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 inisted 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 out after he submitted papers for retirement to the city of San Diego, 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.
Correction: A previous version of this story incorrectly stated that Jay Goldstone, the former chief operating officer of the city of San Diego, worked for San Diego County. We regret the error.