William G. Steiner Was an Outstanding Public Servant, With One Cautionary Tale

Commentary Orange County has lost an elected official who was a genuine gentleman. Many of us bid farewell to former Orange County Supervisor William G. Steiner Friday morning, Jan. 13, at his memorial service at the church in which he served in leadership roles, Covenant Presbyterian Church, in the city of Orange, California. We are glad that he is in heaven now; he left an amazing legacy in his focus on protecting children. And he showed fortitude in everything that he took on. It is always a good idea to say positive things about individuals at the time of their passing, but the tributes provided in the media have either not mentioned or have glossed over the elephant in the room. Former Orange County Homeless Director Karen Roper, one of the many wonderful eulogizers, did bring up the “b” word. For historical purposes, this outstanding public servant did have a missed opportunity resulting in a blemish on his otherwise amazing career. All the positive and glowing things being said about former Supervisor Steiner are deserved. He was a class act. His life also provides a cautionary tale for those interested in serving in elected leadership positions. In Steiner’s case, it was not fully playing on a hunch. When given information, there are times when one should do more than just scratch the surface or rely on patronizing assurances. Bill Steiner was appointed to the Orange County Board of Supervisors by Governor Pete Wilson in March of 1993 and elected to a four-year term in June of 1994, a monumental election cycle. He was on the Board when the most historic event in the County’s 133-year history occurred, the largest filing for Chapter 9 bankruptcy protection in United States history on Dec. 6, 1994. In a Dec. 21, 1994 piece in the Los Angeles Times titled, “Schneider Caught Up in Middle of a Maelstrom” by Dan Weikel and Matt Lait, they found that “[County Administrative Officer Ernie] Schneider’s office received a copy of an internal audit by Auditor-Controller Steven E. Lewis released in August, 1993, that assessed [Robert L. “Bob”] Citron’s performance as treasurer in 1991. Lewis concluded that Citron was bending the law to maximize returns from his investments, making risky financial deals and refusing to consult the [investment oversight] committee that Schneider sat on. The audit also was distributed to the Board of Supervisors and the district attorney. Nothing happened.” In March of 1994, I filed nomination papers to run for the countywide seat of Treasurer-Tax Collector to challenge Citron in that now infamous June election. My platform was rather simple: the incumbent was borrowing to invest. This is a very imprudent strategy for someone responsible for managing cash, especially at a time when the Federal Reserve Board was tightening interest rates. At that time, my youngest brother, Kent, was the youth director at Covenant Presbyterian Church, so Steiner was familiar with my last name. On the one occasion when we met while on the campaign trail, he was cordial, which he was famous for. He did not ask me any questions about the issues I raised but did inform me that “Mr. Citron was annoyed.” The newspaper accounts of the race were numerous. The April 2 edition of the Los Angeles Times found then Orange County Board of Supervisors Chairman Thomas F. Riley declaring both his support and ignorance about the incumbent: “This is a person who has gotten us millions of dollars. I don’t know how in the hell he does it, but he makes us all look good.” The piece, by Gebe Martinez and Kevin Johnson, included an assortment of “red flag” observations, like “aggressively handles,” “gutsy,” “hefty losses,” “complicated financial strategy,” “borrowing,” “a change in the market could turn positive returns into negatives,” and “contingency plan.” Most media accounts were by beat reporters who would emphasize that my efforts were partisan and political in nature, as Citron was a Democrat and I was a Republican. But one media outlet cut to the chase. On April 15, The Wall Street Journal, one of this nation’s leading newspapers which rarely addresses local races, had a piece titled, “Derivatives Roil California Political Race,” by Earl C. Gottschalk, Jr. Since everyone on the “Fifth Floor” seemed to be fine with this inappropriate investment strategy, I issued an 8-page detailed analysis before the election to educate the five supervisors. It received media attention at the time, phrasing my attempt as “the dying gasps” of a political opponent. The Orange County Register’s Jean O. Pasco would write about it on December 28th, 1994, in a piece titled, “Letter a road map to ruin,” stating: “The letter, dated May 31, was addressed to Orange County Board of Supervisors Chairman Thomas Riley by Costa Mesa accountant John Moorlach. It warned in exacting detail the dangers of the highly leveraged $7.4 billion pool, especially from rising interest rates, and ended with an admonition: ‘Prepare for the worst-case

William G. Steiner Was an Outstanding Public Servant, With One Cautionary Tale

Commentary

Orange County has lost an elected official who was a genuine gentleman. Many of us bid farewell to former Orange County Supervisor William G. Steiner Friday morning, Jan. 13, at his memorial service at the church in which he served in leadership roles, Covenant Presbyterian Church, in the city of Orange, California. We are glad that he is in heaven now; he left an amazing legacy in his focus on protecting children. And he showed fortitude in everything that he took on.

It is always a good idea to say positive things about individuals at the time of their passing, but the tributes provided in the media have either not mentioned or have glossed over the elephant in the room. Former Orange County Homeless Director Karen Roper, one of the many wonderful eulogizers, did bring up the “b” word. For historical purposes, this outstanding public servant did have a missed opportunity resulting in a blemish on his otherwise amazing career.

All the positive and glowing things being said about former Supervisor Steiner are deserved. He was a class act. His life also provides a cautionary tale for those interested in serving in elected leadership positions. In Steiner’s case, it was not fully playing on a hunch. When given information, there are times when one should do more than just scratch the surface or rely on patronizing assurances.

Bill Steiner was appointed to the Orange County Board of Supervisors by Governor Pete Wilson in March of 1993 and elected to a four-year term in June of 1994, a monumental election cycle. He was on the Board when the most historic event in the County’s 133-year history occurred, the largest filing for Chapter 9 bankruptcy protection in United States history on Dec. 6, 1994.

In a Dec. 21, 1994 piece in the Los Angeles Times titled, “Schneider Caught Up in Middle of a Maelstrom” by Dan Weikel and Matt Lait, they found that “[County Administrative Officer Ernie] Schneider’s office received a copy of an internal audit by Auditor-Controller Steven E. Lewis released in August, 1993, that assessed [Robert L. “Bob”] Citron’s performance as treasurer in 1991. Lewis concluded that Citron was bending the law to maximize returns from his investments, making risky financial deals and refusing to consult the [investment oversight] committee that Schneider sat on. The audit also was distributed to the Board of Supervisors and the district attorney. Nothing happened.”

In March of 1994, I filed nomination papers to run for the countywide seat of Treasurer-Tax Collector to challenge Citron in that now infamous June election. My platform was rather simple: the incumbent was borrowing to invest. This is a very imprudent strategy for someone responsible for managing cash, especially at a time when the Federal Reserve Board was tightening interest rates.

At that time, my youngest brother, Kent, was the youth director at Covenant Presbyterian Church, so Steiner was familiar with my last name. On the one occasion when we met while on the campaign trail, he was cordial, which he was famous for. He did not ask me any questions about the issues I raised but did inform me that “Mr. Citron was annoyed.”

The newspaper accounts of the race were numerous. The April 2 edition of the Los Angeles Times found then Orange County Board of Supervisors Chairman Thomas F. Riley declaring both his support and ignorance about the incumbent: “This is a person who has gotten us millions of dollars. I don’t know how in the hell he does it, but he makes us all look good.”

The piece, by Gebe Martinez and Kevin Johnson, included an assortment of “red flag” observations, like “aggressively handles,” “gutsy,” “hefty losses,” “complicated financial strategy,” “borrowing,” “a change in the market could turn positive returns into negatives,” and “contingency plan.”

Most media accounts were by beat reporters who would emphasize that my efforts were partisan and political in nature, as Citron was a Democrat and I was a Republican. But one media outlet cut to the chase. On April 15, The Wall Street Journal, one of this nation’s leading newspapers which rarely addresses local races, had a piece titled, “Derivatives Roil California Political Race,” by Earl C. Gottschalk, Jr.

Since everyone on the “Fifth Floor” seemed to be fine with this inappropriate investment strategy, I issued an 8-page detailed analysis before the election to educate the five supervisors. It received media attention at the time, phrasing my attempt as “the dying gasps” of a political opponent. The Orange County Register’s Jean O. Pasco would write about it on December 28th, 1994, in a piece titled, “Letter a road map to ruin,” stating:

“The letter, dated May 31, was addressed to Orange County Board of Supervisors Chairman Thomas Riley by Costa Mesa accountant John Moorlach. It warned in exacting detail the dangers of the highly leveraged $7.4 billion pool, especially from rising interest rates, and ended with an admonition: ‘Prepare for the worst-case scenario.’”

My missive would later become a primary document in Congressional and California State Senate hearings reviewing the bankruptcy.

Showing the complete managerial complacency at the county, Tracy Weber of the Los Angeles Times provided the details of how the Board of Supervisors approved debt issuances in her Dec. 15, 1994 piece, “Supervisors OKd Citron Requests Without Debate.” Around and after I lost to Citron in the June 8 election, the Supervisors “rubber-stamped his requests for more than $1.3 billion in borrowings from June to September.” Each request was on the consent calendar and approved “without discussion or debate.”

The Dec. 11 edition of the Los Angeles Times, in a piece titled, “What Happened to the Money?”, related that Schneider had notified Steiner on Nov. 10 that consultants were being retained to evaluate the Orange County Investment Pool (OCIP). Steiner would react by stating he “still had a feeling that Bob Citron had his arms around the problem and that he would save the day.”

It’s unfortunate that Schneider did not advise the Board of Supervisors to incur the cost of hedging the OCIP, as it would have been much cheaper than incurring the nearly $1.7 billion actual investment loss that it did.

Steiner would later reveal that he attempted to write a letter to inquire about what Citron was doing, but Schneider apparently talked him out of it. Steiner should have played on his hunch. Schneider also talked the sole Fifth District supervisorial candidate, Marian Bergeson, into withdrawing her endorsement of my candidacy, which would later haunt her with nearly every media interview. At his passing, the April 15, 2013, edition of the Los Angeles Times would not be so charitable in its headline, “Ernie Schneider dies at 66; chief administrative officer of O.C. when it declared bankruptcy.”

It was an honor to work with Supervisor Bill Steiner. He voted for my appointment to the position of Treasurer-Tax Collector on March 17, 1995 and completed his four-year term, where we collaborated with the County’s top management to assist in successfully exiting bankruptcy in 18 months. I also enjoyed working with him when I served as a county supervisor and he was a respected lobbyist. He and I would probably both agree that we should not be defined by one event that occurred in our lives.

On Dec. 21, 1994, the Orange County Register reported the tension nicely when Wieder and Riley were saying their goodbyes at the conclusion of their terms in office. Reporter Chris Knap wrote:

“Riley, 82, a former brigadier general appointed to the board in 1974, gave a farewell speech in which he blamed himself for not taking more seriously the criticisms of Costa Mesa accountant John Moorlach, who had campaigned against Treasurer Robert L. Citron this spring by warning about the dangers of the county’s leveraged investment policy.

“‘Thanks to our disposition and quality of life, we are an optimistic county with an optimistic board,’ Riley said.  ‘But that does not excuse us from listening to the pessimists.’

“‘To quote Ronald Reagan, the man who appointed me to this board 20 years ago, ‘Trust, but verify.’’”

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.

John Moorlach is a former Orange County Supervisor who most recently served as a state senator. He previously spent 12 years as Orange County’s Treasurer-Tax Collector, and led the county out of bankruptcy.