11:40 PM PST on Saturday, February 13, 2010

By DUANE W. GANG
The Press-Enterprise

San Bernardino County faces a $90 million budget shortfall for next fiscal year, leaving supervisors grappling with ways to overcome it. Widespread budget cuts are likely.

Starting this week, supervisors must begin adjusting to work with a new county administrative officer, his new leadership style and other possible management changes he may want.

And two supervisors are set to begin campaigns for re-election in June, asking voters for additional four-year terms.

Now, they’ll have to do all of that with a growing cloud of suspicion over the county.

The offices of the same two supervisors up for re-election were linked last week to a widespread investigation into the county’s $102 million settlement with developer Colonies Partners in 2006.

Prosecutors last week charged former Supervisor Bill Postmus and former aide Jim Erwin with more than a dozen criminal counts, including bribery and extortion.

The two — along with five unnamed and uncharged co-conspirators — are accused of participating in a scheme to use bribery and extortion to secure the votes needed to settle the county’s lengthy legal battle with Colonies.

“At the very least, it is a tremendous distraction,” Jack Pitney, a Claremont McKenna College government professor, said of the inquiry.

“The target of the investigation has to spend a lot of time with lawyers,” Pitney said. “When they aren’t spending time with lawyers, they are worrying about how to pay for the lawyers.”

So can supervisors, particularly those referenced in last week’s complaint, still effectively conduct county business?

“It’s possible to do it,” Pitney said, “but it imposes a great strain on one’s time and one’s psyche.”

The two sides had fought since 2002 over flood-control easements on the company’s 434-acre commercial and residential development in Upland.

The board approved the legal settlement in a 3-2 vote, with Postmus and supervisors Gary Ovitt and Paul Biane voting in favor. When the county finishes paying interest on the bonds used to fund the settlement, the deal will cost taxpayers more than $200 million.

The unnamed co-conspirators include a current county supervisor and the chief of staff of another current supervisor, putting those board officers directly under scrutiny.

Last week’s criminal complaint, unveiled by District Attorney Mike Ramos and Attorney General Jerry Brown, said the county supervisor and the staff chief are among the five John Does who “did unlawfully conspire together.”

Biane and Mark Kirk, chief of staff to Ovitt, appear to be the two referenced in the complaint, based on details included in court records, other public documents and statements by their offices.

While they are accused of acting unlawfully, none of the five John Does is charged with a crime. Ramos said the investigation is ongoing.

Biane, up for re-election this year, has denied wrongdoing. Kirk, through his attorney, also has denied wrongdoing.

Supervisor Josie Gonzales, not a target of the investigation, said the board faces a daunting task.

“But we are professionals,” she said. “This is not the first difficult position we have found ourselves in.”

Gonzales said board members must find common ground and continue to try to work together.

“I only have power and control over myself,” said Gonzales, who voted against the Colonies settlement. “I will make sure I have an open mind, that I am a partner wherever I can.

“We just need to let the judicial system work,” she said. “All the branches of government are in play. The DA is doing his job. The AG is doing his job. And we are doing our job.”

Supervisor Neil Derry said he won’t say the county will be doing business as usual. He said it’s “disconcerting and troubling” for multiple board offices to be involved. Some issues could be delayed, he said.

But the county has dealt with tough times before, Derry said.

“This is part and parcel of government operation,” he said. “We are always dealing with crises of one type of another.”

The new CAO, Greg Devereaux, will help the county through the difficult times, Derry said.

“We keep moving the ball forward and put it in the end zone one play at a time,” Derry said.

Ovitt, the board’s current chairman, last week issued a statement defending his vote for the Colonies settlement and supporting Kirk.

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