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D.A. Files Charges Against Wallace

The SLO County District Attorney’s Office on Jan. 24 filed a felony complaint against San Luis Obispo businessman, John Lee Wallace in connection with his past role at a sanitation district in South County.
A statement drafted by Assistant District Attorney, Lee Cunningham, said that, “after conducting a ten month investigation,” they filed the a felony criminal complaint, “for violations of conflict of interest laws while he was the District Administrator of the South San Luis Obispo County Sanitation District (SSLOCSD).”
Further, the complaint alleges that between July 26, 2011 and Feb. 28, 2013, Wallace, as district administrator, “made, participated in, or influenced governmental decisions and made contracts in which he had a financial interest. Specifically, Wallace is charged with two felony counts of violating Government Code Section 1090 and two misdemeanor counts of violating Government Code Section 87100.”
The statement added that Wallace’s arraignment on the charges was anticipated within two weeks of the announcement but Cunningham could not provide an update as of press time.

A statement released by Wallace’s attorney, Dennis D. Law with the San Luis Obispo-based firm Andre, Morris & Buttery, reads, “John Wallace served the South San Luis Obispo County Sanitation District for more than 27 years, always with direct board and legal approval and in plain view of the public and regulators. He is dismayed by the unprecedented action and confident the facts of the case will clear the air.”
District Attorney Dan Dow said in a news release, “The public has the right to expect that their elected and appointed officials and their administrators will carry out their duties in a lawful, ethical and professional manner. The District Attorney’s Public Integrity Division will thoroughly and fairly review all matters referred to us and will pursue charges such as these whenever appropriate.”
Cunningham said the D.A. began its investigation in March 2016, after receiving, “formal referral of a 629-page report [including exhibits] titled, ‘Review of Past Management Practices’ from the South San Luis Obispo County Sanitation District authored by Carl Knudson of Knudson & Associates.”
The so-called Knudson Report concluded that Wallace may have committed criminal malfeasance and that, “[b]ecause potential violations of law are investigated and processed by law enforcement officials, we suggest that this report be provided to law enforcement officials for their determination.”
The District Board had voted unanimously to refer the Knudson Report to the District Attorney on Jan. 20, 2016.
The District provides sanitation service to about 37,000 people residing in Oceano, Grover Beach and Arroyo Grande. The board is comprised of a representative from both cities and the Oceano CSD.
This latest development is the product of six years of public scrutiny of the managment of the District which began after a 2010 sewage spill, the largest in their processing plant’s history. The Regional Water Quality Control Board determined that the district was at fault due to improper maintenance, equipment failure and lack of protection in the event of a 100-year storm and fined the sanitation district $1.1 million.
– Camas Frank

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