Not too many months ago, it seemed Miami was on the way to impressive and lasting improvement in city government. Mayor Manny Diaz swept into office promising to "run Miami like a business," and brought in a tough city manager, Joe Arriola, who instituted sophisticated performance measurement techniques.

Then it all began to unravel. The mayor created image problems by engineering a $53,000 raise for himself. A judge voided a $7 million settlement with seven individuals over the city's unconstitutional fire fees that left thousands of other ratepayers out in the cold. Key members of the reform team were criticized for conflicts of interest in a multimillion-dollar real estate deal. "Looks like the bad old days are back at Miami City Hall," a Miami Herald columnist wrote earlier this year.

In the midst of all this, city manager Arriola wore out his welcome by proving to be not only tough but abrasive, given to obscenities in expressing his opinions. When he grew too blunt during one public appearance, Diaz fired him.

And so Miami has a new city manager, Pete Hernandez, who faces the daunting task of trying to restore employee morale and public confidence in the city government. Hernandez started working for Miami-Dade County back in 1973 as a civil engineer, rising to oversee the public works department before becoming deputy county manager.

A behind-the-scenes player by nature, the 59-year-old Hernandez will come as a relief to many in city government who had grown frustrated at the implosive Arriola. "Whenever Pete is in the room and there are problems being discussed, he has a knack for finding solutions that both sides can agree to," says County Commissioner Carlos Gimenez.

For all the recent embarrassments, Hernandez does not inherit the structural problems that other recent city managers have taken on. A deacade ago, Miami suffered a serious debt crisis. Much of the fiscal trouble has been mitigated by a residential housing boom. But pensions and personnel management remain concerns. The city's firefighters have worked without a contract for nearly two years.

Ed Pidermann, president of their union, says he's hopeful the change in leadership will lead to a breakthrough. "There are different managing styles and Hernandez seems to lack any insecurities that would require him to manage with a stick," Pidermann says.

A change in personality and approach seems to be mostly what Hernandez is offering. He says he'll "tweak" city government, arguing that for all of Arriola's abrasiveness and Diaz's controversies, Miami is generally heading in the right direction. When the mayor claimed at a news conference to be the "funnier" of the two men, Hernandez was agreeable. "I can play the straight man," he said.

What remains to be seen is whether someone who is a straight man by nature can return Miami to the reformist path. "I almost have to go to Pete and on the one hand say, 'Thank God you're here,'" says Horacio Stuart Aguirre, a mortgage broker and friend of Hernandez, "and on the other hand say, 'Are you nuts to take this job?'"