MOORLACH UPDATE — HB Independent — January 7, 2010

To make a long story long, in 2006 I participated in assisting the County to create a first-tier piece of short-term paper (rated A-1, P-1 and F-1) that I could purchase as the County Treasurer.  The County sold the investment to the Orange County Investment Pool, which used the proceeds to prepay their annual pension plan contribution to the Orange County Employees Retirement System (OCERS).  For the prepayment, OCERS provided a 7.75 percent discount.  This resulted in a significant savings to the County. 

My predecessors on the Board of Supervisors decided to take the savings and give each Board office $1 million, which was deposited into Fund 130 for use in upgrading parks within their districts. 

One of the few grants I distributed, before we decided to put the balance in the County’s General Fund due to the budget squeezes we have been facing, was to the Bolsa Chica Conservancy toward a footbridge running parallel to Warner Avenue, just north of Pacific Coast Highway.

Tuesday’s OC Register had a short article stating that the bridge was to arrive that day.  So, on my way into the office I enjoyed a drive north up PCH to the Bolsa Chica Conservancy Interpretive Center to see the project.  A volunteer for the Center stated she was there since the early morning hours, but no bridge.

Before departing, I walked out to the site of the bridge and met Kelly O’Reilly, with the California Department of Fish and Game, who informed me that she had just learned that the truck had been delayed in delivering the shipment due to the need of a permit from CalTrans (oversize load concerns).

So, on my way into the office I contacted Cindy Quon’s office.  Ms. Quon is the Caltrans Director for District 12 and serves with me on the Orange County Transportation Authority (OCTA) Board of Directors.  “Cindy, we’ve got some wonderful people waiting to see their new bridge. What can we do to assist?”

Thank you, Cindy Quon, for jumping on this matter!  You’re wonderful.


New bridge coming in soon

State official says Caltrans permit has come through and walkway should arrive from Arizona by Tuesday.

By Michael Miller

A pedestrian bridge that will connect the Bolsa Chica Mesa to the parking lot by Warner Avenue is expected to arrive early next week and be installed Wednesday.

The 145-foot bridge, which was paid for by the state, the Bolsa Chica Land Trust and other environmental groups, was scheduled to be delivered this week, but the California Wildlife Conservation Board was unable to secure a permit from the California Department of Transportation to transport the bridge from Arizona to California.

Now, the permit has come through and the bridge could be delivered as early as Monday, project manager Bonnie Turner said. She expected the installation to take place Wednesday, although it may be several days until the bridge is open to the public.

“We’re hoping that there will be no further delays, because we’ve waited a long time for this bridge,” Turner said. “The whole grant process started in May 2004, and it’s taken this long to get it to this stage. Right now, it’s sitting in Coolidge, Ariz., waiting to be delivered, and we’re really excited about it.”

Turner said the overall cost of the bridge, including construction work, state permits and other expenses, would likely exceed $500,000. The board hopes to host a grand opening ceremony before the end of February.

Flossie Horgan, Land Trust executive director, and Grace Adams, Bolsa Chica Conservancy executive director, said the project was a tribute to different groups, and to individual citizens, working together.

“It’s been a long time coming, but it really is a tribute to the community responding,” Horgan said.

The bridge will provide an easy walkway to pedestrians at Bolsa Chica, who currently have to walk alongside traffic on Warner to make it from the parking lot to the mesa. After the installation, Adams said, the conservancy plans to resurface the parking lot and add a decomposed granite trail and native vegetation leading to the foot of the bridge.

Adams noted that Orange County Sup. John Moorlach had played a major part in resolving the bridge’s permitting issues. She added that while Bolsa Chica’s three main environmental groups — hers, the Land Trust and the Amigos de Bolsa Chica — have not always seen eye to eye, they were able to join together on the bridge project.

“I think there’s joint recognition by the three groups that public safety is of prime importance,” she said. “The safe passage of visitors coming to the reserve is critical.”


January 7


The Coaster Magazine had an untitled column that introduced me and my recommendations on the financial travails facing the county.  In looking back, here are some thoughts.   I still lament that El Toro was annexed over to the city of Irvine.  Since I wasn’t selected immediately to serve as Treasurer and the consultants that were hired had already liquidated the portfolio, there was no rush to take the job.  And marking municipal portfolios to market would become the law of the land with the issuance of GASB 31 (I still call it “my GASB” pronouncement).

In May of 1994, while campaigning against County Treasurer Robert Citron, [Moorlach] sent a 3,600-word letter to County Supervisor Thomas Riley (with copies to the other four supervisors and both of the county’s daily newspapers).  The letter detailed that if interest rates continued to rise, Citron’s investment pool, with a highly leveraged $22 billion of 187 county municipalities’ moneys, “will develop a negative cash flow and implode.”  Interest rates did rise; the fund did implode and on December 6th, Orange County and the pool declared bankruptcy.  Moorlach feels there is a way out of the county’s dilemma, “but it will be very painful.”  His comments follow:

“It’s rehabilitation time,” declares John Moorlach, “and for individuals, corporations or a county, that means 1) raise revenues, 2) Cut costs, and 3) Sell assets.”  Although it’s too early to pinpoint what should be done to increase revenues, Moorlach applauds recent county budget cuts and is willing to discuss what assets could be sold.  “Selling John Wayne Airport should definitely be considered; I understand a Japanese firm is already interested.”  But another concept he feels worth exploring involves MCAS El Toro.  “The military will eventually deed it to the county, and through emergency action it could be made available for purchase as open space by South County residents via an assessment district,” Moorlach proposes.  Again, the proceeds of the transaction would eventually go to pool participants.

Would John Moorlach, who ran for County Treasurer, like that role in the county’s rehabilitation?  “I would,” he quickly answers, “and there are indications it will be offered.”  His only qualification would be not assuming the treasurer’s duties until after the April 15th tax filing deadline.  “As a CPA, I have responsibilities to my clients that can’t be ignored,” he says.  But he states a first step would be “to initiate an investment pool Oversight Committee comprised mostly of local business people.”  Moorlach feels the advisors currently in place are talented but, he observes, “they’re outsiders.  That’s what got us into this jam in the first place, brokers from New York and San Francisco.”  His solution to the current crisis would utilize successful Orange County investment bankers.  “Local brokers would care deeply about the end results of their actions,” Moorlach says.  “They’d have a social as well as a business involvement.”

“And right away,” declares Moorlach regarding his assuming the post of County treasurer, “I’d mark to market.”  This means that instead of valuing bonds at what they’ll be worth years in the future, as Citron did, Moorlach would mark them according to current market conditions.  As to making major governmental changes, the young Republican activist recognizes the limitations of the antiquated Orange County political structure.  “The system is stacked against progress; over time it has to be changed.”  What does John Moorlach see in Orange County’s future?  “A lot of changes,” he thoughtfully predicts, “but this is a resilient area and change will be for the better.  But it’s going to be painful for a while.”

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