Conflicts of interest raise questions for Rivanna panel

By Jeremy Borden

Published: May 20, 2008

Three of the five members of the Rivanna Water and Sewer Authority had to recuse themselves Monday from voting on part of its $22.1 million budget because of conflicts of interest.

While the recusals largely resulted from a quirky law that the RWSA’s attorney said was not intended to affect the agency, some question the wisdom of the board’s makeup and suggest the conflict-of-interest snafu is symptomatic of a larger problem: that the water wholesaler is controlled by the very organizations it charges.

“We certainly don’t want to get into a situation where the majority of the authority can’t vote on fiscal matters,” said Lois Rochester, a member of the League of Women Voters, an organization that has studied the issue. “That would be very undesirable to say the least.”

The relationship works like this: Rivanna charges the city and county wholesale rates for water and sewer services. Those rates, in turn, are determined by Rivanna’s five-member board, made up of two Charlottesville employees, two Albemarle employees and one at-large member.

Rochester said she believes that structure influences board members to keep rates artificially low and has them worrying more about ratepayers than about the state of the infrastructure.

“There [is] nobody on the board representing the public, and that’s a mixed bag,” Rochester said. “As an authority it is not directly responsive to the people because they’re not elected by the people.”

Albemarle Supervisor Dennis S. Rooker said he doesn’t know if rates are kept too low — he hasn’t seen that evidence, he said. He’s not sure whether having elected officials on the board would make the organization better off.

“The system we have in place right now works pretty well,” Rooker said. “Having a group of citizens appointed to a board whose primary responsibility is water and sewer is a wise thing.”

The executive director of the Albemarle service authority, Gary Fern, sits on the board, along with Albemarle’s county executive, Robert W. Tucker Jr. City Manager Gary O’Connell and Judy Mueller, the director of public works, represent the city. Michael Gaffney, the founder of Gaffney Homes, serves as the at-large member and chairman.

Mueller, O’Connell and Fern all read statements Monday saying that the decision in front of them — the RWSA’s budget and water rates affecting city and county residents — would be to their personal benefit or detriment and thus recused themselves from the part of the vote that would affect their organizations.

Kurt Krueger, the authority’s lawyer, said he had made a conservative reading of a technical law and wanted those board members to recuse themselves on the budget and rates vote to comply with the law. He said it would likely not affect other votes.

“It seems a little bit unusual to me, but that’s the wisdom of the state,” O’Connell said. The same law affects the Rivanna Solid Waste Authority, a board made up of most of the same members with the exception of Fern.

“The state needs to change the law,” Gaffney said.