MOORLACH UPDATE — Voice of OC — August 10, 2011

Yesterday’s Board of Supervisors meeting ran past 5:00 p.m.  The agenda was very demanding.  The Voice of OC articles below cover two of the many topics that were discussed during our eight-hour-plus session.

Without going into personal details, I will tell you that I have received quite an education on mental illness these last five years.  I have met with concerned parents about a variety of programs that can be offered.  The County has allocated a significant amount of Proposition 63 funds towards new mental health care services.  As I mentioned during the public comments section of our meeting yesterday, I cannot recall having one person ask me to consider implementing “Laura’s Law” until opening an e-mail on the subject late Monday evening.  I mentioned this during the public comments section of our meeting.  My observation was not meant as an admonishment, rather it was an expression of bewilderment that in my prior meetings and discussions there had not been a strong vocal request to have “Laura’s Law” implemented in Orange County.  I even asked Health Care Agency Deputy Director Mark Refowitz, who has been with me in at least one of these meetings, as to why it had not been brought to the Board before now.  He mentioned that it had not and volunteered to have the necessary backup in order for the Board to make an informed decision within 30 days.

With regard to the County’s Performance Audit Department report on our Human Resources Department, I just want you to know that we are hot under the collar about the findings.  I just found myself becoming a little more animated than usual when the item was discussed.


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Families of Mentally Ill Question Supervisors in Wake of Police Beating Death

The beating death of Kelly Thomas by Fullerton Police has forced a renewed focus on homelessness and mental health outreach among Orange County supervisors.

On Tuesday, more than two-dozen relatives of people facing mental illnesses such as schizophrenia, which is what Thomas suffered from. They challenged supervisors to better tap into statewide mental health funds — through Prop 63 – and get services to the mentally ill living on the streets.

Supervisors also asked staff to continue to investigate providing a year-round homeless shelter in Orange County.

Family members spent the entire day at the meeting, commenting on mental health and waiting till nearly 5 p.m. to call on supervisors to enact Laura’s Law — a 2002 measure that makes it easier for families to get help with forced treatment for their relatives with severe mental illnesses.

Thomas’s father, Ron Thomas, has said that his son’s homelessness stemmed from his inability to stay on his medication.

Supervisors reacted to the calls from advocates Tuesday by asking health care agency officials to prepare a report within 30 days on how to implement Laura’s law in Orange County.

Only two counties in California — Los Angeles and Nevada — have implemented Laura’s Law. OC officials will spend the next month studying how those counties have implemented the program, said Health Care Agency Deputy Director Mark Refowitz.

Supervisor John Moorlach went so far as to ask family members of mentally ill people why it had taken them so long to show up. Moorlach said he had never heard about Laura’s Law in his five years on the board.

Family members noted that dealing with mental illness is not always easy and given societal stigmas, they haven’t felt comfortable coming out. One woman told Moorlach that both sides — families and elected officials — have each been living in their own bubbles.

Some officials also told supervisors that the combination of budget cuts in recent years along with the difficult nature of mental health outreach has made it tough.

"A lot of the services we should be providing have been diminished," Refowitz said.



County’s Top Executive Pay to be Reviewed

Orange County government’s highest paid executives will spend the next month scrambling to cobble together documentation to defend a series of lucrative raises they and others received in recent years.

Yet it’s uncertain whether the generous raises – one example being more than 30 percent in one year for Deputy CEO Rob Richardson – will actually be rolled back.

The Board of Supervisors Tuesday voted unanimously for the review based on a recommendation by supervisors Pat Bates and Shawn Nelson. Bates and Nelson made the recommendation after reviewing a scathing report issued earlier this year by the county Performance Auditor Steve Danley that criticized lax procedures in the county’s Human Resources Department for justifying and documenting raises.

Danley and CEO Tom Mauk have squared off over the report with Mauk staunchly defending the raises for his executive team and questioning some of the audit’s conclusions about improper justification for the raises. Bates and Nelson spent the last few months looking at the dispute.

On Tuesday, supervisors backed Danley on every disputed item. Mauk, in turn, didn’t fight their conclusions, saying he would back full implementation of their suggestions.

"I’m not a big fan of it, but it’s not a sword I want to fall on," Mauk said from the dais about placing top executives on temporary promotion status while the documentation for their raises is prepared.

While most supervisors didn’t say much about the salary increases revealed in the audit – the result of a bureaucratic and seemingly automatic system of salary hikes known as reclassifications – Supervisor John Moorlach lashed out at the executive ranks over the raises.

"I think some of these raises were nuts," Moorlach said. "I’m ready to blow up.”  Moorlach later chided his colleagues saying, "everyone is being so polite."

Bates struck a diplomatic tone saying the classifications where "things we have to be more cognizant of."

"We see the shortcomings and we’re stepping up to the plate," Bates said.

Supervisors also want a full briefing on how to implement another suggestion by the auditor that the county hire a third-party negotiator to deal with labor negotiations. And they want a closer hand in knowing what’s going on inside the department.

Yet it seems that Human Resources Director Carl Crown still has a ways to go in terms of keeping supervisors informed. At Tuesday’s meeting, when Mauk told supervisors that a senior HR official was retiring, they reacted with surprise.

"When am I getting a memo?" asked Moorlach.



August 10


The Long Beach Press-Telegram had a barn-burner of an editorial.  The writer was nice to pay me a kind compliment in a commentary that addressed my favorite subject in “Enron-by-the-Sea – San Diego’s awful audit leaves it looking for ways to pay its pension bills.”

The all-but-bankrupt city of San Diego has earned the comparison with such financial failures as Enron, WorldCom and Orange County, according to Arthur Levitt Jr., and he ought to know. He is the former chairman of the Security and Exchange Commission and a respected figure in the field of finance.

Levitt also headed a months-long investigation by Kroll Inc., a New York risk management firm that issued its findings Tuesday. The bottom line: San Diego city officials for many years recklessly mismanaged finances; they owe taxpayers the truth about a bloated and underfunded pension system, and they must face up to the fact the city needs more revenue (tax increases, in other words).

The Kroll report said city officials deliberately broke the law, disregarded fiscal responsibility, disregarded the financial welfare of residents and, oh by the way, cheated residents on their monthly sewage fees to benefit large industrial users.

You might expect that would be enough to get some politicians in trouble, and it was. The mayor resigned, along with several other officials, and a federal grand jury has indicted five city pension board members for approving a pension mess that now is sinking the city.

After the scandal become evident, San Diego voters approved a strong-mayor form of government to centralize authority and responsibility. But, the Kroll report says, the city still can’t handle such basic functions as bank reconciliations, and long-range budget planning is nonexistent.

Nobody has come close to figuring out what to do about the $2 billion difference between the costs of San Diego’s extravagant new pension plan and what the city can afford to pay. The new mayor, Jerry Sanders, has been pretty good with the platitudes, but his only specific commitments have been: no more borrowing to cover up the problem, and no new taxes no matter what. That doesn’t leave much room for solutions.

The Kroll report clearly didn’t buy the argument of San Diego’s city attorney, Michael Aguirre, who argued that since the procedure for granting the big pension increases was illegal, it ought to be legal to simply roll them back. Levitt called Aguirre a demagogue, which seems about right.

San Diego evidently has a long way to go before things get better. So does Orange County, and the reference to its financial problems was timely. The county still is recuperating from a bankruptcy triggered by $1.7 billion in debt, which is beginning to look almost small compared to the current $3.7 billion deficit caused by swollen county employee pensions and retiree medical benefits.

Nobody in Orange County government has figured out what to do about its deficit either, although the county’s wisest critic, Treasurer and Supervisor-elect John M.W. Moorlach, told the L.A. Times something has to give and "everything is on the table." That’s at least promising.

Should taxpayers outside San Diego and Orange County give a whit about these political and financial disasters? Yes, because politicians’ giveaways have created serious underfunding of pensions in state government and in many local entities.

The city of Long Beach is quick to point out that it has no unfunded pension liabilities (though growing retiree medical costs are a separate issue). And its pension enhancements aren’t without cost.

After the stock market took a nose dive in 2001, Long Beach had to resume pension-fund payments at the rate of more than $30 million a year, 25 percent of which is caused by enrichment of employees’ pension benefits.

At some point, voters will either have to wake up and elect more public officials like Orange County’s Moorlach, or accept increased taxes or decreased services, or both.

That, plus the possibility of joining the ranks of Enron, WorldCom, San Diego and Orange County, are more than enough of a wake-up call.

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