With national and state elections completed, Orange County’s all-Republican Board of Supervisors took time out this week to meet with its department heads and look five years into the future.
The half-day retreat, the first in six years, is part of the county’s strategic financial plan. It was attended by all of the county’s department heads and independently elected officials, and its aim was to predict where county finances and organizational culture are headed.
And it’s not necessarily a pretty picture.
As representatives of one of America’s most Republican counties, its delegation in Sacramento now has the challenge of facing a Democratic supermajority that some describe as openly hostile to Orange County.
“We’re isolated,” said Nick Berardino, general manager of the Orange County Employees Association, whom county supervisors have often credited as an important lobbying partner for county officials in recent years, given his close personal ties to Gov. Jerry Brown and Assembly Speaker John Perez.
Berardino said that the county’s ideological stances come with a price. “The taxpayers are isolated, and they’re going to be paying the biggest price,” he said.
And there’s increasingly little budgetary flexibility.
After years of cutting budgets and telling the public that it can do more with less, department heads are now telling supervisors in strategic planning focus groups that it may be time to prepare county residents for what’s coming next: less with less.
“The No. 1 question I get is how’s the county doing [financially],” said Board of Supervisors Chairman John Moorlach.
“Revenues are flat, but costs are rising,” said Moorlach. He said that many residents ask him whether the county will follow Stockton and San Bernardino into bankruptcy.
Moorlach noted that next week the Orange County Employees Retirement System is scheduled to vote on its annual interest rate assumptions. If they are lowered, the county budget could be in for a substantial hit, underscoring what Moorlach sees as an unsustainable approach to financing rising pension costs.
In addition to that, virtually all sides agree that employee morale is at an all-time low.
“My biggest challenge has been the morale of the employees,” Moorlach said, bemoaning his inability to give salary raises because of rising pension costs.
Morale hit bottom in July when District Attorney Tony Rackauckas charged Carlos Bustamante, a former county Public Works executive and outgoing Santa Ana councilman, with 12 felony sex crimes. CEO Tom Mauk and a host of other top officials were either fired or forced to resign in the fallout from Bustamante’s arrest.
Recently, the OCEA, locked in labor talks with the county, also shocked county supervisors when the union released reams of emails detailing how top political aides working for supervisors got jobs within the county bureaucracy, often times sidestepping hiring freezes or other civil service procedures.
During this so-called Super Bowl of union negotiations with all labor groups at the county negotiating contract renewals, supervisors have made seemingly little progress. Recently managers’ union members voted down a county offer that would have meant higher pension payments for employees.
Interim CEO Bob Franz told county supervisors during the retreat this week that it isn’t just the rank and file that are upset. Executives remain frustrated over hiring freezes and prefer to be given budget targets along with the freedom to meet them, Franz said.
Franz also noted that county focus groups conducted over recent months indicate that the county bureaucracy has become somewhat paralyzed by contradictory swings on the Board of Supervisors in recent years with trends toward centralization followed by decentralization.
The result today is a mishmash of decentralized processes, with things like information technology, human resources and procurement being handled at the department level in multiple agencies as opposed to having more centralized approach toward technology, employee relations and purchasing.
According to the focus groups, there also seems to be concern about lack of succession planning with agencies finding it difficult to replace experienced workers leaving due to enhanced pensions.
A stopgap measure has been an increased use of retirees as contract workers, which department heads seem to favor but union leaders oppose.
Franz told supervisors that the biggest financial challenge facing them is managing the dual challenge of bolstering cash reserves while also funding overdue infrastructure maintenance.
Finally, Franz noted that county executives admit being intimidated by the Board of Supervisors and have problems communicating with them, both through weekly agenda reports that are part of public meetings and at the dais.
Executives are also struggling to find a way to encourage more risk taking by managers and workers at the county and engaging in more systematic viewing of their workflows through processes such as the manufacturing efficiency program known as LEAN (Preserving Value with Less Work).
“We need to find a way to reward risk taking in the county,” said Mahesh Patel, the County’s chief information officer for technology. “The price of failure can be pretty high.”
County Supervisor Janet Nguyen, known for her tough grilling of department staff at board meetings, called the supervisors “a big, 800-pound gorilla in this room.”
“I don’t really think the department heads know where the Board of Supervisors want to go,” Nguyen said.
She said board members must do a better job of communicating what their priorities are, using as an example the emphasis on parks in South County’s 5th Supervisorial District and the emphasis on health and social welfare programs in her central county 1st District.
“We need to reflect or understand what these values truly mean and what our priorities are,” Nguyen said, adding that her emphasis is on providing eligible residents access to government programs. “I see this as a partnership,” Nguyen said.
County Supervisor Shawn Nelson said he sees his relationship to county bureaucrats in a very different light.
“I’m not staff,” Nelson said. “I’m here as a representative of the people.”
Nelson sees the selection of a new CEO, expected by spring, to be the most critical decision facing supervisors.
“If we get that right, a lot of these problems tend to take care of themselves,” said Nelson, who was critical of the resources spent on the strategic retreat at the Santa Ana police headquarters conference room.
“I’m more focused on getting things done than on different shades of pens on sheets of papers,” Nelson said.
Since you've made it this far,
You are obviously connected to your community and value good journalism. As an independent and local nonprofit, our news is accessible to all, regardless of what they can afford. Our newsroom centers on Orange County’s civic and cultural life, not ad-driven clickbait. Our reporters hold powerful interests accountable to protect your quality of life. But it’s not free to produce. It depends on donors like you.
BREAKING TEXT ALERTS
Subscribe today to receive Voice of OC’s breaking news text messages (free beyond your standard messaging rates).