Small Town, Big Scandal

By PHIL WILLON

Oct. 17, 1999 12 AM PT

TIMES STAFF WRITER

In the “Land of Gracious Living,” as Yorba Linda calls itself, horses still have the right-of-way over cars, and kids on mountain bikes whiz by the small wooden bungalow where President Nixon was born.

Aside from the mischievous wild skunks, the city’s genteel suburban neighborhoods rarely encounter any foul distractions.

That was until a pair of special investigators rode into town this summer. Not far behind was the pungent odor of scandal; a decidedly nasty scandal laced with lawsuits, threatened recall campaigns and a political blood feud so bitter that it shut down the city treasury for a week.

At the center of it is Arthur C. Simonian, Yorba Linda’s city manager for 27 years, the mover-and-shaker who delivered the city’s crown jewel: the Richard Nixon Library & Birthplace, America’s grandest monument to a president destroyed by the dirty deeds of Watergate.

“It’s almost funny. Almost,” said Mayor John Gullixson, a Nixon loyalist and Simonian adversary.

A divided Yorba Linda City Council voted to fire Simonian in September, just hours after a special counsel disclosed the findings of an audit into Simonian’s financial dealings. The report accused Simonian of dipping into the treasury, from pocketing $14,000 in annual bonuses to billing the city for his well-equipped 1997 BMW 540i, all without the council’s full knowledge or direct approval.

Only snippets of the investigation have been made public, but they offer a startling glimpse into the fast-and-loose inner workings of this small Orange County city of 62,000 nestled in the slopes of the Chino Hills.

Simonian for years ran Yorba Linda relatively unchecked, and with unfettered access to Yorba Linda’s bank account, according to audit records and city employees.

Simonian’s Visa bills were paid directly by the city, with nary a receipt or expense report required by the finance directors who served under him. On his own, he boosted the salary and benefits of the city engineer--his close friend--by $30,000 a year. Simonian also arranged to have the city pay the $776 monthly lease on his BMW, and he billed the city for his car insurance, registration fees and repairs. Sometimes he approved the expenses himself.

“All that power in one man’s hands. He acted like a dictator, and treated the City Council like we were his subjects,” Gullixson said. “I guess he was too arrogant to think we would catch him.”

Simonian adamantly denies being involved in any financial impropriety, and said every penny he received was either approved by the council or clearly spelled out in the 1995 contract with the city, which the mayor negotiated.

The Orange County district attorney’s office agrees, and last week announced there was insufficient evidence of criminal wrongdoing to prosecute. Deputy Dist. Atty. Michael Lubinski reviewed the city audit and determined the perks in question fell within the extremely broad terms of Simonian’s contract.

The city’s special counsel, Henry R. Kraft, still plans to take civil action against Simonian to recoup what the city alleges was close to $200,000 in unapproved compensation pocketed by the former city manager.

Simonian may also face tax difficulties. The city has alleged that Simonian intentionally did not declare all of his income to state and federal tax authorities, an allegation that “may have merit,” Lubinski said. The IRS already has discussed the case with city officials. Simonian said that if all of the income was not reported the city was to blame.

Simonian insists this is a simple tale of power and politics; not bonuses and BMWs.

“It’s nothing more than a witch hunt, and wild accusations from a man trying to disparage me,” Simonian said, referring to Gullixson, his former boss. “I think it comes out of the mouth of an idiot.”

That dose of venom pales compared to some of slanderous personal accusations ricocheting around the City Council, where the four current members are split evenly on Simonian. Nothing has been off-limits.

Less than a mile from the poisoned air inside City Hall, at the end of a long, winding gravel road, lives a very disappointed Herb Warren. The retired citrus grower served on Yorba Linda’s first city council when it incorporated in 1967, and he’s never seen such a mean-spirited scandal infest his beloved hometown.

“It’s childish, and I’ve been disappointed by both sides,” said Warren, 72, a Yorba Linda resident since 1923. “It’s tearing the city up, there’s no doubt about it.”

Before this summer, Warren said, Yorba Linda suffered few distasteful controversies.

Even when Nixon retreated back to California after Watergate, Yorba Linda didn’t abandon its tarnished native son. The city embraced the 37th president. Nixon’s Jan. 9 birthday was declared a city holiday. And Yorba Linda waged an aggressive campaign to land the Nixon Library, snatching it away from San Clemente, home to Nixon’s “Western White House.”

“I was never a real Nixon person, but he was good to us,” said Warren, who once did carpentry work in a local general store owned by Nixon’s father. “Who would have ever heard of Yorba Linda if it wasn’t for Nixon? The only time we were mentioned was in the frost reports.”

Because Nixon’s memory has been so intertwined with the image of the city, it wasn’t too much of a surprise when his name was dragged into the middle of Yorba Linda’s current political bloodletting.

The Nixon Library’s executive director, John Taylor, has publicly vouched for Simonian’s integrity, and said the center would never have been built in Yorba Linda if not for Simonian’s dogged lobbying.

“He’s an indispensable friend of the Nixon library,” Taylor said. “He’s a personal friend of mine.”

Taylor has agreed to open the library’s doors for Simonian’s legal defense fund-raiser. Simonian is, Taylor said, the unwitting victim of his political enemies on the City Council.

Simonian has friends on the council too: Hank Wedaa and Mark Schwing, who have been two of Simonian’s staunchest defenders these past two months.

Wedaa said Simonian’s downfall was orchestrated by the politically ambitious mayor, who has harbored a deep simmering jealousy of the city manager’s prestige and fat paycheck. Gullixson wants to run for the state assembly, Wedaa claims, and is doing everything he can to grab headlines.

“Gullixson is a schoolyard bully who never grew up,” Wedaa said. “This is politics at its very dirtiest worst, and it is strictly for the political gain of one individual.”

Gullixson brushed aside Wedaa’s comments and said any plans he may have had for higher office have been put on hold while the city deals with the Simonian scandal. He added that he had a good working relationship with the former city manager up until he learned Simonian was pocketing thousands of dollars without council approval.

“No matter how much they whine and scream, Art Simonian is never coming back. The facts are just too devastating against him,” said Gullixson, a Yorba Linda attorney specializing in family and personal injury law.

The political climate at City Hall began to sour in the early 1990s, with the controversial proposal to widen the Imperial Highway, a main artery cutting through downtown Yorba Linda and connecting the Riverside and Orange freeways.

Gullixson and council members Barbara Kiley and Gene Wisner supported the project, saying it would ease traffic and help local businesses. Wedaa opposed the project, and Schwing opted to leave the issue up to the voters.

The Sept. 7 vote to fire Simonian, championed by Gullixson, broke along the exact same lines. The mayor, Kiley and Wisner voted in favor, and Wedaa and Schwing opposed. But this vote was unique. Wisner had already announced he was retiring to Michigan and stepping down from the council--but postponed his moved until the day after the vote to fire Simonian.

“The gang of three stuck together until the bitter end. It was an outrage,” Wedaa said.

With Wisner gone, the council is down to four. That has created havoc, because the council needs a majority to approve any measure before them. Last week, the council split 2 to 2 on a proposal to pay the attorneys who investigated Simonian--locking up the city treasury and preventing the city from paying its bill. The matter was resolved a week later, and employees were paid on time.

Still, in Yorba Linda’s well-clipped neighborhoods, the intricacies of City Hall rarely crack through the hustle-and-bustle of kids, long commutes and other routines of suburban life.

Connie Anderson, who was watching her daughter’s soccer practice on a field bordering City Hall one recent afternoon, said she hasn’t paid too much attention to the controversy. Yorba Linda has evolved into a nice, modern city and, with its good schools and low crime, a wonderful place to raise a family, she said. Her only concern is that the city is becoming too city and less country.

“It has a rural feel, but it can also be the kind of place where everyone gets uptight if your dog isn’t on a leash,” said Anderson, 43.

Bruce Carlson, 59, credits Simonian for preserving Yorba Linda’s rural and suburban charms, from the dusty horse trails and exquisitely landscaped roadways to the city’s upscale, airy neighborhoods. Still, he was upset when he read about Simonian giving himself such a large bonus without a council vote.

“That Simonian guy was in a position of public trust, and he abused it,” said Carlson, who was at the city’s Buena Vista Equestrian Park exercising two impressive steeds.

Carlson can’t understand why no one was watching over Simonian, even if he had served faithfully for more than a quarter century.

“Most of your bad horses have been made that way. They’ve been allowed to do things they shouldn’t have been allowed to do,” Carlson said. “This thing with the city manager isn’t too different. The City Council should have been on top of it.”

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

City Manager Perks

After 27 years as Yorba Linda’s city manager, Arthur Simonian was fired by the city council in September after special investigators alleged that, for years, he had awarded himself bonuses and billed the city for questionable expenses, including his car insurance. Simonian denies the allegations, and is suing the city from wrongful dismissal. The IRS is reviewing the case, but Orange County prosecutors determined there was insufficient evidence of criminal wrongdoing.

Yorba Linda City Manager

Simonian’s compensation in 1998-99

Salary: $142,116

Car: 1997 BMW 540i

Lease @ $776.68 a month.........$9,320

Auto insurance....................$976

Registration......................$961

Repairs & Maintenance.............$118

Gasoline........................$1,745

Total: $13,120

Insurance & Retirement benefits

Medical, dental, life,