O.C. Supervisors Blasted for Rush to Hire Moorlach

The co-chair of the state Senate panel probing the Orange County financial fiasco blasted the Board of Supervisors on Monday for planning to appoint a new county treasurer without a wide search for the best candidate.

“We cannot allow this Board of Supervisors and (its) financial team to go on running the show as they have,” Sen. Lucy Killea (I-San Diego) wrote in a letter to her colleagues on the state Senate Special Committee on Local Government Investment. “They continue to demonstrate themselves incapable of breaking out of the incestuous political culture they created.”

In a separate letter to the supervisors Monday, the foreman of the Orange County Grand Jury joined what has become a chorus of criticism, urging the board to expand the selection process “to restore the confidence of the Orange County electorate.”

“We just feel a little more openness in the selection process will restore confidence in our leaders,” explained Mario Lazo, foreman of the government watchdog group. “They’re free to do what they do. We just hope they do things to restore confidence in county government.”

After more than two decades as treasurer-tax collector, Robert L. Citron resigned Dec. 4, two days before Orange County became the largest government entity in U.S. history to declare bankruptcy. Thomas E. Daxon, who was appointed interim treasurer, plans to leave the county March 20.

Four of the five supervisors had been poised to appoint, as early as today, Costa Mesa accountant John M.W. Moorlach--who lost in a landslide when he ran against Citron last year. But that move has been delayed because of a routine background check being conducted by the Sheriff’s Department.

Despite the criticism from Killea and the grand jury, supervisors reiterated their commitment Monday to appointing Moorlach as treasurer-tax collector as soon as possible.

“There’s only one candidate right now, and that’s John Moorlach,” said Supervisor Roger R. Stanton. “It’s pretty hard to back a phantom candidate when there’s nobody else out there with their hand up.”

Last week, the board rejected a plan proposed by county Chief Executive Officer William J. Popejoy, and backed by Daxon, to have a committee of five financial experts establish qualifications and criteria for the position and conduct a national search to fill it. Popejoy and Daxon, as well as other observers, have suggested that someone with more investment experience than Moorlach--who has spent his career handling tax matters--might be a more prudent choice.

But the supervisors said that forming such a committee and conducting a nationwide search for the best possible treasurer candidate would be a waste of time, because they had already made up their minds to appoint Moorlach.

Supervisor Marian Bergeson said Monday a national search would take too long, but that she and Supervisor Gaddi H. Vasquez plan to propose a compromise in which the board would hold a public hearing and question Moorlach, similar to the confirmation process for appointed posts in the state and federal governments.

“The position needs to be filled as soon as possible,” Bergeson said. “Mr. Moorlach has been very much aware of the events that have transpired, so the learning curve would not be as great as if you were going with someone from out of state.”

But Killea accused the board of simply playing politics by crowning Moorlach, who has been widely praised in public forums as the prophet who predicted the county investment pool’s stunning collapse.

Citron was the only Democrat in a countywide elected office. Moorlach has been active in local Republican Party politics.

Moorlach fired off a letter Monday responding to Killea, and complained in an interview that “somehow I’ve become the victim of the process.”

“I never told the board to not go through this (selection) process. If they need to ask questions, that’s fine,” Moorlach said. “I’m just feeling like, wait a second, how come I’m getting beat up? I have no control over these things.

“I definitely know I’m qualified,” Moorlach added. “This is not just managing money, this is a twofold discipline. It’s treasurer hyphen tax collector. I’m a certified public accountant, I’m also a certified financial planner. I have proven that I have knowledge of investment.”

In her letter, Killea complained about Moorlach’s testimony before the special committee last Friday, in which Moorlach refused to name the experts who helped him analyze the investment portfolio during the campaign. Moorlach also criticized state officials for not stepping in to help financially strapped Orange County schools.

In the letter to her Senate colleagues, Killea also blasted Daxon for choosing A. G. Edwards as one of the county’s new underwriters as a reward because one of the firm’s local broker’s was among the first to criticize Citron’s risky investment practices and then became involved in Moorlach’s campaign.

“Appointing Moorlach treasurer and selecting this firm are completely political acts that relegate the public interest to the back burner,” said Craig Reynolds, Killea’s chief of staff. “They just can’t seem to get away from responding to the political wind that blows them here and there.”

Throughout the three-month crisis, Killea has had harsh words for the supervisors and other county officials, often suggesting that the state remove some of their power. On Friday, she said Popejoy’s testimony before the committee renewed her confidence in the county’s ability to recover from the crisis, but the impending Moorlach appointment has increased her concern.

“It doesn’t instill confidence in their actions down there for them to pick this guy without looking at any other candidate,” Reynolds said. “Both of these actions only further establish the need to provide more oversight with some new teeth and authority to make financial decisions.”

But Sen. John R. Lewis (R-Orange), one of two Orange County lawmakers on the 10-member committee, said he supported the board’s impulse to pick Moorlach now.

“I think Mr. Moorlach proved his mettle,” Lewis said Monday. “All of the so-called experts were defending or participating in the Orange County mess, and Mr. Moorlach was the one person that was swimming against the tide and was ultimately proved right.”

Lazo, the grand jury foreman, said his group is not opposed to Moorlach but simply wants him to undergo a rigorous and open interview process to determine whether he is the most qualified person for the job.

“We’d like to know what the supervisors believe the qualifications for the job should be. We’re not saying Mr. Moorlach doesn’t have the qualifications, but we don’t know what the qualifications are,” he explained. “We just don’t know Mr. Moorlach. . . . We hope there’s more openness.”

Times staff writers Diane Seo and Anna Cekola contributed to this story.

* PLEADING THEIR CASE: O.C. leaders head for Sacramento in search of help. A17