County Will Pay Legal Fees for Indicted Officials

The two Orange County supervisors and auditor-controller accused of misconduct in the county’s bankruptcy will have their legal bills paid by the taxpayers, the three remaining supervisors decided Wednesday.

The county will pick up the tab for the legal defense of Board Chairman Roger R. Stanton, Supervisor William G. Steiner and Auditor-Controller Steve E. Lewis. An Orange County grand jury last week charged the three with neglecting their duties in allowing the bankruptcy to happen.

Neither Stanton nor Steiner took part in Wednesday’s vote. The three remaining supervisors--Marian Bergeson, Don Saltarelli and Jim Silva--voted unanimously to pay for the trio’s legal defense. Fearful of big bills, they asked the county’s chief executive, Jan Mittermeier, to draw up a plan to limit expenses.

“The issue really boils down to one of accountability and the stature of elected officials,” Bergeson said. “I think it would have a chilling effect on those who would have to weigh every decision based on what might happen two years from now.”

The supervisors set no ceilings on total legal expenses, but gave Mittermeier 30 days to come up with the plan. They won’t start paying any bills until it’s ready.

The supervisors also stressed that none of the three had been charged with a crime, but merely with civil infractions. The county has thus far refused to pay legal bills for anyone charged with crimes.

The total cost of defending Steiner, Stanton and Lewis could run to well over $1 million. The three could avoid their legal battles altogether by stepping down. But they all have indicated that they would prefer to stay--provided the county pays for their lawyers.

Fewer than 40 people attended Wednesday’s meeting, including several members of the grand jury, who sat in a back row silently observing the proceeding. Even fewer spoke.

The sparse crowd contrasted sharply with the flurry of telephone calls supervisors received from voters venting their opinions. Most of the callers, supervisors said, spoke against paying the bills. At Wednesday’s hearing, not one speaker took that position.

“I reluctantly support the decision,” said Bob Bennyhoff of Orange Park Acres. “But I don’t like it.”

Afterward, some Orange County residents vented their frustration. Arturo Montez of the League of United Latin American Citizens denounced the supervisors’ vote. He said the decision could prompt elected officials who misbehave in the future to send their legal bills to the taxpayers.

Said Montez: “It takes a fair amount of chutzpah to, first, snooze your way through the largest municipal bankruptcy in history, be indicted while stubbornly remaining in office for your costly negligence of leadership, and then ask that the taxpayers write your lawyer a blank check to cover your defense.”

Attorneys representing Stanton and Steiner applauded Wednesday’s vote.

“This was a major first step,” said Wylie A. Aitken, who represents Stanton, lauding the board for its “sense of fairness.”

Aitken added, “Supervisor Stanton and I would love to save the taxpayers money, but that’s not totally within our control. That’s up to the district attorney.”

As an example, he said the district attorney’s office sent him a bill for $11,000 for copies of documents and audio and videotapes.

“We’re gratified that the board has seen fit to stand behind Mr. Steiner,” said Allan H. Stokke, his lawyer. “There are many situations where false accusations are made and where a person cannot obtain proper legal representation and this now allows Mr. Steiner to defend himself on these false allegations.”

“We are pleased that the board would approve the defense of Mr. Lewis,” said Brian Sun, Lewis’ attorney. “It’s the right thing to do because we think the accusation is meritless, unfounded and we expect Mr. Lewis to be exonerated.”

To authorize the payments, the three sitting supervisors had to determine that the acts for which Steiner, Stanton and Lewis are charged were committed in the performance of their public duties, that the three acted in good faith, or that it was in the best interests of the county to pay for their defense.

The three supervisors stated repeatedly that they wanted to hold down costs as best they could. They spoke of possibly capping attorneys’ fees or even rejecting some bills if they get too high. To date, taxpayers have been billed almost to $30 million in bankruptcy-related costs.

“We’re paying for both sides of this fight,” Bergeson said after the meeting. “We need to have some limits.”

At the same time, the supervisors agreed to consider paying even more bills. Former county Finance Director Eileen Walsh told the supervisors that she has incurred thousands of dollars in legal bills that the county has so far declined to reimburse.

Walsh has not been charged with any crime but, like many county employees, she has been summoned to appear before the U.S. attorney’s office, the federal grand jury in Los Angeles and the district attorney’s office.

“I have not been charged with misconduct, nor have I been indicted on any criminal charges,” said Walsh, her voice trembling. “I have been assured continuously since February 1995 that I am not a target of criminal investigations. The county nonetheless has chosen to ignore its responsibility for defending me.”

Walsh continued: “Please consider the chilling effect and the sense of betrayal that a refusal to defend innocent employees has on county employees like myself who struggled to protect the interests of residents and taxpayers.”

The supervisors agreed to consider Walsh’s request and any other cases where county employees have incurred legal costs.

Saltarelli used the occasion to denounce both Dist. Atty. Michael R. Capizzi, whose office investigated the bankruptcy, and the grand jury that brought the charges. Saltarelli suggested the grand jury abused its authority by seeking to remove Steiner, Stanton and Lewis without bringing criminal charges against any of them.

“This is a democracy,” Saltarelli said, “Only the voters decide who is elected to office . . . and only the voters should try to remove them, unless they’re indicted for the commission of a crime.

Saltarelli criticized the charges as “selective prosecution,” noting that the other supervisors in office at the same time had the same responsibilities and yet were not accused.

Finally, Saltarelli said, “this puts the grand jury in the same position as that which they accuse the supervisors of, and that is wasting taxpayers’ money.”

Chief Executive Officer Mittermeier told the board that any legal fees would ultimately be charged to the risk management fund, the county’s self-insurance pool, which currently contains about $60 million.