Schools Chief Ends Era on Low Note : Education: Newport-Mesa district superintendent John Nicoll says it was illness, and not the largest school-system embezzlement in state history, that prompted his retirement after two decades.

NEWPORT BEACH —  When John W. Nicoll became superintendent of a unified school district for the first time in 1959, he was California’s youngest. Now he is the oldest.

Since 1971, Nicoll has stood at the helm of the Newport-Mesa Unified School District, a place once famous statewide for its innovative programming and the financial means to make it work.

Now, the Newport-Mesa district is infamous across the state for another financial matter--the largest school-system embezzlement in California history.

As Nicoll, 71, prepares to retire this spring, parents and teachers outraged over the embezzlement are rejoicing in his resignation. But school board members and fellow administrators warn that replacing him will be a challenge. The seven-member school board hopes to pick an interim superintendent this week and name a permanent replacement by June.

“He hasn’t always been a popular superintendent, but I don’t think that popularity and greatness always go hand in hand. I do think he’s been a great superintendent,” said Sherry Loofbourrow, a member of the school board since 1981.

Most school superintendents survive only four or five years before they are forced to move on. But Nicoll once joked that he would not step down from his post until his grandson and namesake was ready to replace him. Any dreams of a dynasty, however, were dashed by the bleeding ulcer that doctors diagnosed last month after Nicoll underwent quadruple bypass surgery.

“The only reason I am leaving the profession I love so much is because people say if I don’t get out of it I’m liable to kill myself,” he said in a recent interview at district offices.

Since the discovery this past fall that the school district’s top finance officer, Stephen A. Wagner, looted nearly $4 million from district accounts, parents and teachers have questioned Nicoll’s management of the district and publicly demanded his ouster. Nicoll insists, however, that the Wagner debacle has nothing to do with his decision to step down.

“I’m accustomed to pressure; I welcome it,” he said, recalling the general campus unrest in the late 1960s, when, as head of the schools in Vallejo, Calif., he carried a gun and occasionally required a police escort. “I’ve always been interested in the combative side of public life.”

Combative is a common word in conversations about Nicoll, who is known in the district’s central administration as a “lovable porcupine.”

An Air Force veteran, Nicoll often employs military metaphors, and admits a fondness for a good fight. Supporters say he is a strong-willed leader; detractors use the word dictator.

Colleagues and community residents laud Nicoll for his intellect and integrity, but blast him for being brash, brusque, aloof and arrogant. He rarely socializes, has few close friends on the staff and limits his community involvement to membership on the Orange County Sheriff’s Advisory Council and chairmanship of Newport Beach’s library board.

One-on-one, he is charming; in groups, his sarcastic wit is sometimes seen as condescending.

“I’m perceived by a lot of people as being some kind of an ogre,” he said. “I detest small talk. I put the job first, above personal relationships. That doesn’t necessarily lead to warm fuzzies.”

A slender but solid 6 foot 1, the silver-haired Nicoll has an intelligence quotient that hovers around genius level.

A literate and literary man, Nicoll’s booming voice, erudite vocabulary and frequent quotations from famous authors sometimes alienate co-workers and community residents.

“If he disagreed with you, he had the . . . (habit) of criticizing the verb you just used to put you on the defensive, and then he’d win the day,” said Karen Evarts, who called for the superintendent’s termination during her unsuccessful bid for a seat on the school board in 1989.

But Nicoll shrugs off concerns that he is out of touch with rank-and-file employees, and brushes aside criticism that he has closed the lines of communication for concerned parents. He says he is “one hell of a communicator,” admitting “a tendency to wander into excessively long words . . . because I love the language so much.”

Nicoll’s 21-year reign in Newport-Mesa was partly blighted by battles with the teachers’ union over wages and layoffs, continual clashes with parents over the necessary closings of some neighborhood schools, and public-relations gaffes attributed to Nicoll’s stubborn and imperious ways.

Aside from the usual contract issues, teachers also fault Nicoll for devoting too much attention and resources to administration, and not caring about--or understanding--what goes on in the classroom. Some years back, after complaints about the sex education curriculum from the religious right, he incensed instructors by banning gay guest speakers and ordering cancellation of a provocative lecture.

“Dr. Nicoll gave me the impression that teachers were a nuisance . . . one of life’s unpleasantries,” said James Rogers, a 23-year veteran teacher of the district. “The general attitude was that we were just a bunch of children that had to take orders.”

Under Nicoll, some teachers complain, Newport-Mesa was run by an oligarchy of trusted high school principals and a 10-member cabinet that included Wagner, the embezzler.

“When he hired somebody, he’d essentially say, ‘OK, this is (yours), go to it,’ ” said Michael Murphy, a district graduate who is now principal of Costa Mesa High School. “Unless there were some real problems, he would just let you do your thing.”

And in the wake of the Wagner scandal, some in the community are outraged that Wagner was allowed to operate without a system of controls that should have prevented the embezzlement.

Nicoll, however, blames the scandal on misplaced trust rather than any systemic management problem. As superintendent, he accepts abstract responsibility for everything that happens in the district. But he disagrees with those who believe Wagner’s crimes are grounds to dismiss Wagner’s superiors.

“He simply was a very smart man who was in a position of trust and thoroughly abused it,” Nicoll said of the man he promoted from accounting clerk to top financial officer over a stretch of 20 years. “I am saddened by that, but a thief’s a thief.”

Before the embezzlement, Nicoll’s darkest hour came when he swapped the much-loved principals of Newport Beach’s rival high schools--Newport-Harbor and Corona del Mar. Hundreds of parents protested at board meetings, and more than 1,000 students stormed out of school for a protest rally outside Nicoll’s office.

Looking back, Nicoll said he would still have made the switch--though he did not then and would not now offer any particular reason--but would have handled it “more delicately.”

While distant from individual employees and the community in general, Nicoll had a snug relationship with the 45 school board members who served as his bosses over the years. Indeed, several board candidates who campaigned to unseat him later became his biggest boosters.

“Maybe what you originally perceived as combativeness you begin to see as strength,” explained Tom Williams, who was elected to the board in 1983 after doing battle with Nicoll over proposals to combine junior and senior high schools. “As you approach problem after problem after problem, the guy knows 100 times more about the issues than anybody else you talk to. Because of that you develop a respect for the man.”

But with public meetings characterized by 7-0 votes and smooth, seemingly rehearsed banter between staff and school board members, the trustees have long been accused of letting Nicoll run the district with too free a hand, giving rubber-stamp approval of his activities and decisions.

Board members, however, say their uncommonly harmonious meetings represent good planning, not blind faith in the superintendent. Decisions are hashed out and compromises forged in private so the district can present a united front.

“There aren’t any surprises” at the meetings, Nicoll agrees. “By the time we get around to an item on the agenda, hours and hours of conversation and work has gone into it, and it looks like a rubber stamp. . . . What kind of stupid superintendent would I be if I took to the board things I knew they were going to reject?”

With a national reputation as a fiscal wizard and a pioneer in educational programs for teachers and students, Nicoll is seen by peers as the “dean” of superintendents.

In 1989 a magazine for educators placed him among North America’s 100 “best and brightest” school executives, and he currently heads a statewide group of 70 district leaders concerned about financial matters, and an exclusive group of 20 Southern California school chiefs.

As John F. Dean, Orange County’s superintendent of schools, put it: “When John Nicoll spoke, the superintendents listened.”

After a brief stint in the classroom--just long enough to qualify for an administrative position--Nicoll quickly scooted up the ladder in the Pacific Grove Unified School District, becoming its superintendent in 1959. He left for a doctoral fellowship at Columbia University, headed a high school district in New York and then returned to California to lead the Vallejo district.

In 1971, he accepted the Newport-Mesa post, a nationally coveted spot because of the district’s wealth and reputation for excellence. In the two decades since, tremendous change has come about. Where the district had 26,500 students, 99% white, attending 40 schools, today there are 17,447 students, just under 64% white, in 25 schools.

His first year’s salary was $31,000; in 1992-93 it was $106,747.

Colleagues praise Nicoll for bringing technology to the classroom, launching a mentor teaching program, implementing competency-based testing for students, and using continuing education to determine teacher pay scales.

Ironically, Nicoll’s strongest area has always been school finance--the area that has tarnished the twilight of his career.

He negotiated a lucrative deal with the Irvine Co. to help the district handle new development in its southern, coastal tip, and reaped income for the schools by selling the rights to subterranean water beneath school properties.

His lobbying in Sacramento and Washington led to numerous special grants, including one that snuck through a loophole in a mid-1970s poverty program and gave Newport-Mesa--hardly an impoverished district--the $2.5 million that renovated an auditorium at one high school and built a girls’ gymnasium at another.

For Nicoll, the greatest triumph was keeping budgets in balance despite declining revenue; the greatest tragedy, of course, the embezzlement that began at least six years ago.

As he fondled the “keys to the kingdom,” three rings holding two dozen keys that open every door in every school, Nicoll recalled the thrill of prowling his campuses at night and on weekends. After methodically inspecting classrooms, locker rooms and restrooms, he would sometimes leave a note with his observations on the principal’s desk.

“You can worry about a stopped-up toilet or whether to close a school or whether to keep Latin in the curriculum or how better to teach about AIDS,” Nicoll said to explain his love for the superintendent’s seat. “Every phone call can be a different thing.

“Every damned day of it has been great,” he said, his clear blue eyes glancing up, glossing over. “I hate to leave it, frankly.”

Newport-Mesa as John Nicolli Leaves

District at a Glance Founded:1966 Enrollment: 17,447 Schools: 17 elementary schools 4 regular high schools 2 intermediate schools 1 alternative education center 1 primary center

Ethnic breakdown of students (1992-93) Anglo: 64% Latino: 27% Asian: 7% Black: 1% Others: 1%

Employees 747 teachers, nurses, psychologists, librarians 753 custodial, clerical, cafeteria, maintenance, transportation workers and other support staff 64 administrators Per-pupil expenditures: $4,880 (Calif. $4,660; U.S. $5,629) Average teacher salary (excluding benefits): $44,212

Operating budget: $78 million

Recent layoffs 33 teachers and 22 temporary teachers, end of 1991-92 school year 7.5 administrative positions, end of 1991-92 school year 47 classified positions, January, 1992 124 classified positions, June, 1992 57 classified positions, July, 1992

Expenditures Salaries for certificated employees: 49% Salaries for classified employees: 19% Employee benefits: 18% Other: 14%

Budget sources* Property taxes: 70% State funds**: 14% Other local taxes: 10% Other local income: 3% Federal funds: 3% * Projections ** Includes grants for materials, teachers, and special programs

District’s cities NEWPORT BEACH Population: 66,643 Ages 5-17: 6,312 Median income: $60,374 School attendance (elementary/high school): Public: 80.1% Private: 19.9% COSTA MESA Population: 96,357 Ages 5-17: 12,264 Median income: $40,313 School attendance (elementary/high school): Public: 86.4% Private: 13.6%

Sources: Newport-Mesa Unified School District; U.S. Census (1990); U.S. Department of Education; Orange County Department of Education; Researched by JODI WILGOREN / Los Angeles Times