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SAN JUAN CAPISTRANO : Administrators Say Julian Repaid $2,000

As City Council members continue to seek an audit of municipal loans made to City Manager Stephen B. Julian, city financial administrators have determined that the executive repaid a $2,000 loan that he obtained in December, 1987.

Julian had previously described the $2,000 loan as a non-refundable disbursement. However, Administrative Services Director David P. Bentz said city records he has reviewed show that Julian repaid the $2,000 at the same time--on Dec. 31, 1987--that he repaid two other loans.

For the record:
12:00 AM, Mar. 01, 1992 For the Record
Los Angeles Times Sunday March 1, 1992 Home Edition Part A Page 3 Column 4 Metro Desk 5 inches; 162 words Type of Material: Correction
Stephen B. Julian, city manager of San Juan Capistrano, filed a lawsuit last month against The Times and several of its employees for libel. The lawsuit claims, in part, that the articles and editorials published during January and February, 1991, accused Julian of illegal and corrupt conduct in his financial dealings with the city of San Juan Capistrano.
The Times wishes to make clear that the articles did not state and were not intended to imply that Julian is a corrupt public official. Additionally, the articles did not state, nor were they intended to imply, that Julian participated in any illegal activity or that any of the terms and conditions of his employment were illegal.
As The Times reported on March 9, 1991, the Orange County district attorney’s office declined to investigate Julian’s dealings with San Juan Capistrano, stating that it had no evidence suggesting that any crime had been committed.
Julian contends that the articles harmed him and caused him and members of his family to be the subject of harassment. The Times does not condone or encourage any harassment of Julian or his family and regrets any harm that may have occurred.

The Times reported Jan. 6 that the transactions were part of five city government loan debts, totaling $398,235, that Julian incurred from 1981 through 1990. The report noted that the $2,000 check, issued to Julian on Dec. 21, 1987, was described in a city computer printout as, “Additional CM Loan.”

No date for repayment of that loan was specified in city documents. And Julian, in an interview last month, disputed whether the $2,000 check was for a loan, terming it a “payout.”

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“It’s probably just a straight piece of monies that are available to me,” Julian said, adding: “No, I don’t think that’s a loan at all.”

Julian did not return calls for comment Friday.

Bentz, however, said Friday that he determined after reviewing the accounts into which Julian’s repayments have been credited that the $2,000 had been repaid 10 days after it was issued.

Julian has said the loans were entirely proper. Members of the City Council who served throughout the 1980s have said they too viewed the transactions as correct.

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Records indicate that, as of Friday, Julian continues to owe the city $82,091.75, at no interest. Julian, in a recent statement, said he owed about $46,000.

Julian in that statement also referred to a separate $38,500 loan he obtained from the city in May that is secured by his accrued leave benefits.

In a related development, Mayor Kenneth E. Friess said the city will not, as he had hoped, receive results of an audit of the loan transactions before the council’s next meeting, on Feb. 5.

Friess said in an interview that the city had not yet retained an outside law firm to perform the audit, commissioned unanimously by the council on Jan. 15.

Also, a local lawyer who has vowed to press a recall campaign against Friess and another longtime council member, Gary L. Hausdorfer, said state election law will delay until March his effort to circulate petitions.

The lawyer, Carlos F. Negrete, said that because Hausdorfer was reelected in November and installed to a new term in December, the law prohibits the circulation of recall petitions until March.


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