Countywide : Settlements to Be Paid to Schools

The county government will soon begin paying $2.7 million to the county’s 27 school districts, settling a lawsuit in which the districts sought a share of penalties collected by the county for delinquent property taxes.

The payments, which will begin within two weeks, come on the heels of a similar settlement between the county and 50 other public agencies, including most Orange County cities.

During 1988 and 1989, the cities, water districts, school districts and other agencies sued the county, charging that they should receive a slice of the revenue the county collects in penalties on delinquent property tax payments.

The state Legislature in 1989 passed a law stating that county governments are entitled to keep all such revenue. That statute was upheld by an appellate court last year in a suit against Orange County by the city of Santa Ana.

The county government, however, decided to pay settlements to the agencies because it will cost it less than it would to try each case in court, officials said. The settlement covers fiscal years 1985 through 1989, and precludes the agencies from seeking any further reimbursement.

The payments to the school districts range from $10,304 to the tiny Savanna School District to $202,910 to the Newport-Mesa Unified School District.

The settlement amounts are equivalent to 22% of the amount each school district had sought, the same as the county’s agreement with the other public agencies.