Oakland City Administrator Deanna Santana, an advocate for fiscal stability who encouraged appropriate decorum and conduct in Oakland City Hall, will resign her post later this week, The Chronicle has learned. Santana's departure represents another dilemma for Mayor Jean Quan, who already faces a tough re-election race in November.

Santana, who built a reputation as a tough-minded public official in the fog of the 2011 Occupy Oakland demonstrations, confirmed her departure in a phone interview on Sunday afternoon but declined to say why she is leaving.

Sources close to Santana said it is because her efforts to put the city on solid financial ground have been repeatedly undermined by the Oakland City Council and Quan, including their refusal to place limits on escalating labor contracts of municipal workers.

"I believe I've served the city well for the time I've been here, and the mayor and I have agreed on a mutually beneficial exit strategy," she said.

Santana's departure comes amid Quan's re-election campaign. Coupled with the recent departure of Chief of Staff Anne Campbell Washington, her abrupt resignation sends the message that there is uncertainty and instability in Quan's administration. At the same time, Quan has no permanent police chief - a key position, especially in Oakland.

Job hunt not a secret

Fred Blackwell, an assistant city administrator and Oakland native, was appointed by Quan to fill Santana's position.

It's no secret that Santana, 43, has been looking for a new job. And because she's seeking public employment, her job searches have also been public. In the past three months, Santana has been a finalist for jobs in Dallas and Phoenix. She didn't get them.

"Deanna Santana's job search circus is only good for Deanna," said one City Hall staff member, who declined to be identified. "It's been a big distraction - and we need focus."

It's perhaps an inevitable end to a partnership with Quan forged in 2011 during the confrontational Occupy Oakland demonstrations on the plaza outside Oakland City Hall.

Only three months into her job, Santana made a strong impression on her colleagues and Oakland residents with her decisive action.

When Quan, in her first year as mayor, couldn't disentangle her passions as a former activist from her duties as a mayor, Santana stepped in to do the heavy lifting.

She put an end to the growing encampment and won the praise and respect of her colleagues for her actions.

Made tough decisions

"She made the tough decision the mayor wouldn't make," Oakland City Councilman Larry Reid said at the time. "She is a godsend for this city."

But Santana's hard-nosed approach did not sit so well when she displayed the same penchant for reforming - and reining in - the City Council.

Her efforts to implement rules of conduct, limit council interference with city contracts and nudge some members to follow the very rules they were elected to uphold were not received with the same enthusiasm.

The one thing that Santana's critics and supporters do agree on is that she is a talented administrator who has worked hard to set a responsible financial path for a city that has battled budget deficits for the past few years.

In her first year on the job, Santana closed a $58 million gap in the city's general budget. In 2012, she came up with solutions to cover the loss of $28 million when state officials cut off funding for local redevelopment agencies.

If Santana had a blind spot, it was the unbreakable connection between local labor leaders and the elected officials who count on them for political support.

While the city's elected officials do all they can to satisfy municipal unions, with everything from pay hikes to signing bonuses, Santana held a hard line - and came to be seen as the enemy.

Whether the unions respect her, or elected officials supported her, Santana was simply doing the job she was hired to do.

Beholden to residents

Santana was not beholden to the unions. She was beholden to city residents. She did not provide lip service to elected officials when the sober truth was required, even while others curried favor with the angry crowds at council meetings.

But in the end, Santana was never a good fit for Oakland, a city where nothing is etched in stone and all the rules are subject to interpretation and renegotiation.

Santana doesn't have it in her to remain silent while elected officials ignore their own policies or rewrite them to accommodate the situation, then rubber-stamp them as responsible government actions.