No Charges Against Fired Chancellor : Education: After an investigation, the district attorney’s office decides not to prosecute a former official of the North Orange County Community College District, who had been accused of misappropriating funds.

The district attorney’s office announced Monday that no criminal charges will be filed against a former chancellor of the North Orange County Community College District, who was fired last year after being accused by trustees of misappropriating funds.

James S. Kellerman, now a college administrator in Missouri, issued a statement Monday blasting his two chief critics on the district’s Board of Trustees for “their careless and reckless comments (which) did nothing but perpetuate rumors and gossip which endure to this day.”

Kellerman’s attorney, Ronald G. Parker of Fullerton, announced that his client had been cleared of wrongdoing by the district attorney’s office. However, Deputy Dist. Atty. Wallace J. Wade, in charge of special assignments for his office, said that is not entirely the case.

“It’s not our job to say whether any wrongdoing occurred,” Wade said. “We can only say that we have decided that this case does not warrant the filing of criminal charges.”

Wade said that his office made the decision after a thorough investigation that included interviews with numerous witnesses and a review of a considerable number of documents.

“It was a very thorough investigation,” Wade said.

Kellerman, 55, had been appointed in 1986 as chancellor for the district, which operates Fullerton and Cypress colleges and an adult education program, with a total of about 30,000 students. He replaced Leadie Clark, the first black female chancellor of a community college district in California, who was fired after several trustees objected to her “leadership style.”

Clark filed suit against the district and was awarded $125,000 in an out-of-court settlement. Kellerman has also filed a lawsuit against the district, which is pending.

During Kellerman’s first two years as chancellor, the district trustees were apparently pleased with his work. In 1987 he was given a new four-year contract at an annual salary of $97,000.

But in 1989, he came under attack from several trustees who alleged that he mishandled funds. The only allegations to surface publicly were that he bought $2,000 in computer equipment for his home and charged it to the district, and that he misused his expense account. Kellerman denied any wrongdoing.

“We’ve been able to prove to them that the district did not pay for the computer equipment,” Parker said.

Parker added that none of the trustees so far has been able to show a single act of malfeasance by Kellerman.

“Dr. Kellerman was persecuted by some of these trustees in the news media,” Parker said. “When he was dismissed, he became untouchable. No one would hire him.”

Parker said that Kellerman was eventually hired in Missouri by an association of community colleges, but that the position “is no more than half or one-third the prestige of what he had here (in Orange County). He’s at an age where this came at a pivotal time in his career.”

Before coming to Orange County, Kellerman had been executive-director of the Sacramento-based California Assn. of Community Colleges. He was hired by the district in 1985 as vice chancellor under Clark.

Leading the allegations against him were district board President Otto Lacayo and board member Christopher Loumakis. Loumakis wound up on the dissenting side in a 5-2 vote to oust Kellerman. Loumakis and Trustee Wallace R. Hardy voted to keep him on paid suspension. But it was Loumakis and Lacayo who were singled out by Kellerman for criticism in the statement he issued Monday.

“The public now has the right to know why trustees Loumakis and Lacayo chose to publicize their allegations of criminal wrongdoing prior to a verifiable investigation,” Kellerman stated. “Unfortunately, it is very doubtful that the same people who read of the initial criminal allegations will read of the exoneration with equal attention.”

Lacayo said Monday that he would not comment on Kellerman’s statement or the district attorney’s decision because of the former chancellor’s pending lawsuit against the district. Loumakis could not be reached for comment.