City Manager Strikes Back

Amid accusations that he secretly rewarded himself with cash bonuses, Yorba Linda’s longtime city manager lashed back Thursday, saying council members had never questioned the city’s 12-year-old incentive program that pays top managers 10% of their salaries each year.

Quite the contrary, said City Manager Arthur C. Simonian: Council members approved the payments year after year.

“Where have they been?” Simonian asked. “They negotiated and approved my contract; they adopted the salary resolutions each year.”

A divided council voted earlier this week to suspend Simonian after a tumultuous closed-door discussion over the details of his $200,000-a-year compensation package.

Several council members said they had no idea Simonian paid himself a cash bonus of about $14,000 each year. Nor were they aware that he lavished top staffers with comparable lump-sum bonuses that sometimes equaled 10% of their annual salary.

Instead, Yorba Linda Mayor John Gullixson charged that Simonian--Orange County’s longest-serving city manager, who began running Yorba Linda in 1972--has been less than candid about his compensation in documents presented to the council in the past.

“I would always ask, ‘Is this everything? Are there any other benefits?’ ” Gullixson said, recalling the city’s annual budget ritual. “I have always trusted him.”

Simonian said there have been no financial improprieties.

“I want to be very clear that there is none, and there has been none,” Simonian said in a written statement.

The manager’s contract, approved in 1995, says Simonian is entitled to an annual salary, cost-of-living increases, a $535-a-month car allowance, a $1-million life insurance policy, vacation, health insurance and retirement plans and any other benefit extended to “all other management and mid-management employees.”

That includes the cash bonuses, which are part of the “management incentive program.”

“All of the personnel costs, all of the salaries and all of the perks are in the budget approved by the City Council,” added Councilman Mark Schwing, who voted against placing Simonian on a paid leave of absence.

“We’re not talking about something that is off budget,” Schwing said.

Simonian has hired an attorney. He issued the statement Thursday, calling the council’s 3-2 vote to suspend him “clumsy at best.” He said he’s had only one performance evaluation in his 27 years on the job, and expressed sadness that council members have “chosen to publicly besmirch my reputation.”

The 57-year-old city manager said he’s not sure what his next step will be.

“I don’t know what I plan to do,” Simonian said. “I have a reputation that I’m proud of, and I will do whatever is necessary to protect it.”

He compared the situation to a messy divorce.

“This is about who will manage the money, who will mow the lawn, who takes out the trash,” Simonian said, adding that if a majority of the council wants to fire him, then so be it. He’s served for nearly three decades as city manager, an occupation where the average tenure is just 6 1/2 years.

“I’ve probably had a better run than most,” Simonian said. “If they want to terminate me, if they say, ‘Hey we don’t like the way you part your hair anymore,’ then I don’t have a problem with it.”

Thursday night, council members voted to hire their own attorney, Henry R. Kraft of the Tustin law firm of Parker, Covert and Chidester. They also discussed hiring a separate accounting firm to come in and scour the books.

“As far as the audit goes, we may find more information than we previously thought,” Gullixson said.

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Gullixson brought the issue to a head by insisting on a detailed accounting of Simonian’s compensation package two months ago. During a contentious budget briefing, Gullixson demanded five years of financial information, including Simonian’s federal W-2 forms.

“The reaction was overt. And the reaction was to stonewall me,” Gullixson said.

The documents Gullixson demanded were distributed Aug. 2. Spreadsheets, covering the past three years, showed the salary and benefit costs for Simonian and his seven top department directors.

“None of us were aware that Mr. Simonian was paying bonuses to his employees,” Gullixson said. “That information was deleted from our budgets.”

Schwing said he is distressed by Simonian’s public flogging. The smear campaign was nothing more than politics, he charged.

This week’s turmoil is simply a harbinger of more upheaval to come in Yorba Linda. In three weeks, Councilman Gene Wisner--the top vote-getter in last November’s city elections--will step off the dais and move back to Michigan.

Wisner’s departure will leave the contentious council split down the middle--with two council members in one camp, and two in another.

“And that means nothing will happen,” Schwing predicted.