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East Palo Alto officials say city takeover stabilized sanitary district after fraud, operational gaps
Summary
East Palo Alto officials told San Mateo County LAFCO the city's Oct. 1, 2024 reorganization of the East Palo Alto Sanitary District has improved governance, restored financial controls after a $500,000 fraudulent check, standardized operations and begun a capital improvement program; the commission heard follow-up questions about rates and developer will-serve processes.
Melvin Gaines, East Palo Alto city manager and the city's appointed general manager of the East Palo Alto Sanitary District (EPASD), told the San Mateo County Local Agency Formation Commission (LAFCO) on Jan. 21 that the city's takeover of the district has produced "stability and governance, service delivery, financial controls, regulatory compliance, and long term infrastructure planning."
Gaines said LAFCO unanimously approved the reorganization on Nov. 15, 2024 and the change became effective Oct. 1, 2024. He told commissioners the city found several operational gaps after assuming control, including missing financial controls and inconsistent permitting. "We actually…
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