County Wants Devereaux Lite In Next CAO

The board of supervisors’ love/hate relationship with Greg Devereaux is shaping in a multitude of ways the pending selection of his ultimate successor.
For over seven years, Devereaux, the one-time city manager of Fontana and the former city manager of Ontario, was the chief executive officer of San Bernardino County. He has only recently departed and remains as a consultant to the county on management issues.
The title and position of chief executive officer was created for Devereaux. Previously, the county’s highest ranking staff member was the county administrative officer, CAO for short, which was distinct from the title of county CEO. Devereaux came to the county in January 2010, in the immediate aftermath of the ouster of Mark Uffer as CAO in December 2009. That had occurred on 3-2 vote, with then board members Gary Ovitt, Brad Mitzelfelt and Neil Derry prevailing against then-board member Paul Biane and Josie Gonzales, the only board member from that era who is yet in place.
Devereaux was respected for his accomplishments in Fontana and Ontario. In Fontana, after a decade-and-a-half of the depredations that city had suffered during the tenure of city manager Jack Ratelle in which sales tax and property tax springbacks to developers had nearly bankrupted the city treasury, the reformist team of city manager John O’Sullivan and reformist finance manager Jim Grissom had made an effort to stabilize the situation and stemmed the giveaways to the political cronies of the city council and the mayor. But more than a decade-and-a-half of deals given to development interests had resulted in commitments that hamstrung the city financially, indeed unto the point of City Hall being crippled altogether. For example, to allow the Ten Ninety Corporation to proceed with its development of the 9,100-unit Southridge Project in the early 1980s, the city agreed to use its redevelopment agency to underwrite the full cost of infrastructure there – a $120 million price tag in 2002 dollars. This entailed $55 million in loans from the glaziers union and $65 million in bond financing in the form of “certificates of participation” not approved in a vote of Fontana citizens but rather a vote of the city council. To service this indebtedness, the city of Fontana was committed for 30 years – until 2013 – to make $3.12 million in bond payments every quarter, that is $1.04 million per month or $12.48 million per year. This deal and others like it made O’Sullivan’s task extremely difficult and in three years on the job he encountered a depth of challenges most city managers do not see in a decade. He was succeeded by Russ Carlsen as city manager, who endeavored to come to terms with the city’s overwhelming financial issues. The torch was passed from Carlsen to Jay Corey. By that time, Devereaux had been hired to serve as Fontana’s redevelopment and housing manager. Devereaux’s brilliance was in evidence at once as he grappled, exhibiting command and confidence, with the seeming intractable financial problems that had put Fontana at the bottom of a pit. When Corey left in 1993, Devereaux was elevated to city manager. In four years he not only succeeded in lifting Fontana out of the abyss, but succeeded in putting that city on firm financial footing that would persist for two decades – to the present – and which looks to remain into the foreseeable future. Under the guidance of Devereaux’s successor, Ken Hunt, Fontana moved on to become what is today – at 212,000 – San Bernardino County’s second largest city population-wise, with the third-largest municipal budget of the county’s 24 cities and the fifth most dynamic economic engine countywide. Hunt at this point is the longest continuously serving and highest paid city manager in the county and is considered to be a model for his peers. Yet it is widely recognized among his colleagues in municipal management and acknowledged by Hunt himself that his career success is largely a function of the dual factors of the advantage he possesses of having succeeded Devereaux and his own good sense of having executed on the formula that Devereaux handed off to him.
Having witnessed the dramatic turnaround in Fontana, the Ontario City Council set about luring Devereaux to Ontario in 1997, where for the next dozen years he ran that city, likewise transforming it through a variety of strategies which had for the most part not been previously utilized.
Incidental to his arrival in Ontario was the advent of the Ontario Mills shopping mall and expansions to Ontario International Airport, which were guided by the city of Los Angeles and the corporation utilized by the Los Angeles Department of Airports to run the airports Los Angeles then owned, including Los Angeles International Airport and Ontario Airport. Those resulted in substantial increases in the city of Ontario’s treasury. Far less apparent, however, were the subtle and more obscure methods that Devereaux used to boost Ontario financially, not the least of which was promoting Ontario as a point of sale for a host of corporations doing business throughout California. Through an effective but unpublicized campaign to have those corporations locate their corporate headquarters in Ontario, Devereaux was able to have the city capture sales tax revenue on the business those entities conducted throughout the state. By keeping this “point of sale” strategy quiet, Devereaux prevented other cities from catching on to the gold mine Ontario was tapping into, thereby reducing the competition the city would have had from other municipalities likewise seeking to exploit the point of sale phenomenon. By 2009, a dozen years after Devereaux had taken the helm in Ontario, the city had a total budget approaching $670 million dollars, meaning the city had more than two-thirds of a billion dollars running through all of its funds annually, such that its financial numbers were more than double that of the next most financially dynamic city is San Bernardino County.
After Uffer was sent packing in November 2009, the county made a show of carrying out a recruitment drive throughout California to replace him, which attracted 277 applications. And while 16 of those applicants were given a second look, in actuality the real action taking place was an attempt spearheaded by county supervisor Gary Ovitt to poach Devereaux from Ontario. Ovitt had been on the Ontario City Council and was mayor during the first six-and-a-half years of Devereaux’s tenure as city manager. So impressed were county officials that Devereaux was able to essentially write his own ticket. In an intense negotiation session that involved Devereaux insisting upon being given the title of chief executive officer as opposed to county administrative office, a degree of autonomy with regard to overseeing, hiring and firing county department heads that went beyond the authority of any previous county administrative officer, a salary and benefit package unparalleled in county history and a so-called superbonus, Devereaux consented to leave Ontario and become the county’s top staff member. The superbonus consisted of a provision written into his employment contract that he could not be removed as chief executive officer on anything less than four votes of the board of supervisors. Thus, the bare 3-2 majority vote that had knelled Uffer’s exodus would be insufficient to terminate Devereaux. His firing could only come if a cause was cited and a substantial number or percentage – 4 out of 5, or 80 percent of the board – agreed to force him out. He was given a ten year-contract that guaranteed he would remain as chief executive officer for five years and provided him with the option of remaining thereafter – with the board’s consent – as chief executive officer or instead transitioning into the position as “special projects” advisor. He was to be paid $319,909 in base salary as chief executive officer together with benefits that would make his total annual compensation eclipse $400,000. As special projects advisor he was to receive $91,000 per year.
His understanding of how to keep all of the moving parts of a large organization in synchronization with one another was unrivaled regionally. While delegating responsibility to department heads, he would intermittently and in some cases even constantly carry out operational control surveys that impressed upon the county’s workers that they were not only answerable, but in some fashion absolutely answerable, to him.
A significant element of Devereaux’s strength was his mastery of the financial bottom line and his ability to force the department heads below him to constrain themselves to the budget imposed on them.
More than two years prior to his coming into the position of county chief executive officer, the county, region, state and nation had been hit with an economic downturn that persisted for more than five years. Thus, the drawdown in revenue available to the county forced successive rounds of belt tightening. This resulted in sometimes testy relations with county employees and their union advocates. Immediately upon becoming chief executive officer, he had to deal with seeking and extracting the reluctant concession of the unions representing county employees to allow the freezing of salaries and reducing benefits. He carried this off but generated a degree of enmity with elements of the county’s workforce and the unions representing them.
An intrinsic part of Devereaux’s management formula is the assertion of control, indeed supercontrol. Devereaux’s absolute authority was a necessary ingredient in his success, as the margin for error and the window for achievement in the arenas in which he functioned were decidedly narrow. His plans were calculated carefully and with precision. Deviation could throw the formula into disarray. His suggestions thus became orders and his orders were exacting. To ensure compliance he sometimes used ruthless tactics. Given the stakes being played for and Devereaux’s overwhelming string of successes to say nothing of the superbonus that had been conferred upon him that made removing him extremely difficult, his political masters on the board of supervisors – who changed in 2010, changed some more in 2012 and changed in 2014 – were willing to tolerate his dictatorial manner and live with his style of having primacy in dealing with county staff and department heads, in large though not total measure cutting the board off from direct interaction with those department heads and staff.
Two major developments in recent years, however, introduced grit into the emollient that previously allowed for smooth gliding of the function between the board and the CEO.
The first was the ascendancy to the board in 2012 and 2014 of, respectively, Robert Lovingood as First District supervisor and Curt Hagman as Fourth District supervisor. Lovingood, as the owner of an employment agency, and Hagman, as a former member of the California Legislature, are strong and in some cases domineering personalities intent on interaction with those working below them in the county government structure, most particularly the echelons immediately below them at the top or near the top of the organizational chart, i.e., the county’s department heads.
The second development was the 2015 scandal that ensnared the county’s previously untouchable human resources director, Andrew Lamberto, in 2015. In the spring of that year while attending a wedding in Orange County, Lamberto was tripped up in a prostitution sting. He informed Devereaux of his citation on the offense shortly thereafter and Devereaux very privately and quietly disposed of the internal county discipline issues attending it by handling the matter administratively and not informing the board of supervisors of Lamberto’s travail. Later in the summer, however, the matter came to light publicly, and in the glare of publicity questions were asked about Devereaux’s motivation in keeping it quiet, with suggestions coming forth that doing so had provided Devereaux with some level of illegitimate leverage over Lamberto that enhanced his already dictatorial reach. While Lamberto did not survive the scandal and was given a severance from the county, Devereaux did survive, but was wounded in the outcome, creating an atmosphere in which the lines of power involving the board and the CEO subtly shifted. Over the next year-and-a-half, against this backdrop the board, or elements of it, began to move toward taking back from the CEO certain levels of authority which signaled to Devereaux that he would not have the unfettered control of the past.
On January 19 Devereaux announced he was retiring and by June would move into the post of a management consultant with the county for three years thereafter.

The use of the term love/hate is an apt one in describing the relationship between Devereaux and the board. Love is appropriate because of Devereaux’s efficiency and the manner in which he made a very large organization for which they bore some level of responsibility run relatively smoothly and in a way that was complimentary to, or at least potentially complimentary to, their own political careers and ambitions. Love because of his willingness to fall on his sword to protect them, absorb or deflect any criticism vectored their way by outsiders. But hate, or a form of it, was applicable to, because at least a few of the board members hated the way he interfered with their alpha male impulses to themselves be in control – not indirect control but direct control – of the machinery of government they headed.
At the time of the announcement, Lovingood and Hagman veiled in a velvet glove their steel-fisted determination to take grip of county government.
“I was hoping to work with Greg throughout my chairmanship,” said Lovingood, who only recently before had been promoted to the position of board chairman by his colleagues. “Greg’s knowledge and ability to work with the board to address the county’s challenges will be missed. He is well respected in the local government and business communities.”
“Greg’s contacts in Sacramento and Washington and throughout Southern California and his knowledge of government have served the board and the county well,” said Hagman. “Greg played a key role working with me and other local leaders to return Ontario International Airport to local control. As the newest member of the board, I had been looking forward to working with Greg as CEO throughout my time on the board. I am glad he will still be available to us in an advisory role.”
The board appointed Dena Smith to serve in the capacity of interim county chief executive officer. Smith had begun with the county in the human resources division, was later clerk of the board, then the head of the land use services division and subsequently an assistant chief executive officer working with Devereaux, essentially as his right hand woman. Meanwhile the county is conducting a recruitment drive to find Devereaux’s full line replacement.
It was initially disclosed that Smith had applied for the post. During this year’s board hearings for the county’s 2017-18 budget, Smith found herself filling the role Devereaux had the previous seven years, the not insubstantial task of previewing that budget. The gap between her mastery of financial issues and the skill that Devereaux exhibited in that regard was immediately obvious and as the hearings progressed, it became increasingly apparent from some of the testy exchanges that took place that the board was less than enamored with Smith’s performance. Subsequently, the Sentinel is informed, Smith took her name out of the hat for consideration for county chief executive officer/county administrative officer.
The Sentinel has learned that the balance of sentiment among the board is that the individual hired to replace Devereaux as the county’s head of operations should not be given the full range of autonomy granted to Devereaux. While the terms under which the next top county manager will be hired and will function have yet to be determined and established and will no doubt be influenced by that successful candidate’s raw talent, experience, determination and charisma, the majority of the board is leaning toward returning toward the model of the county administrative officer, which served San Bernardino County for 61 years.
Under that model, most of the county’s chief administrators were relatively long-lived in the position. The first individual to hold the post after it was created in 1948 was Tony Zenz, who stayed in place until 1958. His successor was Robert Covington, who served a record 17 years as county administrative officer, from 1959 to 1976. Earl Goodwin followed him, remaining for a relatively short four years, from 1976 to 1980. Robert Rigney stayed as county administrative officer from 1980 until 1986 and would very likely have served far longer but for the health challenges that resulted in his leaving and his death the following year. Harry Mays succeeded Rigney, outlasting his predecessor’s six year tenure by two years, staying as the county’s top dog from 1986 until 1994. Mays and his successor, James Hlawek, who remained from 1994 to 1998, are credited, or blamed, for the succession of brief tenures of the CAOs who followed, an outgrowth of the disarray that ensued from Mays’ and Hlawek’s 1998 indictments and subsequent convictions on graft, bribery and political corruption charges. Hlawek’s successor, Carol Shearer, lasted a single year, from 1998 to 1999; William Randolph succeeded her, lasting from 1999 to 2001; John Michaels stopped the gap between 2001 and 2003 and Wally Hill succeeded him, remaining in place one year, from 2003 to 2004. Hill was succeeded by Uffer, whose exodus in 2009 was followed by Devereaux’s ascendancy.
The county board of supervisors are looking to establish the level of stability and perhaps even longevity exemplified by Zenz, Covington, Rigney and Devereaux, while hoping to strike a balance between authority, efficiency functionality and oversight.
Hagman told the Sentinel this week, “We are looking at people who are willing to apply, preliminarily at this point and will become far more focused as we move to the stages where those less qualified are eliminated from consideration. There were those who applied from within the county and outside the county. This will be a fair, methodical process to find the perfect match for the citizens of San Bernardino County and the board.”
Asked if the next county staff leader will be a CEO on the order of Devereaux with a superbonus, Hagman said, “I really don’t see that as the normal trend in government. I am leaning toward the CAO model, but we have yet to see what the rest of my board colleagues think about that. From my point of view, if you lose the confidence of a majority of the board, you should move on.”
With regard to Devereaux’s tendency to insert himself between the board and county staff, Hagman said of the supervisors generally, “We each have our own staffs and district’s to manage. The CEO managed the county in its entirety. Where Greg had issues with some people, I was able to work with him. In our case, you had two strong personalities, obviously, but the CAO has to be able to deal with 20,000 plus employees and all five elected officials, all of who have their own points of view and drive.”
Hagman said that in shifting to a new county staff head and his or her license to run county operations versus the near absolute authority given to Devereaux, “It is hard to say what will be different. It will be someone who has the confidence and trust of the full board. The type of person we are looking for requires someone with what I would not call your typical lifestyle. A CAO has to be ready to receive a call at 5:30 in the morning from a board member or at 11 p.m. on a Sunday night and be responsive, as Greg was sometimes called upon to do by me. They are expected to be available 24/7 and be at their best if they’re called upon. That has to be part of their job and part of their mission in life. It is a different job from most, and some people don’t want that life.” – Mark Gutglueck

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