RMC Water and Environment, the company that was Cal Am’s project manager for the first attempted desalination project, has found itself in hot water again in San Jose.
Two recent news reports focus on a $4 million contract that was awarded to the San Jose company without competitive bidding by the Santa Clara County Water District even though one of the district’s top officials is married to one of RMC’s owners.
The new reports, on the San Jose Inside website and on NBC Bay Area, said the district’s board wasn’t aware of the relationship when it approved the contract on a 5-2 vote. The dissenting voters, including the board chairman, have called for a formal outside investigation.
The contract is one of several the district has awarded to RMC over the past several years. It calls for the company to draw up plans for a water-recycling project.
In Monterey County, RMC was accused in 2011 of making $160,000 in under the table payments to county water official Steve Collins while he and the company were working on Cal Am’s first effort at a desalination plant for the Peninsula. Collins pleaded no contest to conflict charges but RMC was never charged. The criminal case played an important role in ending the project, but Cal Am is attempting to move forward with a different plan. The current project has stalled, also because of conflict of interest concerns, this time involving a hydrologist who had been retained by the water company and the Public Utilities Commission to analyze water well technology for which he holds the patent.
According to the news reports, Melanie Richardson, deputy director of the Santa Clara water district, reported in a statement of economic interests filed in 2010 that she held stock in RMC worth between $100,000 and $1 million through her husband, RMC principal Tom Richardson.
Melanie Richardson and RMC have denied any wrongdoing. The district’s top official, Beau Goldie, told NBC Bay Area that the district had looked into the relationship several years ago and determined there was no conflict. He said Melanie Richardson has no role in awarding contracts to RMC.
The contract awarded to RMC without competition involves design work for a recycling plant that could cost as much as $800 million. District insiders told reporters they feared that RMC would have an inside track for that contract as well. Goldie said it was decided to hire RMC without seeking bids in order to expedite the process in response to the drought, but district critics said it would be at least four years before the plant could be operational.