MOORLACH UPDATE — FPPC Investigation — June 19, 2013

When I first started working at the County, the Grand Jury was a revered institution. But, over the past eighteen years, the work product has been dismal and disappointing. Every year, I wonder if the new Grand Jury will step up to the role and provide value in their reports on County government. Sadly, they don’t. If you were to review the Grand Jury’s reports over the last ten years, and score them based on how many recommendations were appreciated and adopted, the results would be disheartening. Consequently, I voted for a Performance Audit Department that would really research and investigate policy, practices and conduct within the County and provide meaningful recommendations for improvements. I also support a robust Internal Audit function to make sure internal controls are the best that they can be. If there are critical issues that need to be addressed, I rely on these two departments to discover, report on, and make recommendations to remedy them. It has become abundantly clear that the Grand Jury has not been a reliable resource in its investigations or observations. Today’s articles deal with this topic.

The Board addressed Grand Jury remuneration, which is $15 per day by State statute, plus mileage to get to the courthouse every morning. Orange County has been paying $50 per day, plus mileage. It was worth taking the time to reevaluate this compensation arrangement. It was also an opportunity to share how some of us really felt. The first article below from the OC Register fails to mention that I opposed the response to the Grand Jury’s “CalOptima” report. The report, for the most part, is factually accurate. It was the report’s title that was inappropriate. The workmanship of the “Ethical” report is shoddy, as the arguments do not support the conclusion. And the title is irresponsible and offensive. So, I shared my frustrations. The Grand Jury has to step up its game. Maybe it should focus on producing 4 well-researched and beneficial studies rather than 15 marginal reports. Maybe it needs to reevaluate the diversity of its membership. Maybe it needs an “ethics committee” to give the Grand Jury the perspective of “what would a wise person do” before publishing a report.

It seems that I read about various city council members being arrested in LA County each month in the LA Times. I don’t see that pattern here in the OC. But, after a few inflammatory Grand Jury reports and the inference that as a Board member I am corrupt, I then receive a letter from the Fair Political Practices Commission. Trust me, you don’t want to receive a letter from the FPPC. That’s how incompetent and negligent this Grand Jury and its foreman have been. One observer called this year’s Grand Jury an “epic failure.” That’s too bad, because I’m sure the members are all fine people. But, they lacked leadership. Let’s hope that the 2013-14 Grand Jury can bring some momentum to move the bar up. The Voice of OC provides its take on the Board meeting and the FPPC in the second piece below.

Supervisors lambast grand jurors but don’t cut their pay


After months of trading criticisms and rebukes, members of the county’s Board of Supervisors and its grand jury faced off Tuesday in a rare public showdown.

Supervisors expressed deep disappointment with the quality and tone of the grand jury’s reports while tabling a proposal to cut jurors’ pay by 70 percent.

Ray Garcia, foreman of the grand jury, acknowledged "we have some issues with certain reports," but said "there’s a certain degree of insult" in Supervisor Todd Spitzer’s proposal to slash jurors’ stipends from $50 a day to $15.

Spitzer’s proposal, which would save a couple of hundred thousand dollars in the county’s $5.4 billion annual budget, was "obviously not" aimed at fiscal savings, Garcia said.

Incoming grand juror Michael Anzis, who will be sworn in July 1, said a cut in the stipend would be "a breach of faith" and would prompt him to consider resigning. "It does appear to me as retribution," he said.

The grand jury consists of 19 county residents, often retirees, who serve together for 12 months starting in July of each year. It is empowered to bring criminal indictments and conduct civil investigations of county and city governments.

The 2012-2013 grand jury, now in its final weeks of service, has so far released nine reports based on civil investigations. Two of those, in particular, raised the ire of supervisors: "CalOptima Burns While Majority of Supervisors Fiddle," released in January; and "A Call for Ethical Standards: Corruption in Orange County," released in April.

Regarding CalOptima, the public health plan for the poor that serves one in three children in Orange County, the supervisors on Tuesday named Spitzer to serve as an alternate to Supervisor Janet Nguyen on CalOptima’s board.

The grand jury’s report said CalOptima "appears to be imploding," citing the departures of 16 senior executives within 18 months after Nguyen joined its board. The jury recommended that more than one supervisor serve on CalOptima’s board, and that county staff members be removed from the board. The supervisors rejected both of those recommendations.

Shawn Nelson, chairman of the Board of Supervisors, tongue-lashed the grand jury as several jury members sat in the room.

The grand jury’s investigation of CalOptima was "shameful" and "a complete disservice," in that it failed to interview Nguyen and its report was "devoid of any information" about the effect of the executive departures on service levels, Nelson said.

"What, if anything, was the significance of all those people leaving?" Nelson asked. That’s "the blank that was never filled in," he added.

Supervisor John Moorlach said he was "very disappointed" with what he said was the grand jury’s "shoddy workmanship."

"When you have an umpire who makes a bad call, it ruins the game," he said. "It demoralizes the players. All I’m asking for is an umpire that calls balls and strikes right."

"When we got a report calling us corrupt," Moorlach said, he later received a letter from the state’s Fair Political Practices Commission saying he was under scrutiny. The letter cited the grand jury’s report on corruption and apparently went to all five supervisors, he said.

The corruption report, which drew on scandals dating back to the 1970s, cited comparisons between Orange County’s government and notorious patronage machines such as New York’s Tammany Hall or Chicago under Mayor Richard J. Daley.

"It is the grand jury’s hypothesis that untoward behavior continues and is actively festering in today’s political environment," the report said, adding that "corruption has permeated all levels of the organization." However, the report was light on specific allegations of present-day corruption.

The supervisors agreed to hold off on any changes to jurors’ stipends, pending further study.

Contact the writer: agalvin

OC Supervisors, CalOptima Under FPPC Investigation


The state’s Fair Political Practices Commission confirmed Tuesday that the agency is investigating a majority of Orange County supervisors along with the CalOptima board of directors for potential conflict of interest violations of the Political Reform Act, based on the findings of two Orange County Grand Jury reports filed earlier this year alleging corruption at the highest levels of county government.

The revelation about the FPPC probe spilled out from an emotional public meeting Tuesday where all five county supervisors lashed out publicly at Orange County grand jurors accusing them of using irresponsible headlines to cover badly focused probes that had now triggered state reviews.

Current, former and future grand jurors, in turn, showed up at the public podium, steadfastly defending the integrity of their reports and volunteer efforts. District Attorney Tony Rackauckas also defended the efforts of grand jurors.

At one point during Tuesday’s meeting, Supervisor John Moorlach angrily stared grand jurors down – as supervisors debated a motion brought by Supervisor Todd Spitzer to slash future panelists individual stipends from $50 a day down to $15. Last month, supervisors rejected a request from the grand jury for $20,000 in supplemental spending.

Orange County’s Superior Court budgeted $209,000 for the grand jury this year, with $180,000 of that going to salaries and benefits and $29,000 spent on services and supplies.

Grand Jury Foreman Ray Garcia, who defended the legitimacy of his panels’ previous reports, told supervisors that the two final grand jury reports of his term would land this morning.

Orange County grand jurors first attracted the ire of county supervisors in January when they issued their first report of the year, evocatively titled, “CalOptima burns while majority of supervisors fiddle.”

That report questioned fundraising connections between hospital lobbyists, County Supervisor Janet Nguyen and a county ordinance adoption that increased hospital influence on the governing board of CalOptima – the county’s managed health care plan that covers more than 400,000 poor and elderly residents.

In April, the panel followed with “A Call for Ethical Standards: Corruption in Orange County.” It gave a recap of corruption cases stretching back as far as the 1970s and urged the formation of an ethics commission, such as used in Los Angeles or San Diego.

Apparently, the day after that report landed, the state’s political watchdog kicked into gear, launching investigations into county supervisors – except County Supervisor Todd Spitzer who was not on the board during the ordinance change – along with many of the board members that Nguyen moved onto the CalOptima board of directors.

“We opened the investigation based on the Orange County report,” said Gary Winuk, chief of the Enforcement Division for the FPPC late Tuesday.

“We are investigating violations of the Political Reform Act based on the findings of the grand jury,” Winuk said adding that, “we were made aware of it through the District Attorney’s office.”

District Attorney Chief of Staff Susan Kang Schroeder declined comment.

Not much is known beyond that, other than the probe is expected to take 18-24 months, Winuk said, and does involve the use of subpoena authority to interview witnesses, signaling that it is more than just a routine audit of campaign accounts.

Supervisors likely began receiving letters from the FPPC in early May – about the time Spitzer suggested rejecting the grand jury supplemental funding request.

The probe also seems to have already triggered a change at CalOptima board meetings. In the past year, CalOptima board members rarely declared a conflict or abstained on issues.

But in May, there were two abstentions among the 10 board members and the June 6 meeting saw an unusual flurry of board members abstaining and even leaving the room because of conflict concerns.

When the board was discussing contracts with health networks, four of the 10 board members at one point abstained. On another item that covered rate payments to providers, Nguyen abstained and two other board members, Samara Cardenas and Viet Van Dang, left the room.

Peter Agarwal abstained on a third issue involving teleworking and use of the CalOptima building.

The grand jury institution is rooted in the state constitution and every county is required to impanel one each fiscal year, which is why they are typically sworn in early July.

Along with working with local prosecutors, the panel – typically made up of nearly two-dozen retirees – is required to also look into issues of good governance, a civilian watchdog of sorts with limited public funding. Public agencies are required to publicly respond to its criticisms.

That’s where it gets tricky.

Elected officials often complain that the panel lacks diversity or recruitment standards and can often go off the mark because it rarely has the resources, expertise or staff to effectively analyze local government in real time.

“I’ve been very disappointed with the work product of the grand jury for years,” said Moorlach from the dais Tuesday. “I wish I would get a grand jury that got it and gave something of value.”

Moorlach was visibility irritated on Tuesday as he discussed the panel’s report on an ethics panel saying that “calling us corrupt” was “unbelievable.”

“Then I get a letter from the FPPC because our grand jury issued a report, therefore I must be doing something wrong and I’m under investigation.” added Moorlach, who ironically voted against the CalOptima ordinance change sought by Nguyen and the Hospital Association of Southern California.

“I love baseball, and I love to go to baseball games, and I love watching baseball. But boy when there’s an umpire that makes a bad call, it ruins the game. It demoralizes the players. It disturbs the fans. All I’m asking for is umpires that call balls and strikes right. They don’t over-embellish, they’re not arrogant about who or what they are. And they should be respected. But respect is earned," Moorlach said.

“I want so badly to just be excited about the grand jury and their work project. But inflammatory titles, shoddy workmanship – that isn’t fair to the grand jury, that isn’t fair to the Board of Supervisors, it isn’t fair to the employees of this county, it isn’t fair to the taxpayers."

Moorlach ultimately also voted against many of the county’s responses to the grand jury report. Supervisors also delayed any action to reduce grand jury stipends opting instead for a Spitzer proposal to have staff study the grand jury process in Orange County and report back periodically.

Despite the ultimate delay in action, consideration of the stipend issue allowed supervisors to public vent at grand jurors with each one hitting the panel from a different direction, even though they all insisted that the two issues were not connected.

Supervisors’ Chairman Shawn Nelson slammed the panel on the CalOptima report saying he supported keeping the stipend at the state rate of $15 daily.

“I’m not sent any extra budget for grand jury service,” Nelson said.

Nguyen also slammed the group…for slamming her. And for not granting her requests to be interviewed. She also repeated her allegation that the grand jury made factual mistakes in its report.

“I have never had to do a press conference to show you the evidence that was public record…you were so wrong,” Nguyen said.

She also took issue with the lack of comment from the panel about her opposition to lucrative bonuses granted to top executives just as CalOptima was raising copays on vulnerable groups.

Spitzer took aim at the panel saying it should consider a higher threshold for issuing reports saying, “I think there should be a probable cause requirement for issuing a civil report.”

He discussed how frustrated he was by the grand jury’s report on corruption in Orange County saying about Foreman Garcia, “I wrote him two letters on that report, the corruption report. I wrote seven pages of notes.”

Nelson at one point admonished Spitzer to avoid talking publicly about grand jury proceedings given their protected confidentiality status.

Bates later suggested that grand jurors needed more training and were being overly influenced by local blogs she declined to identify by name.

“My discomfort with the reports, was the matter in which the evidence was reviewed,” Bates said.

Supervisors were met with significant opposition in their bid to penalize grand jurors by cutting back stipends.

“If you do this, you’re un-American,” said Westminster resident Darryl Nolta, who noted that he also saw the holes in the CalOptima report that grand jurors penned.

However, Nolta reminded supervisors, “it was a fundamentally important document because it shook you up.”


June 19


Hugh Hewitt wrote “The Orange County Baron Flies Again – Marty Baron would be a fine choice to replace Howell Raines at the New York Times. He learned long ago that sometimes conservatives can be trusted” for the Weekly Standard. Marty Baron was the editor of the LA Times when I ran against Robert Citron. Marty Baron missed the concerns I was raising. Hugh Hewitt decided to use it in his piece, as Marty Baron had disappointed him in the past, as well.

NEWSWEEK’S media reporter Seth Mnookin handicapped the race for the job of New York Times executive editor last week, putting Los Angeles Times managing editor Dean Baquet as the 2-1 favorite, Bill Keller (runner-up to Howell Raines in the last go-round) in the second position at 3-1, and Boston Globe editor Marty Baron as a reasonable 5-1 shot.

Baquet has widespread respect within the newsroom of the west coast Times, and Keller’s writing since September 11 has often been riveting, but I’m hoping Baron gets the job. Baron has a peculiar advantage over the others: the experience of having blown a huge story because he distrusted the conservative messenger who brought it to him. It is the sort of scar that reminds its wearer not to repeat a painful mistake.

None of the candidates above–or any of the other long shots–are going to set the New York Times on a course of moderation and objectivity. The paper has sailed too far to the left during the last two decades to get itself back to "paper of record" status anytime soon. But if its leadership was committed to at least covering the failures and foibles of the political left, that would be a major and welcome change. Those stories often arrive on platters served up by the center-right. Some media elites sniff at such gifts and turn away. Baron is unlikely to do so.

Before his award-laden tenure at the Miami Herald, which included coverage of Elián González and the 2000 election, a Pulitzer, and being named "Editor of the Year" by Editor & Publisher Magazine, Baron had a short stint at the New York Times. That was a rebound move after a disastrous run as editor of the Orange County Edition of the Los Angeles Times.

Baron joined the Times shortly after his graduation from Lehigh University and a brief stint as a business and state reporter for the Miami Herald. He spent two decades with the Los Angeles paper, during which he absorbed all that editor Shelby Coffey had to teach–especially Coffey’s brand of noblesse oblige towards Los Angeles’s minority communities, disdain for its middle class and suburbs, and contempt for almost all conservatives. When Baron was promoted to editor of the Orange County edition, he brought with him a generous attitude towards his reporters but an almost perpetual sneer towards the community he was supposed to serve–white, affluent, and Republican Orange County.

In the spring of 1994, a Republican candidate for county treasurer, John Moorlach, brought Baron and his staff a detailed analysis arguing that the Democratic incumbent was dangerously gambling with the county’s public funds. The paper dismissed Moorlach’s analysis as politics, and went so far as to endorse the incumbent, Robert Citron, for reelection. By year’s end, Moorlach’s warnings had proven true and Orange County filed the largest municipal bankruptcy in history, having lost $1.6 billion on a hugely leveraged securities portfolio, a staggering loss that would cripple the county with service cuts and crushing debt for years to come. Two years later, Baron departed for New York having seen the appointment of a one-time junior, Bob Magnuson, to a position over his own. Since then Baron’s career has skyrocketed. Orange County is still paying the huge interest tab on the loans it was obliged to take out because the media refused to believe a Republican flagging bad news about a Democrat.

Most sins of the media elite are sins related to pride–to the faux detachment that reporters and editors allow to feed a thinly disguised superiority complex. Because the First Amendment so thoroughly protects the newsroom from the maddening and often incoherent burdens of government regulation, captains of the newspaper industry have zero experience with the crushing weight of bureaucracies. Because they are often called to journalism as a result of a crusading passion, the same troops arrive with the biases of an activist of the left and the maturity of a college newspaper crowd. And because the career paths and salary ceilings of journalism are starkly limited, the disappointment that comes with decades in the business can add bitterness to the toxic mix of arrogance and power.

It takes powerful character to survive such an apprenticeship and then be able to correct the tendencies of a newsroom. Baron has the advantage of having been burned by his own blindness–a mistake he’s not likely to make again. Proponents of fairness in the media could do a lot worse.

Hugh Hewitt is the host of The Hugh Hewitt Show, a nationally syndicated radio talkshow, and a contributing writer to The Daily Standard. His new book, In, But Not Of, has just been published by Thomas Nelson.


Kevin Boylan submitted an opinion piece to the Seal Beach Sun, titled “What price for Rossmoor cityhood?,” opposing incorporation.

The county cannot abandon Rossmoor. It must continue to provide critical services, Supervisor Moorlach’s preference notwithstanding.

The Daily Pilot’s Joseph N. Bell column, “The Bell Curve,” titled “Hoping noise gets grounded,” appreciated alternative ground transportation opportunities to neighboring airports.

Orange County Board Chairman John Moorlach, who told Pilot reporter Brianna Bailey that current relief efforts are concentrating on exporting John Wayne passengers to other regional airports by public transportation, a plan that might hopefully save passengers both time and money – And Newport Beach residents a lot of pain.

Similar efforts – fueled by open minds – are also underway to look for answers many years before the current situation becomes a crisis, that merits a cheering section from the sides.

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