MOORLACH UPDATE — Responding — March 26, 2013

A CEO search is not for the faint of heart, as the dynamics on both sides of the equation play important roles. The last CEO search, some ten years ago, took a lengthy period of time as well. For me, when a door closes, a window opens. So it’s onward and forward with the process, as we encourage our interims to hold down the fort. The Voice of OC opines on the current status in the first piece below. I would have to state that the report about my position in closed session did not come from me and it is not as accurate as the writer infers. But, regarding closed session dialog, I can neither confirm nor deny.

The second Voice of OC piece covers media styles. Every elected official has their own style of dealing with the media and addressing tragic events. Fortunately, major traumatic events do not occur that often, so no one is ever fully prepared with a thorough checklist of bases to cover. This was a rather peculiar story line an awkward one to respond to, as I prefer an unpretentious approach.

The last piece is from the Newport Beach – Corona del Mar Patch and covers a decision about priorities for the city’s Chamber of Commerce.

Temps Still Running County After Wallar Deal Collapses

By NORBERTO SANTANA JR.

With talks collapsing last week to have Santa Barbara CEO Chandra Wallar take the reigns in Orange County, supervisors continue to preside over a county bureaucracy largely in interim hands.

Supervisors have been trying to appoint a CEO since August and have yet to fill key positions such as the county clerk-recorder, auditor-controller and public administrator. Supervisors are still trying to find an executive to manage the county’s large real estate portfolio, among other key appointed slots that are vacant.

With three of the five supervisors eyeing higher elected offices, many of the decisions are being viewed through a political lens. The result is a testy search process.

Public deliberations between board members are increasingly becoming uncomfortable, such as recent exchanges over culling candidates for clerk-recorder and negotiations over Wallar’s salary and pension contributions.

Wallar ended talks last week, citing leaks to Voice of OC and calling out supervisors for changing terms after the two sides had privately agreed to a deal.

In a letter that supervisors released last week, Wallar criticized the board for holding “open session discussions of compensation after deal points were negotiated." Members of the board, meanwhile, said that revisions to the state’s open meetings law passed in the wake of the city of Bell scandal required that top salaries be negotiated in public.

Furthermore, they insist that they never authorized any deal points for their negotiating subcommittee, composed of Supervisors Pat Bates and Janet Nguyen.

“Maybe she misunderstood that the [subcommittee] could only offer a tentative offer,” Supervisor John Moorlach said last week after Wallar notified the board that she was bowing out.

Both Moorlach and board Chairman Shawn Nelson insisted in closed-session discussions that they would not pay more than the $262,000 total compensation package they had paid to former CEO Tom Mauk.

Mauk resigned in August in the wake of the sex scandal involving Carlos Bustamante, former county Public Works executive and Santa Ana city councilman.

Wallar’s deal unraveled over whether she would be compensated for having to pay her employee share of pension payments. Wallar contended that she privately negotiated a salary of $300,000, which she said is in line with other Southern California counties.

“The salary and benefit package deal points that have been negotiated with you, as the Board’s subcommittee, are completely in line with total compensation received by CEOs in similarly sized California counties," Wallar wrote in her letter. "In fact, in some cases other counties are compensating their CEOs substantially more, and as you reported during the April 19th Board meeting, the median for your survey market is approximately $300,000.”

Bates and Nguyen initially supported Wallar’s demands. Last week, however, they insisted they were only presenting Wallar’s salary demands.

Supervisor Todd Spitzer, who supported Wallar’s appointment but not her salary demands, lamented the situation, saying board members had erred by not having a public discussion about salary earlier.

Spitzer said that the board "should have been much clearer and had the discussion about compensation out in open when they designed the recruitment flyer.”

Given the debate in public over her salary, Spitzer acknowledged that “I can’t blame her for being offended.”

The public debate also revealed an important downside to Wallar, Spitzer said,

He said that when Wallar wouldn’t agree to a compromise salary of $270,000, it became clear that “she wouldn’t be a good fit for Orange County.”

The big sticking point on the CEO salary — just as with most recent labor deals with employees — is having all employees pay their portions of their annual pension payments.

County supervisors themselves spent much of last year unable to reach an agreement on numerous proposals put forth by Nelson that would have reduced the pension benefit of members of the board.

Earlier this month, supervisors imposed a deal on county attorneys that required employee pension payments. The attorneys have filed suit, arguing that supervisors violated the law by imposing such terms.

Managers were also forced to pay into their pensions in a deal imposed by an outside mediator.

Spitzer said Wallar’s refusal to negotiate on picking up her own pension payments showed she was not the right fit. He said he was “dissapointed that she doesn’t seem to understand the OC standard and what we expect.”

Spitzer said: “She doesn’t understand we’re not going to have a double standard for our CEO as we do for our employees. … We’re not going to treat our CEO any differently than our rank and file.”

Wallar was apparently the second casualty on the CEO search related to pension issues.

The board’s first choice, San Diego Chief Operating Officer Jay Goldstone, lost the job after he submitted papers for retirement to San Diego County, violating the board’s second mandate: no double dippers. According to sources close to the negotiations, board members were adamant about not want to be seen as contributing to pension abuses by hiring a top executive who was drawing a large pension from another jurisdiction.

Late last week, Moorlach said that given Wallar’s problems, “I’m ready to look at No. 3 now,” referring to county Human Resources Director Steve Danley, who was among the finalists.

It’s unclear, however, where the search process goes from here, except that it is becoming increasingly likely that Interim CEO Bob Franz’s tenure will reach the one-year mark.

Please contact Norberto Santana Jr. directly at nsantana and follow him on Twitter: twitter.com/norbertosanana.

It’s Easy for Electeds to Misstep in Their Response to Tragedy

By ADAM ELMAHREK

Like so many across the country distraught by the shooting massacre that left 20 children dead at a Connecticut elementary school last December, Anaheim realtor Meghan Shigo felt a need to mourn and heal with her community.

Shigo’s grief led her to email to members of the Anaheim City Council with a request for a candlelight vigil. Upon receiving Shigo’s email, Anaheim Mayor Tom Tait’s staff quickly went to work and, with the mayor’s blessing, organized a vigil that was to take place just days before Christmas.

However, while Tait’s office coordinated with city staff and local religious leaders to make it happen, the news release inviting the public to the event came only from the mayor and made no mention of city staff or other members of City Council. This did not sit well with Kris Murray, seen as the leader of the Council majority and a bitter rival of Tait’s.

“Not including the Council and city staff was appalling. How could you?” Councilwoman Kris Murray wrote in an email to Deputy City Manager Greg Garcia. “I’ve asked [City Manager Bob Wingenroth] to take it down and rewrite including mayor, council and staff. Whoever is acting CM [city manager] tonight, I would like a call to discuss and a timeline when it will be written appropriately. I will be waiting for a call on my cell.”

While Tait did not return a phone call regarding the controversy, Shigo and others believe that the exclusion of other members of Council in the news release was more likely the result of an oversight than an attempt by the mayor to make political hay.

Regardless, it is a cautionary tale of the delicate politics surrounding tragic events and how an elected official’s emotional reaction can come back to haunt them. And it’s not the only instance of such controversy in recent months.

“When we get emotional, this is what happens,” said Steve Alexander, president of The Steve Alexander Group, a strategic communications firm. “Most anger is to cover up for hurt.”

Another example came when Irvine Mayor Steven Choi appeared at a news conference last month announcing a multi-agency, $1 million reward for tips leading to the capture of Christopher Dorner, a former Los Angeles police officer who went on a killing spree targeting police officers and their families that began with the murder of an Irvine couple.

The problem was that Choi had not gotten City Council approval to commit the $100,000 in city funds, much less appear at public event to show Irvine’s support for the reward.

Choi’s colleague, Councilwoman Beth Krom, said that she first learned about a possible commitment and Choi’s plan to attend the news conference in the same way everyone else did, by watching it on television.

“When the mayor is speaking on something it presupposes that you have the support of this body,” Krom said.

After the news conference, confusion set in about whether Irvine officials committed the money without council approval.

An Orange County Register article quoted an official in Los Angeles Mayor Antonio Villaraigosa’s office as saying that Irvine was on a list of agencies that had pledged funds toward the reward.

Yet at a council meeting earlier this month, Choi denied prematurely committing the funds. And Choi said that he only got a two-hour notice before the event from the city manager, who Choi said suggested the mayor attend.

“As Mayor of Irvine, I should have been there, how could I not be present?” Choi said.

Republican Councilwoman Christina Shea – a Choi ally on the council – defended the mayor’s appearance at the news conference as appropriate for a directly elected mayor. “You have that right, the voters voted you in, and you need to support our community,” she said.

The skirmishes in both the Anaheim and Irvine examples could be little more than examples of how opposing council blocs will argue about anything, even reactions to tragedies.

Murray is part of an Anaheim council-majority that has slashed compensation for the mayor’s council-aide, a move widely seen as retribution for Tait’s numerous attempts to undo a controversial $158-million tax subsidy for a local hotelier that helped finance the campaigns of the council-majority.

And Krom is part of a two-member, Democratic Irvine council-minority that has resisted Choi and a Republican council-majority’s moves to, among other actions, change the power structure of the governing board at the Orange County Great Park.

By comparison, county Supervisor Todd Spitzer’s drive to San Bernardino to be on scene during the Dorner manhunt didn’t elicit public outrage from his board colleagues.

“So many people thanked me for my words at the time,” Spitzer explained. “Mine was to go into the community and offer words of concern at a time of high anxiety regarding Dorner’s apprehension.”

Spitzer added that he spoke only for himself and that the murder of Dorner’s first victims happened in his supervisorial district.

Supervisor John Moorlach said that his own style of dealing with reporters couldn’t be more different than Spitzer’s. But Moorlach doesn’t hold it against him.

“I’m the polar opposite,” of Spitzer, Moorlach said. “I actually make the media my top priority when they call. I call you right back. But if you were a camera crew, I wouldn’t run up to you.”

Alexander says that people shouldn’t be too harsh on elected officials for their actions after tragedies occur. It is difficult to judge motivations in highly emotional situations, Alexander said.

“In the midst of a tragedy, it’s hard to think rationally or collectively,” Alexander said. The question to be asked of the politician, Alexander said, is “were his goals good?”

Shigo shares at least some of Alexander’s sentiment.

“There was no ill intent,” Shigo said. “I really think that everybody was operating with a lot of things going on,” including “mourning and disbelief.”

As for Murray’s reaction, Shigo noted that Murray has a son approximately the same age as the Sandyhook school victims, making the tragedy “an intense moment” for the councilwoman.

For Shigo, the council-spat is in the rear-view mirror. And politics is the last thing she wants to consider when reflecting on the shootings.

“That’s the most horrific tragedy we’ve had as a nation, very horrible,” Shigo said. “So who cares about that other stuff?”

Please contact Adam Elmahrek directly at aelmahrek and follow him on Twitter: twitter.com/adamelmahrek.

Chamber Nixes Taste of Newport

Although it was a popular event, preparations for the Taste of Newport resulted in the Newport Beach Chamber of Commerce neglecting its 670 members, officials said.

· By Nisha Gutierrez-Jaime

It’s attracted tens of thousands of food lovers to Newport Beach, but the Taste of Newport isn’t on the city’s menu this year.

For the past 24 years, the Newport Beach Chamber of Commerce has hosted the annual foodie event, but on Monday chamber officials said they could no longer expend resources on the event. Steve Rosansky, the chamber’s president and CEO, said the Taste of Newport drained the chamber’s manpower and took staff away from serving the business needs of its 670 members.

"Literally, we would be starting now to work on putting the Taste of Newport on in September," Rosansky said. "The last few months before the event all the chamber staff would be working on that event alone. There is no staff time or energy left to do things for the members."

Rosansky said the choice to end the Taste of Newport was a "programming decision" that will allow the chamber to refocus on providing more value to its members.

Staff is now working on revamping the chamber’s Government Affairs meetings. In the past the same 10-12 people would attend the meeting, but in February about 60 people showed up, Rosansky said. At the April 4 meeting, Supervisor John Moorlach will be speaking, which may not have happened if the Taste of Newport was still in the works, he added.

"If we were focusing on the Taste of Newport, we may not have had the manpower to find speakers or make the meetings a success," Rosansky explained.

The chamber is also using its time to form another meeting for its members that will revolve around business issues including current tax laws and what the Affordable Healthcare Act or Obamacare means to Newport Beach businesses.

Other chamber restructuring efforts include replanning the Fireman’s Appreciation Barbecue, which was held in October because Taste of Newport was in September.

"Without Taste of Newport we are now moving the barbecue to September, which makes more sense because we got rained on last year," Rosansky said.

The future of the Taste of Newport is still up in the air.

Rosansky said it may return one day and might be at a new venue, or it could be scaled down or hosted by other organizations.

"Things have just gotten a little stale, maybe the Taste of Newport needs a kick in the pants and will return with some changes," Rosansky said. "At the chamber we are just trying to do things a little differently and be more proactive to what is happening in our business community."

FIVE-YEAR LOOK BACKS

March 26

2003

OC Register “Red Ink” columnist Peter Larsen addressed a couple of questions from readers on the state’s finances in “One sure thing: State can’t turn to sports betting for help,” which addressed the first question. In June of 2001, the State of California had unrestricted net assets of $7 billion. Two years later, the unrestricted net assets under Governor Gray Davis had plummeted to an unrestricted net deficit of $44 billion – an unprecedented $51 billion swing in twenty-four months. No wonder the OC Register had a “Red Ink” columnist and that Davis would be recalled a year later, in 2004. Here is the second question and answer, which starts with a fun jab that is even funnier today:

Q: I’m interested in the perspective of our county treasurer, John Moorlach – because he went through this before – to figure out what was what, so we weren’t hit so hard by the bankruptcy.

A: If he were king – or governor, at least – Moorlach says he’d focus on five categories to tackle the deficit.

Can expenses be cut? Should revenues be raised? Is it prudent to borrow money to cover debts? Are there excess assets to sell? And is there anyone to sue?

Moorlach said the state increased its spending rapidly and now should make deep cuts. Taxes should not be raised by bonds might need to be sold to cover the deficit, he said.

He’s most adamant that the state needs to be more conservative with its money in good years so it can better weather the bad.

When capital-gains taxes climb again – as they did during the tech boom – the state should spend the extra money to pay off bonds sold to cover the deficit, he said.

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