Sent a note to the DWR folks... Here is the reply. Looks like they hope to have it fixed shortly.
I am the Hydrographer in charge of the BOCPINCO (South Boulder Creek near Pinecliffe) station. Since the station was re-opened this spring, the encoder we use has experienced some problems. I noticed the problem a couple weeks ago and attempted to fix the encoder. The shaft was not moving smoothly allowing it to register proper gage height, I cleaned it and thought I had success but it is back to a flat line again. I now have a replacement encoder that is scheduled to be installed tomorrow morning. We should be up and running by the weekend.
If you have any further questions, feel free to respond to me directly.