Valley Water CEO Resigns Amid Misconduct Probe, Transition Plan Set

The resignation of Rick Callender as Chief Executive Officer of the Santa Clara Valley Water District (Valley Water) marks a turbulent chapter for one of Northern California's most critical infrastructure agencies. The departure, effective immediately following a misconduct investigation, highlights the intensifying scrutiny on executive behavior within public utilities and the complex legal maneuvers often employed to manage high-level exits. While the specific nature of the misconduct has not been fully detailed in the initial announcements, the board’s decision to move toward a separation agreement suggests a desire to mitigate further legal exposure while maintaining a semblance of operational continuity.

Leadership transitions in the public sector, particularly those triggered by internal investigations, present unique challenges for HR and workforce management. For Valley Water, which serves approximately two million residents in Santa Clara County, the CEO is not merely an administrator but a political and strategic figurehead responsible for multi-billion dollar infrastructure projects and complex environmental regulations. Callender’s move to an advisory role for one year is a strategic, albeit often criticized, component of executive separation. This soft exit allows the organization to retain institutional knowledge during the search for a successor, but it frequently draws fire from taxpayers and internal staff who may view it as a lack of accountability for the alleged misconduct.

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The resignation of Rick Callender as Chief Executive Officer of the Santa Clara Valley Water District (Valley Water) marks a turbulent chapter for one of Northern California's most critical infrastructure agencies.

From a workforce perspective, the immediate impact will be felt in the agency’s internal culture and morale. Misconduct investigations at the highest level of an organization often lead to a wait-and-see atmosphere among mid-level management and front-line employees. HR leaders at Valley Water will now face the daunting task of maintaining productivity and employee engagement while the board initiates a nationwide search for a new leader. The precedent set by this resignation—and the terms of the separation—will likely influence future governance policies within the district, particularly regarding how complaints against senior executives are handled and the transparency of the resulting investigations.

The broader market trend in public agency governance shows an increasing intolerance for executive misconduct, fueled by heightened transparency requirements and a shift in societal expectations. Competitors and peer agencies, such as the East Bay Municipal Utility District or the San Francisco Public Utilities Commission, will likely observe this transition closely. Historically, such high-profile departures lead to a period of reputational repair, where the incoming leadership must prioritize ethics and cultural reform alongside technical operations. The use of a one-year advisory contract is a mechanism designed to bridge this gap, but its effectiveness depends heavily on the degree of separation between the former CEO and the daily decision-making processes.

Looking ahead, the Santa Clara Valley Water District board must navigate the dual pressures of maintaining water security in a climate-volatile region and restoring public trust. The search for a permanent CEO will be a litmus test for the agency’s commitment to a new era of leadership. Industry analysts expect the board to prioritize candidates with strong backgrounds in both technical utility management and organizational ethics. In the interim, the focus will remain on the details of the separation agreement and whether the findings of the misconduct investigation will eventually be made public, potentially triggering further legal or regulatory scrutiny. For HR professionals, this case serves as a reminder of the critical importance of robust executive oversight and the complexities of offboarding high-ranking officials under a cloud of controversy.