Publication Date: Friday, July 15, 2005
Ulrich conflict may be overstated
Ulrich conflict may be overstated
(July 15, 2005) City Attorney may have provided incorrect information to D.A.
by Jay Thorwaldson
Utilities Director John Ulrich's "direct" involvement in negotiations with PG&E may be overstated.
A district attorney investigation has been launched into whether Ulrich violated state conflict-of-interest and Political Reform Act laws because he owns $6,000 worth of PG&E stock -- fewer than 160 shares at today's stock value -- relating to the 25 years he worked for PG&E. He joined the city as utilities director in 1999.
In a letter to the district attorney, City Attorney Gary Baum wrote that Ulrich "directly participated" in discussions regarding PG&E contracts with the city. The letter, which triggered the D.A.'s investigation, was disclosed to the Weekly Wednesday by William Larsen, special assistant district attorney.
The letter stated that Palo Alto has millions of dollars of contracts with PG&E, and that the city also held discussions regarding the 2001 PG&E bankruptcy proceedings.
However, Baum may have been mistaken about Ulrich's involvement with PG&E negotiations. Larsen stated Thursday that the city attorney left a message regarding a possible mistake, although the exact details of this error had yet to be confirmed.
At press time, Larsen said he would get back in touch with Baum.
According to City Councilman Bern Beecham, the city does contract directly with PG&E on a major natural gas contract, but terms of the agreement predated Ulrich's arrival to the city. Palo Alto has a separate contract with the Western Area Power Administration (WAPA), a consortium of municipal and public power agencies through which the city contracts with PG&E.
It was through this organization that Palo Alto responded to the PG&E bankruptcy. Beecham said Ulrich was involved in shaping the city's response in both contract and bankruptcy proceedings, working through WAPA.
Since the potential conflict was made public, Larsen has repeatedly emphasized that the investigation is in its earliest stages and no facts have been verified.
Baum said Ulrich voluntarily disclosed his ownership of the stock during a separate, intensive six-month investigation into alleged "moonlighting," timecard violations and supervision problems in the city Utilities Department.
The separate probe into Ulrich occurred after the utility director disclosed his ownership of PG&E stock last spring, which he told other city officials had slipped his mind. He had not declared the ownership at the time he was hired nor in recent annual "form 700" disclosure statements required of all high-level public officials.
A source within the Utilities Department told the Weekly that several of the 19 employees disciplined in the six-month "moonlighting" investigation were punished for failing to file form 700, and there was a "flurry of activity" relating to such forms last March -- about the time Ulrich disclosed his PG&E stock. The 700 form requires disclosure of stocks, investments and outside work that might be a conflict of interest.
Baum told the Weekly he became concerned about possible conflict of interest and called Karen Sinunu, a deputy district attorney who specializes in that field of law.
Baum said he asked if the amount involved met the minimum standard for action by the office.
"She said to write a letter, which I did," Baum said.
Beecham, the city's point person on energy matters and its official representative to the Northern California Power Agency (NCPA), defended Ulrich Wednesday afternoon.
"I have worked with John since I came on the council and I continue to have confidence in his strong sense of ethics," Beecham said.
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