train and who knows what else. We've got to get rid of politicians who think this way. Good lucky, Mr. Kremen!


 +   Like this comment
Posted by Carlos Britto
a resident of Martens-Carmelita
on Aug 17, 2014 at 11:35 am

I also hope Kremen wins. This twin tunnel / Southern California water giveaway that the Water District supports and Brian Schmidt voted for is crazy. Why should rich farmers in Kern County get cheap water to export walnuts to China while we have to pay for these higher water rates?

Also what kind of elected can't horse trade a get her other district members to right a wrong; that is we pay much more than South County for water. They even get the tax rebated back to them in the Orwellian named "Open Space Credit," which is another name for a tax payer handout. Other board members need things for their district and why does Schmidt not understand how to bring home the benefits to the people who elected him?


 +   Like this comment
Posted by Ted
a resident of Martens-Carmelita
on Aug 20, 2014 at 4:44 pm

How does the incumbent work only as a water boardmember and get by? Why is there no story on that oddity?


 +   Like this comment
Posted by Carlos Britto
a resident of Martens-Carmelita
on Aug 23, 2014 at 9:21 pm

My understanding Ted is that he gets the highest per diem fee in the state for any water district - see Web Link


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