STORY CORRECTED: An earlier version of this story incorrectly stated that the grand jury named Robert Graf among the attendees of breakfast meetings that may have violated the state's Sunshine Act.

Montgomery County's board of commissioners fired their chief attorney Wednesday and promised a review of all county departments in response to a scathing grand jury report and the arrest of their former chairman James R. Matthews.

Commissioners Joseph M. Hoeffel III, a Democrat, and Bruce L. Castor Jr., a Republican, told a capacity crowd that the county's top administrators would review all allegations and make recommendations for reforms next week.

Their comments came at their first public meeting since Matthews was taken into custody Tuesday on perjury charges.

But despite a vow to serve out his term as a regular voting member of the board, Matthews, a Republican, did not attend Wednesday's meeting.

Matthews declined to comment when contacted at his business, Keegan Mortgage, saying his attorney was seeking a gag order in the case.

"Yesterday was a sad day for Montgomery County, but today is a new day," said Hoeffel, who was named commissioner's chairman Wednesday in Matthews' stead. "The county commissioners recognize the need to refocus on the important work of government ahead."

Whether that future should include Matthews, the two remaining commissioners declined to say.

"That's a decision he has to make on his own," said Castor, who has made no secret of his contempt for Matthews since the latter man teamed up with Hoeffel in 2007 to edge Castor out of government control.

"If I were to suggest what (Matthews) should do, he might just do the opposite to spite me," Castor said.

Prosecutors allege Matthews lied in October to a grand jury investigating public corruption about his prior relationship with a Fort Washington title company that received contracts for government work. He has denied the charges and characterized the investigation as a political witch-hunt

But the 69-page grand jury report unsealed Tuesday went further - painting an unflattering portrait of the government of Pennsylvania's third largest county. Too often, it said, Montgomery County's officials and civil servants ignored their own procurement policies, recklessly spent taxpayer money and rewarded political cronies with plum positions for which they were unqualified.

While Matthews was steering the ship, a handful of other county employees - including Solicitor Barry Miller - were caught in the grand jury's dragnet. None, other than Matthews, face criminal charges.

Miller served as Matthews' campaign manager during the 2007 race. Castor has said previously that his refusal to support Millers's appointment as solicitor led to Matthews' forming his controversial alliance with Hoeffel.

But according to the grand jury's report, Miller - whose job it was to advise commissioners on legal matters - often operated as an enforcer making sure county employees made decisions on contracts in line with Matthews' will.

In one example cited by the panel, Miller purportedly told a committee assigned to review bids that the Ohio-based firm CBIZ needed to be awarded a contract to regulate health insurance for county personnel.

CBIZ donated thousands of dollars to Matthews' 2007 candidacy - contributions Miller collected in his role with the campaign.

In light of those allegations, firing Miller was the only acceptable choice, Hoeffel said Wednesday. He and Castor appointed James W. Maza, formerly the county's deputy chief operating officer, to replace him.

Miller did not respond to calls for comment.

The commissioners declined to specifically discuss the future of other county employees mentioned in the grand jury's report.

The panel declared Human Resources Director Eleanor Schneider "not qualified for a position of such importance" based on her purported inability to answer questions about the CBIZ contract or what exactly the company did for the county during her testimony.

Schneider, formerly Matthews' personal secretary, was named to her position despite not having any prior human resources experience.

Tom Snyder, head of the county department that handles bids for outside services, also had trouble with the grand jury's questions, according to the report.

He allegedly had little knowledge of how often companies applying for county work were asked about potential conflicts of interests, whether their answers were verified or what happened to those that reported potential conflicts, the panel said.

"On several occasions he exhibited willful blindness and incompetence," it wrote.

Both Schneider and Snyder could not be reached for comment. Though, Hoeffel came to their defense Wednesday.

"Much in the grand jury's report is subjective and misses the mark," he said. " must be outraged."

Hoeffel, too, came under grand jury criticism for participating in a series of private breakfast meetings in which he and Matthews discussed county business with Miller and Maza. Castor was never invited.

Both Hoeffel and Matthews have insisted that these meetings were not a violation of the state's open meetings laws - known as the Sunshine Act - because they did not deliberate or decide how they would vote on the issues. The grand jury declined to file charges against either man stemming from those breakfasts.

But despite the pallor hanging over Wednesday's proceedings, the grand jury allegations were not the main draw for the hundreds who filled a courtroom and an overflow room in the county's administration building.

The meeting coincided with a previously planned public hearing on the county's proposed $389 million budget - one that includes stiff cuts in funding for its community college, parks department and planning commission.

Castor and Hoeffel spent nearly five hours fielding public input on the plan. But worked together with an unusual ease, given their prickly past.

"I've spent more time talking to Commissioner Hoeffel in the past two days than I have in all four years of the administration combined," Castor joked at one point.

To which, Hoeffel quipped: "Without violating the Sunshine Act."

Contact staff writer Jeremy Roebuck at 267-564-5218, jroebuck@phillynews.com, or @inqmontco on Twitter.