ORANGE : Residents Show Anger Over Investment Crisis

Mayor Joanne Coontz assured residents this week that “the city is not going to go broke” and that the City Council will have a plan in place by January to deal with the bond crisis.

But her speech failed to soothe angry residents Tuesday who asked why the city had not done more sooner to pull its $28 million out of the county’s pool.

Two of the speakers alluded to minutes from an April, 1994, council meeting quoting Coontz as being uneasy about the city’s investment policies and, specifically, about the $33 million the city had in the pool then.

Resident Nick Lall suggested that the entire council resign because members failed to follow their own investment policy, which does not allow speculation.

“Why don’t you save us all a recall effort and resign right now,” Lall told the council members. “The city investment committee has failed miserably and the City Council has failed miserably in following (its) policy.”

City Manager David F. Dixon said the city had reduced the city’s investment in the fund to $28 million. He conceded that the city had borrowed $8.7 million to invest in the pool as late as July. He noted that the city previously had benefited from high returns, and that county treasurer’s reports on the pool had been “glowing.”

“We can point fingers, but I’ve always been told that if you point one finger, three more will point back at you,” Dixon said.

Resident Alice Clark pointed a finger at Councilman Mike Spurgeon, who is also chief of staff in Supervisor William G. Steiner’s office.

“I think Councilman Spurgeon should step down immediately,” Clark said. “Many citizens of Orange have had a serious problem with the fact that Councilman Spurgeon now works for the county of Orange, as well as serving as one of our councilman. It is no longer good enough to deny that there is any legislation which would prevent such double-job activities.”

Spurgeon later said that Clark was trying to “hang me with the county bankruptcy.”

“I run Steiner’s staff,” he said. “I don’t run Steiner. Nor do I run the Board of Supervisors.”

Dixon, meanwhile, said residents should expect no immediate impacts but that the staff was working on worst-case and best-case scenarios.

“The city will pay its bills, we have a positive cash flow, we are not declaring bankruptcy,” Dixon said. “We are going to carry on the services of this city in a manner that is acceptable. . . . It is not going to be an easy road and it may take several years to overcome this problem,” he said.