The temporary head of Silicon Valley’s largest water agency is facing questions over a potential conflict of interest as she oversees a contract with her husband’s consulting firm.
Melanie Richardson, a former deputy administrator and assistant CEO at Santa Clara Valley Water, has come out of a recent retirement to lead the water agency as it investigates a workplace misconduct complaint against her former boss, Valley Water CEO Rick Callender. Richardson is serving until Callender’s expected return in April and receiving $227.79 an hour. That equates to an annual base pay of $473,000, roughly what Richardson made before retirement in 2024 when factoring in benefits, according to Transparent California. She is still receiving a $23,333 monthly CalPERS pension.
Richardson will oversee the $964 million water resources system, including a $15 million contract with RMC Water and Environment — her husband Tom Richardson’s engineering consulting firm — for design services on the Upper Llagas Creek Flood Protection Project. Valley Water awarded RMC the contact on May 11, 2010 and it has an expiration date of Dec. 31, 2025.
Melanie Richardson told San José Spotlight her husband has retired, but still does part-time consulting for the firm. But Melanie Richardson herself held between $100,000 and $1 million in RMC stock, a privately-held company, while she was one of Valley Water’s highest paid employees, according to past financial disclosures. She didn’t say whether she still holds stock in the company when asked by San José Spotlight, and has yet to file her state-required Form 700 which reports her income and assets. She has 30 days to do so from her Feb. 3 start date.
The consulting firm’s work spurred intense scrutiny — and a district attorney investigation — in 2015 over improper payments, fraudulent billing and for winning million-dollar Valley Water contracts that were fast-tracked without a competitive bidding process, according to reporting by San Jose Inside a decade ago. Multiple news outlets that year reported RMC received a total of $18 million in contracts over the preceding decade.
RMC was later acquired by a larger environmental consulting firm known as Woodward & Curran in 2016. The firm was also caught in a bribery scandal in Monterey County, where a water board official was criminally charged for accepting $160,000 in illegal payments from the firm.
After Melanie Richardson’s ties to RMC became public in 2015, Valley Water executives insisted there was a “firewall” that kept her removed from decisions involving RMC and subsequently Woodard & Curran. She stated publicly that she was not part of any communications — formal and informal — relating to RMC and that she did everything she could to avoid true or perceived conflicts.
Melanie Richardson said she will abide by the firewall and recuse herself from business involving the firm.
“I have been 100% compliant. Upon my return to Valley Water this month, the restrictions remain in place for my new position,” Richardson told San José Spotlight.
Valley Water spokesperson Matt Keller said an independent investigation was completed in 2015 regarding conflict of interest, policy violations and potential misconduct into Melanie Richardson’s relationship with RMC Water and Environment. Keller said the investigation found there was no evidence of bias.
Her return raises alarms for at least one board director, Rebecca Eisenberg.
“I continue to have significant concerns with this issue and have brought this to the board’s attention numerous times, even before Ms. Richardson was being considered by the board to serve as interim CEO,” Eisenberg told San José Spotlight. “I believe that RMC is still receiving ratepayer and taxpayer funds through projects determined by Valley Water.”
Last August, the board of directors pulled $51 million from the Upper Guadalupe River Flood Protection Project — listed as a priority under a clean water measure approved by voters in 2020 — to cover shortfalls in the Upper Llagas Creek project that RMC designed.
Other board directors have no concerns about Melanie Richardson’s business ties.
“There is no conflict. Her husband retired,” Director Richard Santos told San José Spotlight.
Santos didn’t see Melanie Richardson’s Form 700 during her hiring process, but said it was presumably cleared by the clerk and board for her appointment.
“We’re worried about flooding, drinking water for the future, building dams, all the earthquake issues. Melanie Richardson brings that expertise that we need at this time,” Santos said.
Contact Brandon Pho at [email protected] or @brandonphooo on X.
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