$24.6 Million for Schools if County Settles
Local schools, which lost millions of dollars when Orange County’s investment pool crashed three years ago, will get a sizable chunk of their money back if the county settles a damage suit against its former bond attorneys, officials said.
The schools would receive $24.6 million, more than half of the $45.3 million that LeBoeuf, Lamb, Greene & MacRae has agreed to pay the county to settle its bankruptcy-related suit.
The remainder would be apportioned to some of the other 200 agencies that lost $1.64 billion when the county declared its historic bankruptcy in December 1994, according to a detailed breakdown of the payments obtained by The Times on Wednesday.
The deal is being held up by the North Orange County Community College District, which is a party to the county’s legal action and has a separate legal dispute with LeBoeuf.
Attorneys for LeBoeuf say they will not turn over any money unless the county gets the community college district to drop its separate suit. Lawyers for the college district have refused to accept that condition.
Officials of several school districts said the delay in settling the dispute between the college district and the county was robbing them of funds needed to repair cracked playground surfaces, leaky roofs and obsolete classrooms.
“Schools are losing money every day this isn’t settled,” said John Nelson, assistant superintendent of the Orange County Department of Education. “It’s important that we wrap this up quickly.”
Ed Decker, a trustee with the Newport-Mesa Unified School District, said his district would use some of the nearly $2 million it would receive from the LeBoeuf settlement to repair classrooms and facilities.
“My concerns with the El Nino rain coming is that roofs are repaired so we don’t have leaks,” Decker said.
But it appears unlikely that the district will receive any funds soon.
College district officials have refused to drop their suit despite heavy pressure by county officials. Last week, Board of Supervisors Chairman William G. Steiner asked county lawyers to determine if the county could freeze more than $250,000 in funding for the college district.
On Wednesday, sources told The Times that the county was exploring other options, including the possibility of getting legislators in Sacramento to cut off some state funds allocated annually to the district.
Edmond M. Connor, an attorney for the college district, confirmed Wednesday that “there have been threats about what will happen to our district’s funds coming out of Sacramento if we do not play ball as dictated by the county.”
Said Connor: “The district remains mystified as to why there is such a concerted effort reaching all the way to Sacramento to protect the assets of a large law firm.”
Connor argued that the county has entered into a “sweetheart deal” with LeBoeuf because, under the settlement, the law firm’s malpractice insurance will cover any payment up to $50 million.
After the county filed bankruptcy, both the college district and the investment pool filed suits alleging that LeBoeuf failed to alert them to former Treasurer Robert L. Citron’s high-flying investment strategies, even though LeBoeuf’s partners had intimate knowledge of the treasurer’s activities.
The college district would receive about $2 million from the proposed LeBoeuf settlement. That is in addition to the $2.1 million it is expected to receive later this month, its portion of the $30 million that Wall Street brokerage Merrill Lynch & Co. paid to end a grand jury investigation related to the bankruptcy.
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Accounts Payable
LeBoeuf, Lamb, Greene & MacRae’s agreement to pay the county about $45 million would mean about $25 million for school investment pool participants and about $20 million for city and other non-school entities. Amounts due the districts and some individual cities:
School District: Amount
Anaheim Elementary: $179,299
Anaheim High School: 433,922
Brea-Olinda: 170,635
Buena Park Elementary: 98,345
Capistrano Unified: 1,384,461
Centralia Elementary: 197,026
Cypress Elementary: 155,434
Fountain Valley Elementary: 127,194
Fullerton Elementary: 115,860
Fullerton High School: 593,703
Garden Grove Unified: 1,248,628
Huntington Beach Elementary: 209,270
Huntington Beach Union High: 462,807
Irvine Unified: 2,222,481
La Habra Elementary: 300,604
Laguna Beach Unified: 161,612
Los Alamitos Unified: 228,212
Lowell Joint Elementary: 5,453
Magnolia Elementary: 134,135
Newport Mesa Unified: 1,874,098
Ocean View Elementary: 231,147
Orange Unified: 451,470
Placentia-Yorba Linda Unified: 1,920,129
Rossmoor Unified: 120
Saddleback Valley Unified: 1,067,174
San Joaquin Elementary: 65
Santa Ana Unified: 1,135,872
Savanna Elementary: 80,296
Shandon Unified: 4,124
Tustin Unified: 203,862
Westminster Elementary: 309,689
Yorba Linda Elementary: 275
Orange County Dept. of Education: 1,278,992
College District: Amount
Coast Community College: $511,682
North Orange County Community College: 1,954,843
Rancho Santiago Community College: 380,741
Saddleback Community College: 559,350
City: Amount
Anaheim *: $1,053,642
Brea **: 57,867
Costa Mesa **: 21,503
Cypress: 36,361
Dana Point: 97,373
Fountain Valley ***: 191,420
Fullerton: 141,762
Huntington Beach: 272,809
Irvine: 1,283,501
La Habra: 50,510
La Palma: 34,368
Laguna Beach: 48,163
Laguna Hills: 5,549
Laguna Niguel: $112,297
Lake Forest: 58,398
Los Alamitos: 13,264
Mission Viejo: 115,773
Newport Beach: 96,418
Orange: 174,112
Placentia: 127,805
San Clemente: 220,661
Santa Ana **: 777,393
Seal Beach: 12,585
Stanton: 18,168
Tustin: 1,419
Villa Park: 7,856
Westminster: 881
* Includes funds for hazardous-materials response authority, public financing authority and redevelopment agency
** Includes redevelopment agency
***Includes community development agency
Source: County of Orange
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