Water district CEO departure prompts big payout

Last month, Santa Clara Valley Water District board members announced that CEO Beau Goldie would be stepping down from the top position of the South Bay’s regional water agency. But the so-called resignation came with the kind of hefty paycheck normally associated with an involuntary termination.

Goldie received a payout that included six months of his salary, or $152,630, as well as $84,093 for accumulated vacation time and $35,222 for sick time. His total severance package added up to about $278,100.

Although board president Barbara Keegan announced on Jan. 14 that Goldie was resigning and retiring, his contract states that he would be entitled to six months of pay only for termination without cause. In other words, the board had to fire Goldie for him to be entitled to the payout.

It turns out that there’s a clause included in Goldie’s original CEO contract from 2009 that states that he can choose to resign after the board decides to fire him in closed session. Goldie would be able to retain the severance package by going this route, according to the contract.

Keegan said the board carefully followed the requirements laid out in Goldie’s original contract, and awarded him a severance package consistent with what they had to give him.

The board had a series of closed-session meetings over several months discussing the CEO’s performance, following a number of controversies involving Goldie’s leadership last year. Emails written by district staff and published by San Jose Inside last year raised red flags that the water district may have been charged by a contractor for work that had not been performed.

The outside contractor in question, RMC Water and Environment, had billed the district for $350,000 for work that was not performed on a project it was hired to do several years ago, according to the email. The concerns prompted an investigation by the Santa Clara County District Attorney’s office over fraud allegations last year.

Despite these concerns, Goldie continued to authorize contracts with RMC, including a $1.3 million sole-source contract with the company last year.

Board member Gary Kremen said he was “deeply disturbed” that Goldie continued to work with RMC, and that he was happy the board stuck with a severance package that gave him only what he was guaranteed in his contract. But he said it was a deceptive to the public that the contract allowed Goldie to “resign” even if he was ousted by the board.

“I think it’s ridiculous,” Kremen said. “If I was there in 2009, I wouldn’t have agreed to it.”

The board is in the process of hiring an interim CEO and, eventually, a new CEO to replace Goldie. Kremen, who represents Mountain View on the board, said he did not want the new contract to include the same language that allows the CEO to resign after termination, even if it has become commonplace.