Silicon Valley’s leading drinking-water provider, which collects millions of dollars from the public to provide clean water, is under investigation for violating state water-pollution laws after repeatedly spilling hydraulic oil into its reservoirs.

Prosecutors from the Santa Clara County District Attorney’s Office have notified the Santa Clara Valley Water District that the agency is facing fines of up to $25,000 in connection with the most recent spill, in early January at Coyote Reservoir.

“Due to the serious nature of the violations and the potential impact on the environment, the District Attorney’s Office has decided that a civil prosecution is appropriate in this case, with the goals being threefold — punishment, deterrence and compliance,” deputy district attorney Tina Nunes Ober wrote in a March 29 letter to water district CEO Beau Goldie.

The district, a government agency based in San Jose, is the primary water wholesaler for Santa Clara County. It provides drinking water and flood protection to 1.8 million people.

Sensitive time

The looming civil prosecution comes at a particularly sensitive time for the agency, which is preparing a November ballot measure asking voters to renew a $52-per-year parcel tax to continue for another 15 years water-quality programs and flood control work under its Clean, Safe Creeks program.

The water district’s legal problems began Jan. 12, with a 20-gallon spill that day at Coyote Reservoir. State Fish and Game Warden Tyson Quintal wrote the district a citation.

Quintal had warned district officials less than two months earlier, after a 5-gallon spill at Lexington Reservoir on Nov. 29, that the agency had a chronic problem and that unless it stopped the pollution, he would turn the case over for prosecution.

Water district officials said the spills have been minimal and the result of mechanical failures in often-aging hydraulic systems that open and close the valves to let water out of dams into streams. No fish died, they said, and tests at water treatment plants didn’t show elevated levels of petroleum products in drinking water.

“Every once in a while this does happen,” said Frank Maitski, a deputy operating officer who supervises dams at the district. “These are fairly small spills, and there are billions of gallons in the reservoirs. We’ve never seen any environmental damage at all.”

Repairing the leaky hydraulic systems, which can cost $5 million or more at each reservoir, will be done methodically over the next decade as the district does seismic upgrades at many of its 10 dams around Santa Clara County, water district officials said.

The hydraulic repair work won’t be done sooner, they said, because it would require draining most of the water out of each reservoir — and they don’t want to drain them twice.

“People understand the big picture,” said water board Chairwoman Linda LeZotte. “We are going to monitor and keep an eye on this. If there is an easy fix to be done, we’ll look at it. But it makes no sense to spend millions of dollars to replace old equipment when we are going to be retrofitting the dams for seismic safety anyway.”

District records show that since 2001, the water district has had eight spills of hydraulic oil — ranging in size from 5 gallons to 35 gallons — at six of the 10 reservoirs it operates: Almaden, Calero, Coyote, Guadalupe, Lexington and Stevens Creek.

Environmentalists say while the spills are small, there have been too many.

“I think they are just making excuses,” said Roger Castillo, executive director of the Salmon and Steelhead Restoration Group, a San Jose nonprofit.

“It’s ironic. Their job is to keep our water system clean,” Castillo said. “But they are saying we’ll take care of it later. It’s an injustice for the agency that keeps asking us for more money.”

Herman Garcia, who runs a nonprofit creek restoration group in Gilroy called CHEER, agreed.

“I have to wonder how our tax dollars and water fees are being spent,” Garcia said. “Why isn’t this equipment upgraded or maintained? What is all the money being spent on?”

Raising rates

On Tuesday, the water district board voted to raise water rates by 9 percent.

The agency, which holds $267 million in financial reserves, has raised $293 million in parcel taxes under its original Clean, Safe Creeks program, approved by county voters in 2000. But that money was committed in ballot language to maintaining flood channels, building hiking trails and cleaning pollution from streams — not replacing aging dam equipment.

Yen Dang, supervising deputy district attorney for the office’s environmental unit, said prosecutors were contacted by the state Department of Fish and Game about the pollution. The office has not filed a civil case in court, Dang said, adding that while her office is reviewing the matter, it would have no additional comment.

In her letter March 29, however, prosecutor Nunes Ober suggested that the water district “arrive at a mutually satisfactory resolution to the case,” which would be filed in court as a judgment with a complaint.

Water district officials said the product that spilled is “Chevron Clarity,” a mineral oil that partially biodegrades within 28 days. The fluid “is considered a hazardous waste because of its hydrocarbon content,” the district wrote in a maintenance report this year.

The district could have faced criminal prosecution for failing to report the Jan. 12 spill immediately, as state law requires. But prosecutors said in their letter that because it was small — and cleaned up — they would pursue only civil penalties.

Paul Rogers covers resources and environmental issues. Contact him at 408-920-5045.