The longtime executive officer of the embattled California Board of Registered Nursing resigned Tuesday, ensuring almost entirely new leadership for the agency as it strives to revamp its oversight of hundreds of thousands of caregivers.

But the sweeping reforms promised by Gov. Arnold Schwarzenegger this week face significant obstacles – not the least of which are the governor's own budgetary gambits and his failure to fill key vacancies in his administration.

One day after Schwarzenegger replaced more than half of the panel, citing "absolutely unacceptable" delays in the discipline of wayward nurses, the board's top executive of nearly 16 years sent a one paragraph e-mail to her staff.

"It is with much sadness that I am resigning my position as executive officer of the Board of Registered Nursing," Ruth Ann Terry wrote. "All of you are the greatest staff and I know that you will continue carrying out the mission of the board."

Terry, who earned $114,000 a year, hung up on a reporter seeking comment Tuesday. In an interview last week, she agreed that the disciplinary process needed streamlining, but blamed delays on other branches of the state bureaucracy.

The near-gutting of the nine-member board occurred after the Los Angeles Times and ProPublica published an investigation Sunday showing that it takes the board an average of three years and five months to investigate and close complaints against nurses – leaving many to practice with clean records in the interim.

Reporters found nurses who worked unrestricted for years despite documented histories of incompetence, violence, criminal convictions and drug thefts or abuse. Employers were often unaware of their histories, and some patients were injured or died as a result of poor care.

"The governor was not aware of the full extent of the problems until he read it in the paper," said Rachel Cameron, a Schwarzenegger spokeswoman. "Once he confirmed the findings, he took immediate action."

On Monday, the governor abruptly replaced four board members and filled two vacancies, saying in a statement that his new panel would move "quickly and decisively" (there is still one vacancy on the board). He will swear in the new members today.

"It's fair to say the governor would accept nothing short of perfect performance from the new board," said Victoria Bradshaw, his Cabinet secretary, on Tuesday. "Incremental improvement on a broken system is not what the governor is looking for."

But the new panel will face steep challenges.

For example, Schwarzenegger has not exempted the board (or other licensing agencies) from mandated staff furloughs and contract cutbacks – even though the nursing board is entirely supported by the fees it charges for licenses and is not dependent on the state's strapped general fund.

State Sen. Gloria Negrete McLeod (D-Chino), chairwoman of the Senate Business and Professions Committee, called Tuesday for the governor to rescind his executive order requiring furloughs for employees of self-supporting boards that "oversee the health and safety of the public."

Shutting down the boards three Fridays a month "inhibits the consumer protection activities of the boards and further slows the enforcement process down, and is completely unnecessary to resolving any of the state's budget problems," she said in a news release.

But Cameron said the governor has no plans to change course on furloughs or other cost-saving measures, regardless of how boards are funded. "The state has a cash crisis," she said. "We have to do more with less."

Other actions – or inaction – by the Schwarzenegger administration could also hamper the board. The governor has not filled openings in the top two posts at the Department of Consumer Affairs, which oversees roughly 40 boards and bureaus regulating acupuncturists, veterinarians and other licensed professionals.

And Schwarzenegger has not announced steps to decrease the backlogs in agencies that the nursing board and other regulators rely on for investigative and legal help. At present, more than 20% of the investigator positions in the Consumer Affairs Department, which looks into most complaints filed with the nursing board, are vacant.

The cuts put in place by the governor "are simply strangling those agencies in terms of being able to promptly do their job," said Julianne D'Angelo Fellmeth, administrative director of the Center for Public Interest Law at the University of San Diego, which monitors the state's boards and bureaus.

Bonnie Castillo, director of government relations for the California Nurses Assn., a union that has long feuded with the governor, said she worried that replacing the board was a superficial move that would detract from more meaningful reforms. "We need this problem fixed," she said. "We don't need a witch hunt or scapegoats."

Susanne Phillips, fired by the governor as board president Monday, echoed that concern. She said Schwarzenegger simply found "scapegoats for a system that is flawed."

Replacing board members, she said, will not make the delays in discipline go away.

"We didn't sit on our butts and ignore that people are suffering," she said. "That's a ridiculous notion."

Up until a few days ago, the administration communicated little concern or sense of urgency about the nursing board.

Just last week, Fred Aguiar, the governor's secretary of state and consumer services, declined to talk to reporters about their investigative findings. His agency oversees both the Department of Consumer Affairs and the nursing board.

Instead, the state made available the acting chief deputy director of the Consumer Affairs Department, who said that she felt the board "did a good job" and that she had a "partnership" with Terry.

On Monday, Aguiar offered an entirely different message, saying that the disciplinary process needed an overhaul and that the new board would need to quickly come up with a plan to accomplish that goal. The board will hold its first meeting later this month, his spokeswoman said Tuesday.

Ann Boynton, one of the six new members appointed to the board Monday, said she had not yet received a detailed briefing on the board and couldn't predict the magnitude of needed changes.

"Clearly the governor found the circumstances within the board were not adequate to protect public safety and to ensure that vulnerable Californians are cared for at the time they most need it," said Boynton, a consultant who was undersecretary for the state Health and Human Services Agency from 2006 to 2008.

"He believes serious change is necessary," she said. "We will investigate what those changes need to be."

In this video recently posted to the board's website (before our investigation was published), Terry talks about the board's role in overseeing nurses:

Previously: Schwarzenegger Replaces Most of Nursing Board and Problem Nurses Stay on the Job as Patients Suffer. The homepage for our ongoing investigation is here.