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ESTATE FAIL, PAPER CUTS

ESTATE FAIL

A lawsuit alleging corruption and conflict of interest has been filed against Terry Vierra, a former board member of the San Lorenzo Valley Water District (SLVWD). The suit claims Vierra and his wife, Molly Bischoff, received illegal financial gain—more than $13,000 in real estate sale commissions—from the district while Vierra sat on the board, and that this conflict of interest was hidden from both other board members and the public.

Back in 2010, the water district purchased a lot with a house on it in Boulder Creek, with the intention of adjusting lot lines and building water tanks on the $524,000 property. The trouble is, according to plaintiff Bruce Holloway, Bischoff was the listing agent for the property representing the district as the buyer. Both Vierra and Bischoff are realtors for Century 21 Showcase Realty Agents, Inc. of Boulder Creek. The suit claims that no other board members, or the district’s attorney, Marc Hynes, seemed to know about this conflict of interest.

Holloway, a water district customer since 1982, became concerned about the district following water rate increases in 2010—about the same time the district acquired the property in question. He started attending board meetings regularly.

Hynes says the lawsuit is without merit because there are exceptions to the law governing conflicts of interest for public officials that allow this sort of contract. Hynes, who’s representing both Vierra and the board, says the district did know about Vierra’s ties to the property. He says he advised board members at the time that “there was nothing to worry about” as the board considered the purchase.

SLVWD was investigated last year by the Santa Cruz County Civil Grand Jury, which found a number of “irregularities” going back many years—including unexplained losses in the district’s investment portfolio; operating without an approved budget for almost the entire 2013-2014 fiscal year; and numerous Brown Act violations.

Following the Grand Jury’s report, longtime District Manager Jim Mueller was fired. Two longtime board members, Vierra and Jim Rapoza, chose not to run for re-election last November. A third, Larry Prather, was the election’s lowest vote getter. Newcomers were elected to the three open seats.

A hearing is scheduled for Sept. 15, in Santa Cruz County Superior Court.  PATRICK DWIRE

PAPER CUTS

As the fate of the nation’s second-largest newspaper company hung in the balance, so too did the fate of the Santa Cruz Sentinel, the San Jose Mercury News and the Monterey County Herald. Apollo Capital Management was rumored to be interested in a $400-million purchase of Digital First Media, which includes the Sentinel and other papers. That sale has fallen through, either because Apollo got cold feet—deciding the price was too high—or because fellow private equity firm Alden Capital, DFM’s current owner, found its offer too low.

“At this point, they essentially are not actively looking to sell the company, but that doesn’t mean there won’t be sales,” says media reporter Ken Doctor, who writes for Nieman Journalism Lab and lives in Aptos.

Meanwhile, there continues to be staff shake-up locally, the latest being Jason Hoppin, the former Sentinel and Herald reporter who’s started a communications job for Santa Cruz County that starts at $89,000 per year. JACOB PIERCE

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