Longtime Newport-Mesa Schools Chief Prepares to Step Down : Education: John Nicoll led the district through one of its most innovative periods. But his departure is overshadowed by the scandal surrounding the embezzlement of nearly $4 million by an employee.

When John W. Nicoll first became superintendent of a unified school district in 1959, he was California’s youngest. Today, he is about to retire as the state’s oldest.

Nicoll has been at the helm of the Newport-Mesa Unified School District for 22 years, during which it became known as one of California’s most innovative and financially sound school districts.

Now the Newport-Mesa district is known across the state for another financial reason. The district has suffered what is considered to be the largest school system embezzlement in California history.

As Nicoll, 71, prepares to step down this spring, parents and teachers outraged over the embezzlement are rejoicing in his decision to resign. But school board members and fellow administrators warn that replacing him will be a challenge.

“He hasn’t always been a popular superintendent, but I don’t think that popularity and greatness always go hand in hand,” said Sherry Loofbourrow, who has been a member of the seven-member school board since 1981.

Most school superintendents survive only a few years before they move on, but Nicoll once joked that he would not step down from Newport-Mesa until his grandson was ready to replace him. Any dreams of a dynasty were dashed by the bleeding ulcer that doctors discovered last month after Nicoll’s quadruple bypass surgery.

“The only reason I am leaving the profession I love so much is because people say if I don’t get out of it, I’m liable to kill myself,” he said in a recent interview.

Since the discovery last fall that the school district’s top financial officer, Stephen A. Wagner, looted nearly $4 million from district accounts, some parents and teachers have challenged Nicoll’s management of the district and demanded his ouster. Nicoll insists that the Wagner debacle did not prompt his decision to step down.

“I am accustomed to pressure; I welcome it,” he said. “I’ve always been interested in the combative side of public life.”

Combative is a description that commonly crops up in conversations about Nicoll, who is known in the district’s central administration as a “lovable porcupine.”

Colleagues and residents laud Nicoll for his intellect and integrity but criticize him for being brash, aloof and arrogant. One-on-one, he is charming; in groups, his sarcastic wit is sometimes seen as condescending.

“I’m perceived by a lot of people as being some kind of an ogre,” he said. “I detest small talk. I put the job first above personal relationships. That doesn’t necessarily lead to warm fuzzies.”

With an IQ hovering around the genius level, Nicoll is a systematic consumer of information and a voracious reader. An only child of working-class parents who loved to read, Nicoll remembers a dinner table where everyone was buried in books and there was “no conversation except, ‘Pass the margarine.’ ”

But Nicoll’s booming voice, erudite vocabulary and frequent quotations from famous authors sometimes alienated co-workers and community residents.

“If he disagreed with you, he had the . . . (habit) of criticizing the verb you just used to put you on the defensive,” said Karen Evarts, who called for the superintendent’s ouster in 1989.

Nicoll shrugs off concerns that he has grown out of touch with rank-and-file employees, and he brushes aside criticism that he closed the lines of communication for parents. He does admit to “a tendency to wander into excessively long words . . . because I love the language so much.”

“I can’t make a speech to the faculty without quoting Shakespeare, and that rubs some people the wrong way,” Nicholl, who began his educational career as an English teacher, said with a laugh. “And if that be treason, make the most of it,” he added, tossing in a line from Patrick Henry.

Under Nicoll, Newport-Mesa was an oligarchy in which trusted employees--high school principals and a 10-member cabinet that included Wagner--enjoyed extensive freedom of operation.

“When he hired somebody for a job, he’d essentially say: ‘OK, this is (yours), go to it,’ ” said Michael Murphy, a district graduate who is now principal of Costa Mesa High School. “Unless there were some real problems, he would just let you do your thing.”

But in the wake of the Wagner scandal, some in the community are outraged that so much financial power was delegated to one individual without a system of checks and controls.

Nicoll blames the scandal on misplaced trust rather than admitting to systemic management problems. As superintendent, he accepts responsibility for everything that happens in the district, but he disagrees with parents and teachers who believe that Wagner’s crimes are grounds for firing those to whom he reported.

“He simply was a very smart man who was in a position of trust and thoroughly abused it,” Nicoll said of Wagner, who rose from accounting clerk to top financial officer over 20 years. “I am saddened by that, but a thief’s a thief.”

With a national reputation as a fiscal wizard and a pioneer in educational programs for teachers and students, Nicoll is seen by peers as the dean of superintendents.

In 1989, a magazine for educators placed him among North America’s 100 “best and brightest” school executives. Today, he heads a statewide group of 70 district leaders concerned about financial matters. He is also at the helm of an exclusive group of 20 Southern California school chiefs.

John F. Dean, Orange County’s superintendent of schools, recalled an advertising campaign in describing him: “When John Nicoll spoke, the superintendents listened.”

While talking about his career, Nicoll cast his gaze upward. “Every damned day of it has been great,” he said, his eyes growing glossy. “I hate to leave it, frankly.”