Fed-Up Popejoy Calling It Quits : Recovery: Saying supervisors’ meddling left him unable to do his job, O.C. chief executive will end rocky term five months early. Surprised board looks for a replacement.

Orange County Chief Executive Officer William J. Popejoy, who has spent the past five months trying to put the bankrupt county on the path to recovery, abruptly announced his resignation Wednesday, saying his bosses had become so meddlesome that he could no longer do his job.

“This decision is based on recent actions by the Board of Supervisors to re-involve themselves in details of the county’s administration and management of the county’s bankruptcy crisis,” said Popejoy, who--as a condition for taking the job in February--had demanded greater day-to-day autonomy and authority than his predecessor, who failed to head off the largest municipal bankruptcy in U.S. history.

“I think they want to go back to business as usual. It’s a recipe for disaster,” said Popejoy, a retired business executive from Newport Beach who offered his services for free and has declined to accept a salary from the county. “They have pretty short memories.”

Popejoy’s sudden resignation--which takes effect July 31, or four months before the expiration of his contract--capped an often stormy relationship between the highly visible executive and his bosses but also redirects the spotlight at the supervisors, forcing them to develop quick plans to find a replacement and proceed with the county’s bankruptcy recovery effort.

Looming in the background is the possibility of a state takeover.

Gov. Pete Wilson, a strong supporter of Popejoy, said Wednesday he was saddened and disappointed by the news. He criticized the supervisors for trying to curtail Popejoy’s authority and said he will be closely monitoring what transpires next in Orange County.

“I think it was a mistake not to give him [the] authority” needed to do the job, Wilson said. “I think the board has to understand, they are on the spot. They are going to have to do some very unpleasant things [Popejoy] was prepared to do.”

“Obviously the governor cannot dismiss the possibility of establishing a trusteeship” to oversee the county’s financial affairs, said Wilson spokesman Paul Kranhold.

Although Popejoy and his team of advisers had made strides in cutting budgets and pushing emergency legislation past unfriendly Sacramento lawmakers, the county is not much closer now to figuring out how to pay its $1.7-billion debt then it was when Popejoy first took the job.

The linchpin of the county’s recovery plan--a 10-year increase in the local sales tax from 7.75% to 8.25%--was soundly defeated by Orange County voters in a special election June 27.

Popejoy’s resignation was a disappointment for some, but a cause for celebration for others.

“I think this is a very sad day for Orange County,” said Sheriff Brad Gates. “It’s a tremendous loss. I think it probably makes it much more difficult for the county to move ahead under one leadership.”

“I am disappointed because I thought Bill Popejoy was doing a good job of leading a disgruntled army,” said state Sen. William A. Craven (R-Oceanside), co-chairman of a Senate special committee on the bankruptcy. “It leaves the county with five cooks in the kitchen,” he said in reference to the five-member Board of Supervisors. “And it will make for the production of a rather strange broth.”

Even some of Popejoy’s detractors said he may have been treated unfairly by the supervisors.

“I think he’s getting a raw deal,” said Bill Mello, a leader of the anti-tax Committees of Correspondence who frequently fought with Popejoy over the top executive’s unsuccessful effort to use the sales tax increase to bail the county out of bankruptcy.

Some critics, however, said it was Popejoy’s insistence on the tax--known as Measure R--that really was the force behind his departure. When voters overwhelmingly rejected the measure last month, they sent a message that Popejoy should step aside, some said.

“I think this is for the best,” said Carole Walters, president of the Orange Taxpayers Assn., another group that vigorously opposed the tax. “He didn’t communicate well with the board. He looked down on the people.”

Buck Johns, a prominent county developer, agreed.

“When voters rejected [the tax], slammed the door on that, I think he had to go. I think this will help the county get back on the right track,” Johns said.

County supervisors, meanwhile, seemed taken aback by Popejoy’s move.

“I’m surprised. I did not have any indication that this was going to happen,” Board Chairman Gaddi H. Vasquez said.

Popejoy dismissed any suggestions that he was leaving because of the tax issue.

He said he regretted leaving the county before his nine-month contract expired but said he was left no choice when the supervisors last week began trying to resume micro-managing county operations as well as the recovery effort.

“It wasn’t what I wanted,” said Popejoy. But, he said, “I have a right to spend my time the way I want to.”

County supervisors, who have complained bitterly that Popejoy made too many crucial decisions on the county’s recovery efforts without their input, met in closed session last week to rein in his authority and make him more accountable to the board.

The move was interpreted as a slap in the face to Popejoy, who had pushed the board members into adopting drastic cuts he wanted in the county’s budget, maneuvered them into putting the controversial tax hike on the ballot despite their near unanimous opposition, and challenged them publicly when he felt they were playing politics at the county’s expense.

When Popejoy was hired, the supervisors converted their previous county administrative officer to a chief executive officer to give him broader authority to run county operations.

Popejoy’s willingness to use the expanded powers, however, created friction between him and his bosses.

The result was a dysfunctional county government.

“This would make a pretty good plot for a Woody Allen movie,” quipped a frustrated Popejoy as he called lawmakers in Sacramento to tell them of his decision. “I’d like to leave as nicely as possible, but I can’t be a fraud either.”

Chief among the board’s complaints were perceptions that supervisors were often the last to know what Popejoy was doing.

One of the most glaring examples came when Popejoy secretly went to New York to meet with Merrill Lynch executives about the county’s $2-billion suit against the Wall Street giant. Some of the supervisors complained that they didn’t learn of the trip any earlier than the news media.

Supervisors also hit the roof when Popejoy publicly called for making the position of board members part-time jobs, and urged that power be centralized and given to a strong-willed CEO--not unlike himself.

But his attacks were also personal.

Shortly after taking the job, Popejoy blasted Supervisor Jim Silva for displaying a lack of leadership for refusing to cut his own office budget at the same time he was calling for cuts countywide. Most recently, he butted heads with Supervisor Roger R. Stanton, when he asked the Orange County Grand Jury to investigate and remove Stanton for alleged misconduct in office.

“Anyone who does not want to be here should leave,” said Silva, the only supervisor who had publicly urged that Popejoy be fired. Silva said he appreciated Popejoy’s work for the county, but made it clear that Popejoy’s replacement will follow the will of the board.

Stanton declined to comment.

Popejoy’s closest relationships on the board were with Supervisors Marian Bergeson and William G. Steiner.

“I’m disappointed, and I’m troubled,” Bergeson said of Popejoy’s resignation. “I think his presence is very much needed. It’s a real loss to the county. He’s been extraordinary in the most troubling of times. He has provided the emphasis to bring us to where we are now, which is really incredible in terms of the severity of the problem.”

Steiner said he too will miss Popejoy.

“He made a big investment in the county crisis and should be given credit for his accomplishments,” Steiner said. “I haven’t always agreed with him, but I’ve never questioned his motives.”

In a news release announcing his resignation, Popejoy thanked some people he has worked with in the county, including Sheriff Gates, county Health Care Agency Director Tom Uram, Dist. Atty. Michael R. Capizzi, Steiner and Bergeson.

It was no surprise that Vasquez was not among those named. Sources said Popejoy felt Vasquez betrayed him by trying to limit the scope of his authority.

Vasquez said he didn’t reduce Popejoy’s powers, just made him more accountable to the board.

Many outside county government, particularly in Sacramento, found Popejoy’s willingness to confront supervisors refreshing.

“I found him to be rational and constructive, with a problem-solving approach,” said Senate President Pro Tem Bill Lockyer (D-Hayward). “I think those skills may be missed.”

Sen. John R. Lewis (R-Orange) said: “The people of Orange County owe Mr. Popejoy a debt of gratitude. We haven’t always seen eye to eye, particularly on Measure R, but I know he was pursuing the course he felt was for the best of Orange County.”

Jon Schotz of Saybrook Capital Corp., financial adviser to participants in the county’s failed investment pool, said the loss would be lamented by county creditors as well as the public market.

“I think he was a straight shooter. He did a lot of good for the county when there was a total leadership void. And who knows what’s coming next,” Schotz said. “It sends a very bad signal to the marketplace. What Popejoy was able to do was convey a sense of someone being in charge. . . . You’re going to end up seeing the return of the fiefdoms, which is not a good thing for this bankruptcy.”

But not all were kind. Noting that Popejoy worked for free during his tenure with the county, Assemblyman Mickey Conroy (R-Orange) derided his performance.

“You get what you pay for,” said Conroy, who is planning a run for the Board of Supervisors next year. “Apparently he was dissatisfied with the supervisors taking away authority that he never should have been given. I think he became enamored of the bureaucrats and paid little attention to the working stiffs. He wanted to raise taxes, and that’s not in the cards.”

Popejoy told individual aides and consultants in private meetings Wednesday and earlier this week that he was planning to leave. On the third floor of the Hall of Administration, where Popejoy’s office is located, the mood was somber, staffers said.

One of the supervisor’s secretaries said she was so sad she “felt like crying.”

Another Popejoy supporter, however, said his resignation made her very happy.

“I’m delighted,” said Popejoy’s wife, Nancy. “He can go back to doing whatever he wants to do, and doesn’t have to deal with this anymore.”

Times staff writers Rene Lynch, Jodi Wilgoren, Eric Bailey, Dave Lesher, Peter M. Warren and correspondent Shelby Grad contributed to this report.

More Coverage: Popejoy Resigns

* NEW BODY, SPIRIT: Whoever replaces CEO must be more subordinate, supervisors say. A14

* TOO MANY COOKS: Popejoy says supervisors “have taken back the CEO job for themselves.” A14

* WALL STREET VIEW: Analysts say resignation could increase pressure for state takeover. A14

* LEGISLATORS’ PLAN: O.C. delegation’s proposes that cities forgive debts owed by county. A15

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

CEO Says He’s Had It

County Chief Executive Officer William J. Popejoy announced Wednesday that he would resign as of July 31, citing recent moves by the Board of Supervisors to “re-involve themselves” in running county government.

“I think they [the supervisors] want to go back to business as usual. They have pretty short memories. It’s a recipe for disaster.”--William J. Popejoy

* Date hired: Feb. 10

* Resignation effective: July 31

* County action: Has hired New York-based recruiting firm to help find new CEO

* Possible interim CEO: Health Care Agency Director Tom Uram

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Popejoy’s Resignation Letter

It is with considerable personal regret, I have today submitted my resignation to the Chairman of the Board of Supervisors effective July 31, 1995.

This decision is based on recent actions by the Board of Supervisors to re-involve themselves in details of the County’s administration and management of the County’s bankruptcy crisis. The termination date of July 31, 1995 reflects the Supervisors’ stated objective of replacing the CEO with a position of less clear authority and responsibility by month end. As elected Supervisors, they have the prerogative to take such action. However, the re-involvement of the Board in day-to-day operation is, in my opinion, a return to the management structure which existed prior to the creation of a CEO and will not allow me or my successor to do the job that is needed to be accomplished.

Their renewed involvement in the county’s administration saddens me, as a citizen, for I feel it does not serve the residents of this County well.

I wish to thank the people of Orange County for this opportunity to serve them--serving their best interests has always been my foremost objective.

There are too many others for me to thank them all at this time, but I’ll try to do so soon.

I must, however, thank Marian Bergeson, Bill Steiner, Brad Gates, Tom Uram, Mike Capizzi and the Volunteer Executive Team (VETs), who have been such a pleasure to work with.

Thanks also to the employees of Orange County who have made many sacrifices during these terrible times.

I most sincerely wish the County well; this wonderful community has long been my home and will remain so.