Theo Lacy Jail Expansion Assured : Corrections: County reaches settlement with city of Orange and a management firm. It agrees to limit the number of inmates in the jail.

More than a year of court battles and behind-the-scenes negotiations came to an end Wednesday as county supervisors approved a long-delayed settlement that paves the way for expansion of the Theo Lacy branch jail.

Construction on the $60-million project--the price tag has grown from about $47 million when it was first approved--is expected to begin late this summer and is scheduled for completion in 1992. The expansion will add 704 beds to the jail, which now is authorized to house 662 inmates.

“I consider this a watershed day for Orange County,” board Chairman Don R. Roth said as the supervisors voted unanimously in favor of the settlement. “This project, which is in my district, represents a major step in our efforts to deal with jail overcrowding.”

The county is under a federal court order to relieve overcrowding, and Theo Lacy is the only near-term solution being proposed to deal with the problem. The county is still searching for a site to build a jail to serve the county’s long-term needs.

The settlement backed by the supervisors Wednesday also won approval from the city of Orange and Tishman West Management, the firm that operates a shopping center across the street from the jail. It has taken more than a year to find common ground between the county and those two groups, and supervisors were openly relieved to see the process finally concluded.

“Let the word go out to lawbreakers and the courts,” Roth said. “Orange County is moving forward with jail construction.”

The city and management company last year sued the county government to block the jail expansion. They charged that the county’s environmental impact report for the project was inadequate, and a Superior Court judge agreed, temporarily blocking work on the project.

Although higher courts eventually lifted the hold on construction, the county still must return to Superior Court to present its amended report, which also was approved Wednesday. That process could have resulted in further litigation, but the agreement approved Wednesday heads off another round of legal squabbling.

“My client supports approval of the project in the form submitted today,” said Robert Leowen, a lawyer who represents Tishman Management and The City Shopping Center. “We have reached a settlement.”

Under terms of the settlement, the county agrees not to exceed 1,326 inmates at the facility except in emergencies. And where emergencies were once defined in such a way as to include jail overcrowding at other facilities, now the county could only push the inmate population beyond that limit to cope with natural disasters or other events beyond the county’s control.

Even in an emergency, the county could not exceed 1,968 inmates.

The settlement also states that no maximum security inmates will be held at Theo Lacy.