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State puts hold on future Agua SUD projects

*Editor’s note: an earlier version of this story misidentified Ricardo Ochoa as managing partner of CSJ Group when Eddie Saenz in the managing partner. The story has been corrected and we apologize for the error.


Citing concerns about “management issues” at the Agua Special Utility District a state agency has put a hold on funding its future projects. But despite the concerns, utility officials say already planned sewer and water projects continue moving forward.


The action by the Texas Water Development Board follows a Dec. 13 meeting between TWDB staff and Agua SUD board members, contractors and attorneys at the utility’s Palmview headquarters. During the meeting utility officials were informed the TWDB “would not be authorizing additional projects or committing future funds to Agua SUD until their management issues are addressed,” said TWDB spokeswoman, Kimberly Leggett.


At issue is the allegation the latest in a series of interim managers and executive directors, Richard LeFevre, hired in late September, is no longer fulfilling his duties with the utility.


In an interview Tuesday, LeFevre, an engineer and president of the McAllen-based firm, LeFevre Engineering & Management Consulting, LLC, and who serves as city engineer for Palmview, Mercedes and Donna, confirmed he was stepping back from his duties due to a health issue diagnosed in early November.


“I actually had to step back from my business because of my condition,” LeFevre said in a telephone interview after Democratic State Sen. Juan “Chuy” Hinojosa released a copy of a letter he sent Tuesday to Agua SUD Board of Directors President Rogelio Hernandez III. The letter reiterates the decision to block approval and funding for future projects and requested a plan of action be developed immediately to address concerns for the $45 million in projects the TWDB has already invested including the $41 million Palmview wastewater project.


Hinojosa stated its clear LeFevre “is not carrying out his responsibilities” and notes LeFevre hired his company’s vice president, Emigdio “Milo” Salinas, without board approval and has paid Salinas $18,000 of taxpayer funds without any approval.   


During a Nov. 27 board of directors meeting board member, Ricardo Ochoa, questioned Salinas’ appointment as “interim assistant general manager” saying until Salinas made a presentation to the board that night he was not aware of the appointment and questioned its legality. However utility attorney, Frank Garza, said the board had given the general manager the authority when it created the position in September. The position was created at the same time the board abolished the executive director position after Oscar Cancino resigned as interim executive director after serving since Oct. 2016.


“The water development board knew, they were kept informed” about Salinas’ hiring, LeFevre said.


On Tuesday, LeFevre said he has not been collecting a salary from the utility and defended hiring Salinas saying the money paid the interim assistant manager was for 178 hours of work performed between Sept. 25 and Dec. 4. LeFevre said during those two months Salinas, working with utility engineer, Eddie Saenz and Garza, had renegotiated deals with contractors that saved the utility nearly $1 million. LeFevre said it was necessary to renegotiate the contracts because they were originally negotiated at least 10 years ago and that inflation has reduced their value. And LeFevre said even though he has not been personally involved, Salinas and utility staff have kept the installation of sewer lines in Palmview moving and have negotiated more than half of the 19 property acquisitions needed to begin construction of four lift stations for the project.


During his two months in charge LeFevre said Salinas found the utility has purchased 500 acre feet of water, or about two million gallons, from the Texas Commission of Environmental Quality that has not been converted, or received from the Rio Grande River, that once utilized could result in reduced customer water costs.


“I’ve voted many times for Mr. Hinojosa and I love him to death,” LeFevre said. “The senator is entitled to his opinion and I don’t have any problem with that opinion. But I can tell you that the district and the board is doing everything it can to proceed forward.”


Saenz, the utility’s engineer, agreed projects were moving forward despite the absence of a full time general manager. He said there have been several applications filed for the position that closes on Dec. 27. Saenz said he has been running the day-to-day operations of the utility in consultation with Salinas and Garza.


At its Dec. 12 meeting the board approved a 30.6 million budget for FY 2018 that begins Jan. 1. The budget contains $5.6 million in drinking water projects and $25 million in sewer projects. The projected budget also includes an end of year surplus of over $233,000 if all projects continue as planned, said the utility’s chief accountant, Dagoberto Soto Jr.


A slightly less surplus in this year’s budget allowed the board to approve one time bonuses for the utility’s 68 full time employees of $400 and its one half-time employee of $200 costing the utility less than $30,000.

As for an action plan board member Ochoa said if he had his way the board would immediately appoint Saenz as the assistant general manager while the search for a permanent general manager continues. Saenz is managing partner of CSJ Group, an Edinburg-based civil engineer and construction firm. Saenz said he has been putting in 20 to 24 hours a week overseeing the utility and is considered by Ochoa as the defacto interim assistant manager. Asked if he would accept such an appointment Saenz declined to comment.


LeFevre said despite insinuations to the contrary the utility has strategic plans in place and only lacks a permanent general manager which he contends is just a matter of time.


“It’s a good system,” LeFevre said. “And the employees, good employees. I mean just honest, hard working people. And I know the district is trying and it can be a great system if they get the right general manager. It’s going to be a great system.”


Neither Board President Hernandez or the utility’s attorney, Frank Garza, responded to requests for comment by press time.

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