Plan OKd to Keep O.C. Financial Advisors

The Board of Supervisors on Tuesday approved a plan that will allow the five members of the Treasury Oversight Committee to continue monitoring county investment policies despite a state law that is forcing them to resign their posts.

The panelists plan to step down later this month and join a newly formed Technical Advisory Committee, where they will continue to discuss investment issues with Treasurer-Tax Collector John M.W. Moorlach.

The resignations are necessary because of a state law taking effect Jan. 1 that prohibits oversight committee members from working as securities dealers, bond underwriters or brokers for three years after leaving the panel. All five members, who are employed in the financial services field, said they could not afford to comply with the restrictions.

Because the new technical committee is not covered by the law, members will still be able to advise Moorlach and review investment policies.

A new oversight committee, meanwhile, will comprise the county chief executive officer, the auditor-controller, a representative from the Orange County Department of Education and a member of the public.

The appointment of Auditor-Controller Steve E. Lewis raised some eyebrows because he was accused by the Orange County Grand Jury last week of willful misconduct for failing to adequately oversee the county’s investment pool, which lost $1.64 billion and led to last year’s bankruptcy declaration.

“I’m not sure if the public has full trust in the individual now in that position,” Supervisor Marian Bergeson said.

The state law requires that all counties establish oversight committees responsible for an annual treasury audit.

In other developments Tuesday:

After months of contentious negotiations, officials said they are close to agreeing on the final details of a bankruptcy recovery settlement.

The committee representing the more than 200 agencies with funds in the county investment pool approved a proposal Monday and sent it to county officials for review.

“The ball is in the county’s court now,” said Irvine City Manager Paul O. Brady Jr. “They need to look at what we sent them. If it’s approved, then I think we are on our way.”

Bruce Bennett, the county’s bankruptcy attorney, said he had reviewed the proposal and didn’t have any immediate objections. “It looks good. But I want to emphasize that we have been at this point before and everything fell apart or got delayed,” Bennett said. “I’m reluctant to say the process has concluded.”

The county and pool investors have been wrangling for months on the details of the recovery settlement, which officials hope will guide the county out of bankruptcy by July.