Tuesday, August 08, 2017

SEC Investigation Question for Former Los Osos CSD Director, and Current Iowa House Representative, Stan Gustafson

TO: Stan Gustafson (R), Representative, District 25, Iowa Legislature
DATE: August 8, 2017

Hello Representative Gustafson,

I'm a blogger in SLO County, and I'm researching a story involving a SEC investigation into the Los Osos Community Services District, and I just have a quick question for you involving a key piece of evidence in that investigation.

The evidence is the LOCSD's "Summer 2000" newsletter, that I have made available for public download at this link:


According to the newsletter, you were a LOCSD Director, and a member of its "Wastewater Standing Committee" at the time.

Here's the screenshot (hopefully you can view it):

Now, in that newsletter it describes (in detail) a sewer system that you, as a LOCSD Director and Wastewater Standing Committee member, had been developing (for the previous two years) for the community of Los Osos -- a so-called "STEP/STEG" collection system with a "70-acre" treatment facility in the middle of Los Osos, comprised of several large ponds.

Additionally, your "Summer 2000" newsletter goes on to describe the 70-acre ponding system as "on schedule."

The newsletter also states that for your "better, cheaper, faster" sewer project to move forward, that, "yes," a property tax assessment vote would need to be passed by Los Osos property owners, and then outlined a series of dire consequences that would result if the assessment did not pass.

The newsletter, along with a lot of other LOCSD marketing material during the run-up to the assessment election, did the trick, and, as you know, the assessment passed a few months later.

However, as my investigation into this story clearly shows, including at this link:


... a March 7, 2001, LOCSD report shows that the 70-acre ponding system that you, as a LOCSD Director and a member of its "Wastewater Standing Committee," told "the residents and property owners" of Los Osos was "on schedule" in "Summer 2000," had actually completely failed by February 2000.

I asked an attorney if the above-scenario -- where a government agency produces a newsletter that states that a public works project is "on schedule," when the agency's own documents show that the agency was fully aware that the project described in the newsletter (in detail) had completely failed some six months earlier (and, frankly, was never even close to being a feasible option in the first place) -- constitutes fraud, and he told me, "Yes."

Furthermore, the reason I am asking you this question today (well, OTHER than that whole 'SEC investigation' thing), is because, as you also know, that property tax assessment vote that the newsletter heavily promoted for a "yes" vote (an election violation, by the way), and that was eventually passed back in 2001 to fund a known-to-be-fake "project" (that never even came close to being built), allowed the LOCSD, with you as a Director in 2003, to sell nearly $18 million in municipal bonds, and, as you also know, those bonds are (present tense) 30-year bonds, that are secured by the roughly $1.2 million per year that is collected from about 4,200 Los Osos property owners (at about $250/year) due to that assessment, an assessment that doesn't expire until the year 2033, for a fraud-based "project," that will never exist, of course.

In other words, the LOCSD's completely fraudulent "Summer 2000" newsletter -- and I mean, like, every word in that newsletter is a complete, and easily documentable, lie, and it has your name all over it (and in really bad places, I will point out) -- and, as the evidence clearly shows, was produced solely to trick Los Osos property owners into passing the assessment -- is STILL 100-pecrent relevant today, and will continue to be 100-pecrent relevant, 100-percent in play, until the year 2033, and, frankly, beyond.

So, with all of that in mind, my question for you today is: Why?

Why, as a LOCSD Director, and a member of its "Wastewater Standing Committee, did you send out a newsletter, in the Summer of 2000, to all "the residents and property owners of Los Osos," telling them that your known-to-be-DOA, "better, cheaper, faster" sewer project was "on schedule," and that, "yes," the property owners would have to pass an assessment vote to fund it (again, an election violation), when you were fully aware that it had already officially failed some six months earlier, and, in reality, was never even a feasible option to begin with?

Or... repeat: OR, were you even aware that your fellow LOCSD Board Director, and Waste Committee member, Pandora Nash-Karner was going to produce, and then mail that newsletter, as she confesses to doing at this link:

... and when you first saw that newsletter -- a newsletter dedicated almost completely to advertising the long-failed 70-acre ponding system as "on schedule," and "better, cheaper, faster," and with your name all over it -- did your jaw hit your desk?

Which one of those two is it?

Finally, I want to point out that there is a gigantic stack of evidence that shows that the Karners would/did benefit financially from the passage of the LOCSD's 2001 wastewater assessment, so, it makes PERFECT sense why Pandora Nash-Karner would produce, and then mail, that fraudulent "Summer 2000" newsletter.

However, what I can't seem to find, is one shred of documentation that shows that YOU (or your other fellow board members [sans Nash-Karner]) benefited financially from the passage of that fraudulent assessment, which makes me think that, of those two options above, it was the latter: You (and your fellow board members, by the way) had no idea that Nash-Karner was producing and then mailing out that fraudulent OFFICIAL LOCSD newsletter, and when you first saw it -- AFTER it was mailed to "the residents and property owners" of Los Osos  -- your jaw hit your desk.

That's it, isn't it?

So:

1)  Did you, like the Karners, benefit financially from the passage of the LOCSD's wastewater assessment, and therefore signed-off on that fraudulent newsletter BEFORE it went out?

or;

2) Were you even aware that your fellow LOCSD Board member, Pandora Nash-Karner, was producing/mailing that "Summer 2000" newsletter, and when you first saw it -- AFTER it was mailed out -- your jaw hit your desk?  

Which one is it?

If you have any questions, please just ask.

Thanks,

Ron
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sewerwatch.blogspot.com


P.S. In my own, personal, and, yes, I will add, beautiful editorial policy of what I like to term "open source journalism," I have cc'd this email to numerous media-types (and others), and have also published it on my blog, at this link:


Thanks again.

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Friday, October 14, 2016

Really? Trib columnist, Tom Fulks, is giving up tens of thousands of dollars of "political consulting" work, just to continue to write his "unpaid" column? I mean, Huh?

Campaign "Consulting" Question for Tom Fulks, please
Hello Stephanie,

I'm researching a story, and I just have a quick question for Tom Fulks, but I don't see a contact email for him in the tag line of his columns, so, I'm hoping that you would be so kind to forward this email to him.

Thank you! : -)

- - - - - - -

Hello Tom,

I'm researching a story, and I just have a quick question regarding one of your recent columns, at this link:


... where you write:

"The last time I was paid by (Supervisor) Gibson for campaign consulting work was June 2014."

I'm just curious: 2014 was the last time Supervisor Gibson ran for office, and, if he decides to run again, he'll likely be firing up his 2018 campaign sometime in 2017.

Now, as I've shown in my past reporting, for example, at this link:


... when Supervisor Gibson campaigns, his campaign pays you tens of thousands of dollars to be his "evil genius in the back room" (his phrase)/"political consultant."

Additionally, in his latest campaign filing, Supervisor Hill, in just the past few months, paid his "consultant," and your friend/colleague, Paul Hughes, of poliARC, more than $40,000 -- almost twice the amount of all contributions the Hill campaign received for that statement ["Monetary Contributions: $28,434.98"] -- with tens of thousands more from previous Hill statements going to your counterpart, Paul Hughes.

So, with all those huge stacks of cash in mind, I'm a little confused: When you write, "The last time I was paid by (Supervisor) Gibson for campaign consulting work was June 2014," are you saying that you have now somehow retired from your job as a "political consultant," and will now, for future elections, be giving up those huge stacks of cash that you are paid for your "political consulting" work, in order to continue to write your "unpaid" column for the Trib, or, when/IF Supervisor Gibson fires up his campaign next year, will you be giving up the Trib column in order to get paid the tens of thousands of dollars again by the Gibson campaign?

Trib Opinion page editor, Stephanie Finucane has hinted to me that you can't do both, understandably.

So, again, just curious: Next year, IF Supervisor Gibson fires up his campaign, will you be giving up the tens of thousands of dollars that he normally pays you for campaign "consulting" work, in order to continue to write your "unpaid" column for the Trib?

As always, much thanks,
Ron

Oh, and P.S: As usual, this email posted to my blog, SewerWatch, at this link:


- - -

[Thanks again, Steph!]

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sewerwatch.blogspot.com

Tuesday, August 30, 2016

Los Osos Sewer Hook-Up Percentage Question

TO: John Waddell, SLO County Public Works Dept., Project Manager, Los Osos sewer project

- - -

Hello John,

I'm researching a story, and I'm just curious on what the sewer hook-up rate is in Los Osos?

For example, on the county's web site, at this link:


... it reads:

"Phase 1 of the sewer lateral connections of individual properties began on March 28, 2016..."

The site also reads, "... connections are required to be done within 180 days."

So, now that it's been almost "180 days" since "March 28," this is my question: As of August 30, 2016, what percentage of properties in "Phase 1" have hooked up to the sewer?

80-percent? 90-percent? 50-percent? Less?

The total number of properties in "Phase 1" would also be useful in my reporting.

Finally (and again), what happens to the property owners that do not hook-up "within 180 days?"

As always, much thanks,
Ron

P.S: This email posted to my blog, SewerWatch, at this link:


Thanks again.

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sewerwatch.blogspot.com

Tuesday, August 02, 2016

An Open Letter to the Local Media on Why They Should Foot the Bill for a $150 Report, and NOT Me

[Note: The following is an email I sent today to editors and reporters at three local media outlets: Tribune, New Times, and Cal Coast News]

Hello Tribune, New Times, and Cal Coast News folks,

I am contacting all of you kind, generous, local media people to, well, ask you for a quick, fun, interesting, and, yes, kinda hilarious favor.

I'm hoping that one of you will buy a $150 report.

Here's the dealio:

As I've shown you over the past few weeks, by cc'ing all of you on a couple of my recent emails, that I also published on my blog, first at this link:


... and then a follow-up at this link:


... the bond rating agency, S&P Global Ratings, was recently forced to "suspend" its "BBB-" rating that they placed on the "Los Osos Community Services District Wastewater Assessment District... 2002 limited obligation improvement bonds," due to "lack of information."

That story is mind-blowingly newsworthy, on many levels, but here's the catch: If you go to the source, at this link:


...  that I used in my recent emails to expose that great local story, you'll see that the only thing S&P Global Ratings provides to announce their action on those bonds, is just a quick, one paragraph press release. However, the full 3-page report that (hopefully) explains exactly why S&P was forced to "suspended" its "BBB-" rating on the Los Osos CSD's bonds -- with all the juicy details (I'm assuming) -- costs $150-bucks to purchase.

And that's the point of this email: Me asking one of you fine, local media outlets to, please, fit the bill for a copy of that 3-page report, and then do a story on it, and, if you legally can, post the report on your web site (there might be some sort of "Fair Use" argument there that would allow you to post it), and then that, in turn, would allow me to continue my on-going reporting on this super-important story ('cause, I really don't want to shell out the $150-bucks, and I'm very curious to see what that report says).

Like I say, that report is, almost certainly, extremely newsworthy for not only the people of Los Osos, but also to the people of SLO County, and California, and, frankly, all of the United States, and that's why I think it should be a local media business that foots the bill for that report (as opposed to, you know, little ol' me. I mean, do I look like a have New Times-type money? ; -)

[By the way, speaking of businesses and money: Are we all in the wrong business, or what? I mean, $150 bucks for a copy of a three page report? Good lord. If I were to sell copies of my reports at $50-bucks/page, I'd be a thousandaire by now.

And, as long as we're having some fun here, I also want to quickly point out an interesting, and funny, fact: Notice how the "suspended" rating is... uh, was?... "BBB-".

For municipal bonds -- that were issued by a local municipality -- I find that rating hilarious.

Notice how they are not "AAA" rated bonds.

Nope.

Not even "BBB."

Nope.

But, "BBB"-friggin-"minus"... the absolute lowest "investment grade" bond rating S&P offers.

And, to continue the hilarity, if you want to get a fun sense of what a "B" bond rating means, especially when it comes to things like over-the-top shady Los Osos CSD, I highly recommend (re)watching the excellent movie, The Big Short, and pay close attention to what "Margot Robbie in a bubble bath" has to say about B-rated bonds. HIGHlarious.]

So, yeah, a detailed report -- that, hopefully, shows exactly why S&P was recently forced to suspend their "BBB-" rating for the nearly $18 million worth of bonds sold by the Los Osos CSD in 2002 to partially fund their now-failed "mid town" sewer-"park" disaster -- a disastrous non-"project," that will never exist, yet "more than 4,000" Los Osos property owners are now stuck funding on their property taxes until the year 2033/34, as I first exposed at this link:


... really sounds like it could be worth the $150 investment for the local media.

The story is spectacular.

Again, just a quick favor: If one (or all) of you, would please purchase a copy of that report, and post it on your web site(s), I would really appreciate it, and, I'm sure that the people that invested in the bonds would also VERY much appreciate it.

If you have any questions, please just ask.

Thank you,
Ron

Oh, and P.S: As usual, this email posted to my blog, SewerWatch, at this link:


Thanks again.

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sewerwatch.blogspot.com

Thursday, July 28, 2016

Los Osos CSD bonds information IS hard to get

TO: Kaiti Wang, S&P Global Ratings credit analyst

Hello Kaiti,

I'm a blogger in San Luis Obispo County, and I'm researching a story on the Los Osos Community Services District, and I recently read a press release from S&P Global Ratings, at this link:


... where it reads:

"Los Osos Community Services District Wastewater Assessment District No. 1, CA Rating Suspended On Lack Of Information
SAN FRANCISCO (S&P Global Ratings) June 21, 2016--S&P Global Ratings has suspended its 'BBB-' underlying rating (SPUR) on Los Osos Community Services District Wastewater Assessment District No. 1, Calif.'s series 2002 limited obligation improvement bonds. At the same time, S&P Global Ratings has removed the rating from CreditWatch with negative implications. 'This action follows repeated attempts by S&P Global Ratings to obtain timely information of satisfactory quality to maintain our rating on the securities in accordance with our applicable criteria and policies,' said S&P Global Ratings credit analyst Kaiti Wang."

Now, I'm sorry to have to bother you with this inquiry, but, in your press release, you are SO right when you write, "This action follows repeated attempts by S&P Global Ratings to obtain timely information of satisfactory quality," because, about two weeks ago, I emailed the LOCSD's General Manager, Peter Kampa, asking him about what's happening with the bonds, and why S&P Global Ratings is having so much trouble getting "timely information of satisfactory quality" regarding those extremely important bonds, but, of course, Mr. Kampa never replied (to me, as well), so, yes, I can now understand why your company was forced to "suspended its 'BBB-' underlying rating... on Los Osos Community Services District Wastewater Assessment District No. 1, Calif.'s series 2002 limited obligation improvement bonds," because, apparently, prying any information out of the LOCSD regarding those over-the-top important bonds is seemingly impossible.

You can read my full email to the LOCSD GM -- including information on what makes those bonds intensely newsworthy today (and until the year 2033/34) -- on my blog, at this link:


So, that's why I now have to apologize to you, for bothering you on information regarding the LOCSD's secretive bonds, but that agency just simply won't reply, despite the fact that they write on their web site:

"District Transparency
As a local goverment [sic] agency, this Los Osos Community Services District has a responsibility to remain transparent to the public. We are held accountable by our community."

Uh, not so much.

So, now, considering that LOCSD officials refuse to answer my questions, despite their highly hypocritical (and spell-check challenged ; -) statements on their web site, I'm hoping that you could answer just a couple of quick questions I have involving the state of the "Los Osos Community Services District Wastewater Assessment District No. 1, Calif.'s series 2002 limited obligation improvement bonds."

For example, I'm not exactly an expert on municipal bonds, so, when you write, "S&P Global Ratings has suspended its 'BBB-' underlying rating (SPUR) on Los Osos Community Services District Wastewater Assessment District No. 1, Calif.'s series 2002 limited obligation improvement bonds," I'm not quite clear on what that means.

For example, I'm not clear on how suspending the "BBB- underlying rating" impacts the bonds. Can the bonds still be sold/purchased/etc. on the "secondary market" (I believe it's called) when the bonds' "underlying rating" is "suspended?"

Any information you could supply me with on the impact "suspending the "BBB- underlying rating" has on those bonds, I would very much appreciate.

Also, your press release is dated June 21, 2016, and it's now July 28, 2016. In the time since your press release was released, have you been able to "obtain timely information of satisfactory quality to maintain our rating on the securities," or is that still a problem?

Again, I apologize for having to bother you with my questions, but, as we both know now, it is very difficult to "obtain timely information of satisfactory quality" from the LOCSD, despite what their highly hypocritical and less-than-truthful web site states.

If you have any questions, please just ask (and, unlike the Los Osos CSD, I will reply in a "timely" fashion : -)

Thank you,
Ron

P.S: This email posted to my blog, SewerWatch, at this link:


Thanks again.

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sewerwatch.blogspot.com