Gray Davis’ Political Pals Get Lucrative Posts

Despite reforms intended to take the politics out of the appointment of probate referees, state Controller Gray Davis has named political cronies, personal friends, and relatives of campaign contributors and politicians to the lucrative part-time posts, The Times has found.

Among those Davis has appointed are the son of Assembly Speaker Willie Brown (D-San Francisco), the daughter of one of Davis’ largest campaign contributors and wives of labor leaders whose unions gave large amounts to Davis campaigns.

These referees receive as much as $100,000 a year for appraising estates for probate courts and Davis has appointed 165 referees throughout the state.

Davis declined to be interviewed, issuing a brief written statement defending his appointments.

Davis’ chief of staff, Scott Shafer, also defended his boss. “It shouldn’t come as a surprise that elected officials from the President on down want to appoint people they know or whose recommendations (come from people) they know,” Shafer said. “It wouldn’t make any sense to put strangers in positions that require integrity and high performance.”

Shafer and other top Davis aides contend that merit rather than politics is the overriding concern in making appointments.

But an examination of data and his record suggests otherwise. A Times review of Davis appointments over the past six years shows that:

* Many of Davis’ appointees have close ties to the controller, politically or personally, and many have no apparent background in property appraisal or probate law.

* A number of appointees are described by colleagues as “phantom referees” who farm the work out to others while keeping a percentage of the income for little more than signing court papers and correspondence.

* The passing score on a qualifying test, which was intended to ensure the quality of the appointments, varies widely from one test date to another even though the questions on the multiple-choice exam have not changed in five years. After the tests are graded, the controller’s office sets the passing grade; most recently, a candidate for the job could pass by answering fewer than half the questions correctly.

* Limits on campaign contributions by referees and applicants, intended to keep the politics out of appointments, are often circumvented. The law prohibits direct contributions to the controller’s campaign by referees. But close relatives of many referees have made sizable contributions to Davis’ campaign committees.

And Davis annually asks referees to make contributions to a favorite charity in his behalf, collecting the money through the California Probate Referees Assn. This year, association lobbyist William Northrop sent out a letter to all referees describing “a special request that has been made by the state controller for assistance for . . . the United Jewish Fund.” Each referee was asked to send a check for $50 to Northrop for delivery to the controller’s office.

In making these appointments, Davis is following a path blazed by predecessors who were lambasted in their time for using the referee jobs as political plums to reward cronies and campaign contributors.

Critics contend that Davis’ appointment of referees is a throwback to old-fashioned patronage politics.

“It reminds one of an earlier political era that has yet to be cleaned up,” said Common Cause executive director Ruth Holton.

A number of referees said some colleagues are “ghosts,” who do little to earn their fees and are almost impossible to reach. “Too many people are getting paid just for signing their names,” said San Luis Obispo referee Harold Miossi.

Many current and former referees interviewed by The Times were emphatic in what it took to win an appointment under Davis. “You’ve got to have the proper juice,” said San Diego attorney Arthur E. Levy, who served under four controllers before being replaced by Davis last year.

An earlier controller, Republican Houston Flournoy, strode into office in 1967, promising to abolish “the vestiges of a spoils system” in which appointed referees--then called inheritance tax appraisers--set the value of estates for the probate courts.

But the changes initiated by Flournoy--the qualifying exam for applicants and restrictions on political contributions--fell short of taking the patronage out of the appointments.

And Davis’ aides say that there is no reason to do so.

They argued that the process of selection is no more political than the appointment of state court judges by the governor. However, there are some key differences: Judges must hold law degrees, pass the State Bar exam and face a peer review of their qualification. Eventually, they must stand for voter approval.

In his statement, Davis asserted that he had raised the standards for referees and has appointed more women and minorities to the jobs. Davis also gave himself credit for resisting “pressure to reappoint some referees that I believe had served long enough.”

But in a number of cases he replaced veteran referees with individuals whose most important credentials appear to be their political pedigrees.

This summer, the controller appointed Michael Elliot Brown, the 29-year-old son of Speaker Brown.

The elder Brown, whose position makes him one of the most powerful politicians in the state, has endorsed Davis’ bid to become lieutenant governor and appeared at fund-raisers for the onetime assemblyman in June and August, according to Davis’ campaign manager, Garry South.

Davis was asked to appoint Michael by “a number of members of the Democratic (congressional) delegation,” according to Davis aide Shafer.

Although “the Speaker never asked Gray to appoint his son as referee,” Shafer confirmed that even before Michael applied for the job, Davis and Willie Brown discussed the appointment: “Gray said if (the Speaker’s) son was interested, he should take the test, which he did.”

A spokesman for the Speaker said there was no connection between the July appointment of his son and Brown’s decision to endorse Davis. Both Browns declined requests for interviews. But the younger Brown agreed to release copies of his application and test results.

On Brown’s application, the only employment listed was his $36,000-a-year job as “special events director” for his father’s political campaign committee. Under education he checked that he was a high school graduate but did not list his three semesters at San Francisco State University. Left blank were sections asking for background in property appraisal and probate law. The only other experience listed was a brief membership on the state’s acupuncture committee--an appointment made by his father.

Brown passed a probate referee qualifying test required by state law with a mark of 54.5% last November. Only three of the nine applicants who outscored him on that date have been appointed referees. (One of those not appointed was, like Brown, an African-American, who scored 61.8%.)

Like many referees before him, Michael Brown moved into the office of an established probate referee, who does most of the work--in his case, William R. Gray, a certified public accountant who handles cases in San Mateo County.

“I’m his assistant. I do his work,” Gray said in a recent interview. “It’s a very difficult system to come into, off of the street.” He said that Brown does come in regularly to review the work and sign court papers and correspondence.

Last year, San Francisco’s 10 probate referees received an average of $80,000 each in court fees from estates.

Shafer and other ranking members of Davis’ staff say that the required test--a rigorous, three-hour exam--helps ensure that only qualified applicants are chosen.

Data released to The Times shows that the passing score set by the controller’s office varies substantially from date to date--from a mark of 45.5% correct answers in May to 63.6% two years before. The identical test was given on both dates.

Shafer said the passing mark is adjusted for each date to ensure that women and minorities on that day pass at almost the same rate as white males.

When a reporter pointed out that a passing mark on the qualifying test now requires fewer than 50% correct answers, Shafer minimized the importance of the test, pointing out that estate values set by probate referees are reviewed by the courts and subject to revision.

“It’s not like this is brain surgery or plumbing--if someone screws up your toilet there’s a high price to pay,” he said.

Brown is only one example of referees with personal or political ties to Davis.

In 1989, Davis appointed physician Susan G. Spieller, whose husband, Kent Spieller, helped run Davis’ successful 1982 Assembly race. The probate referee said she and her husband were close socially to Davis and his wife and attended the couple’s wedding. “We’re friends,” she said.

While a referee, she completed a residency and fellowship in radiology at Harbor-UCLA Medical Center. She shared a Beverly Hills office with nine other probate referees. Spieller said that she does most of her referee work on weekends and has “a couple of associates doing the fieldwork.” The Spiellers are preparing to move to San Francisco, where Davis has given her a new, four-year appointment.

Newly appointed Santa Clara County referee Rebecca Foster is the daughter-in-law of real estate investor Gordon Pusser, one of Davis’ largest individual contributors. Pusser and his family have contributed more than $30,000 to various Davis campaigns since 1985, including $5,000 to last year’s U.S. Senate race.

Foster said she learned about the job through her father-in-law, but won it because of her community activities and experience in managing a small business office and as a tax preparer for H & R Block.

Pusser did not return phone calls, but did fax a statement, in which he described Davis as “an old family friend,” someone he has helped politically since an unsuccessful race for state treasurer in 1974.

“As a political idealist (‘junkie,’ whatever), I feel shamed that the appointment of my daughter-in-law has obviously compromised the purity of my relationship with Gray,” Pusser wrote.

Davis in recent years has appointed relatives of important labor union supporters, including Orange County attorney Nilane A. Lee, wife of United Auto Workers western regional director Bruce Lee. He serves on the union’s political action committee, which has contributed close to $50,000 to Davis’ campaign committees since 1986, including $10,000 in the last year.

In Ventura County, Davis appointed Norma C. McCarron, wife of Douglas J. McCarron, secretary-treasurer of the Los Angeles area District Council of Carpenters. The union leader contributed $1,000 to Davis’ U.S. Senate race--just months after his wife was appointed referee in 1990. Other union employees contributed $400 each for a total of $8,800.

Davis has also appointed Kathleen Cremins and union representative Daniel Weinstein as Los Angeles County referees. They are the wife and son-in-law of Jerry Cremins, who heads the State Building & Construction Trades Council. The union’s political action committee contributed $5,000 to Davis over the past year.

Another Davis appointee is Lucia Areias, sister of Assemblyman Rusty Areias (D-San Jose), who intends to run for state controller next year. The referee, who lists her profession as real estate broker, said she had no knowledge of any contact between her brother and Davis concerning her appointment.

Last year, the controller named his former chief deputy, James R. Tucker. A Sacramento attorney, who was in charge of the referees while working for Davis, he also holds a two-year, $210,000 legal contract with the controller’s office.

One of Davis’ first appointees, in 1987, was San Diego referee Wilma J. Southworth, mother of developer David L. Malcolm, a Republican named by Speaker Brown to the California Coastal Commission. Malcolm has long been close to Davis. In 1990, he and his wife contributed $2,000 to Davis’ U.S. Senate race--the year before Southworth’s reappointment to a four-year term.

Southworth, a real estate appraiser who once ran her own insurance agency, said she was well-qualified for the job, but agreed that her son played some part in her appointment.

“I’ve always said, in every business, it’s not what you know but who you know,” said Wilma Southworth. “That’s how you got your foot in the door.”

Good political connections not only help win the job, but may be necessary to keep it.

After being stripped of his post by Davis, Marin County referee Louis Sasselli, a longtime Democratic activist, launched an all-out effort to win it back, enlisting the aid of five state senators. He credits his one-year appointment to Senate President Pro Tem David A. Roberti (D-Van Nuys), whose staff intervened with the controller on his behalf.

Sasselli, an insurance broker, was first appointed in 1975 by fellow Democrat Ken Cory, with the support of then state Sen. Barry Keene, a close friend.

“The whole list (of referees) is made up of people who got the jobs because their fathers have given money or close political friends, not on a meritorious basis,” Sasselli said.

Roberti, who was out of the country, could not be reached for comment, but a spokesman said that Roberti aide David Commons spoke to the Senate president about intervening on Sasselli’s behalf.

Commons, who contributed $500 to Davis’ Senate campaign in 1991, is the father of attorney Geoffrey D. Commons, another Davis-appointed probate referee.

Politics and Probate Referees

State Controller Gray Davis appoints the state’s probate referees, who fill part-time jobs that can mean up to $100,000 in fees each year. Many of the appointees are people with close ties to Davis or to other figures in California politics. Among those he has named to the posts: REFEREE (COUNTY): Lucia Areias (Santa Clara) ’92 GROSS INCOME: $68,455 CONNECTIONS: Real estate broker. Sister of Assemblyman Rusty Areias (D-San Jose). REFEREE (COUNTY): Michael E. Brown (San Francisco) ’92 GROSS INCOME: New CONNECTIONS: Son of Democratic Assembly Speaker Willie Brown of San Francisco. REFEREE (COUNTY): Geoffrey Commons (Los Angeles) ’92 GROSS INCOME: $31,885 CONNECTIONS: Attorney. Son of David Commons, aide to Senate President Pro Tem David A. Roberti (D-Van Nuys). REFEREE (COUNTY): Elwin (Ted) Cooke (Los Angeles) ’92 GROSS INCOME: $31,751 CONNECTIONS: Culver City police chief. REFEREE (COUNTY): Kathleen Cremins (Los Angeles) ’92 GROSS INCOME: New CONNECTIONS: Wife of state Building & Construction Trades Council head, Jerry Cremins. REFEREE (COUNTY): Jane Dolan (Butte/Tehama) ’92 GROSS INCOME: $98,957 CONNECTIONS: Real estate appraiser. Butte County supervisor. Wife of Bob Mulholland, political director of state Democratic Party. Father was probate referee. REFEREE (COUNTY): Rebecca Foster (Santa Clara) ’92 GROSS INCOME: New CONNECTIONS: Daughter-in-law of real estate investor Gordon Pusser, who with other family members donated to Davis campaigns. REFEREE (COUNTY): C. Hugh Friedman (San Diego) ’92 GROSS INCOME: $42,639 CONNECTIONS: University of San Diego law professor. Friend of Davis since late 1970s when appointed to State Board of Education. Wife is Rep. Lynn Schenk (D-California). REFEREE (COUNTY): Peter Jensen (Sacramento) ’92 GROSS INCOME: $73,751 CONNECTIONS: Attorney. Capitol lobbyist. REFEREE (COUNTY): Nilane A. Lee (Orange) ’92 GROSS INCOME: $38,127 CONNECTIONS: Attorney. Wife of United Auto Workers western regional director Bruce Lee. REFEREE (COUNTY): Norma C. McCarron (L.A./Ventura) ’92 GROSS INCOME: $38,406 CONNECTIONS: Wife of secretary-treasurer of Los Angeles-area District Council of Carpenters, Douglas J. McCarron. REFEREE (COUNTY): Wilma J. Southworth (San Diego) ’92 GROSS INCOME: $51,015 CONNECTIONS: Real estate appraiser. Mother of David Malcolm, coastal commissioner and contributor to Davis campaigns. REFEREE (COUNTY): Susan Spieller (San Francisco) ’92 GROSS INCOME: $49,017 CONNECTIONS: Physician. Friend of Davis. Wife of Kent Spieller, who helped run Davis campaign and was Democratic candidate for Assembly. First a referee in Los Angeles during her medical residency. REFEREE (COUNTY): James Tucker (Sacramento) ’92 GROSS INCOME: New CONNECTIONS: Attorney. Former chief deputy to Davis. REFEREE (COUNTY): Daniel Weinstein (Los Angeles) ’92 GROSS INCOME: $36,303 CONNECTIONS: Union represententative. Son-in-law of state Building & Construction Trades Council head, Jerry Cremins. REFEREE (COUNTY): Karen West* (Los Angeles) ’92 GROSS INCOME: $43,814 CONNECTIONS: Wife of Laker General Manager Jerry West. Stepdaughter of probate referee John Belton. * First appointed by Controller Ken Cory, reappointed by Davis.

Source: State controller’s office records, interviews.

BACKGROUND

The 165 probate referees set the value of estates whenever someone dies and the distribution of property is settled in probate courts. Not all estates go to probate. Increasingly, many are settled outside of court through a legal document called a living trust. But when they do go to probate court, it is up to courts in each county to assign the estates to the referees--usually on a rotating basis. The job of the referee is to put a dollar value on all tangible property, including stocks, bonds, automobiles and real estate. They estimate the value of furniture, paintings, jewelry and other valuables.