Water District Manager Drowning in a Tsunami of His Own Making

Posted on May 12, 2022

Dennis Falaschi, the general manager of the Panoche Water District in central California, was indicted for conspiracy, theft of government property, and filing false tax returns.

In 1992, Falaschi discovered that an abandoned drain turnout on the Delta-Mendota Canal that had been sealed years earlier was leaking water. He instructed an employee to install a new gate inside the standpipe so that the site could be opened and closed on demand. While his superiors thought the old turnout was sealed and not functioning,  Falaschi proceeded to sell 25 million dollars’ worth of federally owned water over a period of 23 years. A drought in 2015 caused water levels to recede and the site was discovered.

Falaschi used the proceeds from the illegal water sales to pay himself and his co-conspirators exorbitant salaries, fringe benefits and personal expense reimbursements. From 2015 to 2017 he failed to report to the IRS the more than $900,000 in income he received from private water sales.

If convicted, Falaschi faces a maximum of 23 years in prison and fines up to $750,000.

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