Water panel looks to shore up finances

The embattled DuPage Water Commission made moves Thursday to put its recent financial missteps behind it and begin enacting a series of recommended safeguards to keep similar mismanagement from happening in the future.

A specially commissioned forensic audit recently revealed the agency misspent its $69 million reserve fund because of "intentional misconduct and gross negligence" by former financial administrator Max Richter and poor oversight by former General Manager Bob Martin and the 13-member commission.

The commission ratified Martin's separation agreement and began talks of instituting new methods of controlling its finances and accounting data at Thursday's meeting.

Martin will receive six months' pay amounting to $93,500, a payout of nearly $30,000 for eight weeks of unused vacation time, and full medical and dental coverage for a year. The decision did not come without some squabbling, though.

Commissioner Jim Zay complained about having to pay Martin anything to resign, calling it a "golden parachute." But the commission was told Martin's open-ended contract called for such a deal and it would be upheld by the courts if the commission refused to pay.

Initially, Martin's severance package also included almost $40,000 more for more than 10 weeks of vacation he apparently never used. But the commission removed that particular payout. The vote was unanimous.

Talk turned to a special committee report on structural and procedural changes recommended in the audit. The report outlines plans to implement 21 recommendations that auditors believe will provide more financial security and accountability.

The report also suggests a timeline for the commission to go about replacing Martin and Richter. The proposed timetable would have a new general manager in place by August and a financial administrator hired in December. The committee's report also calls for the commission's financial information to be placed on the agency's Web site.

The water commission provides Lake Michigan water to more than two dozen municipalities and agencies, including slivers of unincorporated parts of the county. Funding comes from the sale of water to the municipalities plus a quarter-cent sales tax.

Hundreds of thousands of dollars are being spent to rectify the commission's financial crisis, which has required the agency to take out a $30 million loan to cover some debt and shore up its reserves. The commission is also talking about taking out another $40 million loan to cover the remainder of its debt. The forensic audit cost the commission more than $360,000.

The commission meets again Thursday, April 15, to discuss the coming year's budget.