Popejoy, Board Get Tough With Auditor Lewis : Personnel: Embattled official, who won’t quit and can’t be fired, is told he can’t be trusted to respond to state report.

He refuses to leave. They can’t make him go. So on Tuesday the Orange County Board of Supervisors started playing hardball with Auditor-Controller Steve E. Lewis.

Lewis, under fire for allegedly failing to alert the supervisors and others to financial maneuvers that led to the county’s bankruptcy, was told he could not be trusted to compile data in response to a state auditor’s report that blames much of the county’s fiscal woes on poor oversight from Lewis’ office.

“Frankly, we just have no confidence in you,” Chief Executive Officer William J. Popejoy said bluntly, as Lewis stood at the public speaker’s lectern, hanging his head. “I really cannot in good conscience use Mr. Lewis in view of his track record in the past.”

Board Chairman Gaddi H. Vasquez said after the board meeting that he believes Lewis will be stripped of more--if not all--duties in the future.

“We don’t have much of a choice,” he said.

Popejoy said a panel of five people from other departments would draft a response to the report by state auditor Kurt R. Sjoberg.

Lewis repeatedly defended himself Tuesday, contending that his office had neither the staff nor the financial expertise needed to decipher the operations of former Treasurer-Tax Collector Robert L. Citron, whose risky investment strategy led the county to declare the largest municipal bankruptcy in U.S. history on Dec. 6.

“We did all we could do,” Lewis repeated, underscoring his longstanding contention that he was duped by Citron as badly as the supervisors were. “I think we are being penalized improperly. The auditor’s office has served the county well for many years.”

Lewis said his office worked with the documents Citron gave him, and those documents painted a rosy financial picture for the county.

“It’s not the job of the auditor to do the job of” Citron’s department, he said.

But Popejoy said the auditor at the very least should have alerted the board to suspicious activities.

“An auditor must raise those red flags,” Popejoy said. “You didn’t raise those red flags.”

The meeting became particularly confrontational when Supervisor Roger R. Stanton noted that Lewis never came before the board to raise concerns about Citron, but found the time to complain that he was unhappy about the size of his pay raise.

Lewis, who was elected last year to a third four-year term, has refused to resign despite requests from Popejoy and the public. Lewis drew snickers from the audience Tuesday when he told the board he believes the position of auditor-controller should remain an elected post, a status that prevents him from being fired by the board.

The state auditor’s report found that Lewis improperly transferred $73 million in restricted funds--money that, by law, can only be spent for specific purposes--into the county’s general fund six days after the bankruptcy.

Lewis appeared flustered at times during Tuesday’s hearing, and was often unable to answer direct questions about his office and its operations. He frequently interrupted supervisors’ questions to offer answers. Vasquez noted that he seemed “exceedingly defensive.”

Lewis admitted that policies have changed in his department since the fiscal debacle. In the past, mid-level clerks were authorized to review financial transactions involving millions of dollars. Now, such transactions must go through supervisors. But Lewis was unable to say whether the limit involved sums of more than $250,000 or even $1 million.

At another point, Lewis told the board he had read the state auditor’s report but said he might have trouble answering direct questions about it.

At one point, Vasquez publicly marveled at the fact that Lewis, who once nixed the idea of allowing supervisors to carry credit cards, is now being criticized for lax oversight.

“It’s quite a statement when the CEO says . . . you’re not invited to the meeting,” Vasquez said to Lewis. “That’s a serious exclusion.”