LOS ANGELES -- Thomas W. Hayes, the director of California's Department of Finance, plans to resign on Aug. 1 to become a managing director of Metropolitan West Securities Inc., a Los Angeles-based brokerage firm.
Hayes, 47, has served in numerous government positions for 25 years. He sent his resignation letter on Wednesday to Gov. Pete Wilson, who appointed him as finance director in December 1990.
Hayes is expected to focus on international investing at Metropolitan West.
Wilson has named Russell S. Gould, 43, as Hayes' replacement. Gould is the state's health and welfare secretary and, like Hayes, is known by municipal market participants. He served as an assistant state treasurer under Hayes from 1990 to 1991, and in the state's Department of Finance under former Gov. George Deukmejian from 1983 to 1990.
In a statement, Wilson said Gould is "more than qualified" to serve as finance director because "he has been one of the state's leading experts on California's intricate system of finance."
No decision has been made on who will replace Gould as health and welfare secretary.
In a separate development, Susanne Burton, the chief deputy director in the Department of Finance, recently told Hayes of her intention to leave the post in mid-July.
Burton plans to join the Institute for Fiduciary Education in Sacramento, a nonprofit organization that conducts seminars for pension officials on financial issues.
In a letter to Hayes, Burton said the recent death of the institute's founder was a catalyst for an "impossible-to-refuse offer from the firm and for my decision to leave now. "
California's finance director oversees preparation of the governor's budget each year, and helps develop other state fiscal policies.
Hayes served as California's auditor general from 1979 to 1989, when he was appointed treasurer to fill out the term of the late Jesse M. Unruh.
Hayes, who never considered himself a politician, made his first run at elected office in November 1990 when he sought to stay in the treasurer's post, but he was defeated by Kathleen Brown.
Hayes became finance director during a tumultuous time. as California lurched into a deep recession and state budgets developed multi-billion dollar gaps. He acknowledged in his resignation letter that "the last three years have been difficult as the state has faced the most dire economic situation since the 1930s."
Nevertheless, Hayes told Wilson the period has also been one of "historic financial accomplishments" because the state closed the deficits and reduced state per capita spending for the first time in about 60 years.
"We have also restructured and reduced welfare grants in a manner that encourages employment, reduced the state bureaucracy, and started the most significant restructuring of the relationship between state and local government in the history of California," Hayes wrote in his letter of resignation.