The State : College Finds It Is Broke

Lassen Community College, in debt and mired in lawsuits over a waste-to-energy plant that failed, apparently is headed for bankruptcy court. The governing board of the college district voted in Susanville to allow college President Virginia Holten to file for municipal reorganization under Chapter 9 of the federal bankruptcy code. The college faces a budget deficit of $800,000 to $1.2 million. It has depleted an $800,000 reserve fund used to make payments on a $7-million financing of the waste-to-energy project, officials said, and has been declared in technical default. Shortly after the plant started up, the turbine broke and it was shut down. School officials alleged the damage resulted from a design flaw and sued the various companies involved.