ORANGE COUNTY IN BANKRUPTCY : Business Largely Takes a Hands-Off Approach : Finance: Corporate officials say there is too little information and the situation is too fluid for them to get involved. But a few have taken steps behind the scenes.

As cities and schools have grappled with layoffs and service cuts in the wake of Orange County’s bankruptcy, local business leaders have largely sat and watched from the sidelines.

In interview after interview, officials of major corporations in the county made no apologies, instead saying that there is too little information available and that the situation is too fluid for them to get involved or make public statements.

“There’s simply too many unknowns at this point,” said a spokeswoman for Les McCraw, chairman of Fluor Corp., the multibillion-dollar engineering services company in Irvine.

But others say it is now--in the middle of the largest municipal bankruptcy in U.S. history--that the Orange County business community’s ample business acumen and clout are vital and perhaps essential to a recovery.

Analysts say that in New York and other cities that faced bankruptcy, top business executives moved swiftly and played a leading role in the cities’ recovery--themselves serving in government agencies or lending personnel to raise money and help administer municipal services.

“They responded immediately and quickly,” recalled Felix Rohatyn, a senior partner at the investment firm Lazard Freres & Co. who played a key part in New York City’s recovery after its financial collapse in the mid-1970s. While the roots of New York’s fiscal crisis were different, Rohatyn added, the problems Orange County now confronts are essentially the same.

“How to allocate sacrifices, how do you deal with service cuts and how do you deal with revenue reductions?” are questions that businesses can help answer, Rohatyn said. “I think they can make a real contribution.”

Roger W. Johnson, administrator of the federal General Services Administration and former chairman and chief executive of Western Digital Corp. in Irvine, agreed: “Business leaders have a major responsibility because they have enormous skills.” And for those senior executives who haven’t come forth in Orange County, he said in an interview Friday: “It’s time to get your butts in the game.”

Certainly, local business leaders say they want to help. Many of them have had private, informal talks with county officials, they say. And some accountants and bankers have offered free services to county officials, such as giving a second opinion on advice from outside consultants and providing instruction on complex subjects such as derivatives, which were blamed for much of the $2.02-billion loss suffered by the county’s investment pool.

A few business leaders have taken steps behind the scenes. Henry Segerstrom, a major Costa Mesa landowner and the developer of the South Coast Plaza mall, contacted top Bank of America executives on Orange County’s behalf, said County Supervisor William G. Steiner.

It was unclear what Segerstrom hoped to accomplish, although two days after he placed his call, a dozen Bank of America officials met with county officials to talk about a possible line of credit. Segerstrom declined to comment for this story.

“I don’t think people yet know what steps should be taken,” said Buck Johns, a Newport Beach developer and a prominent Republican activist. “We’ve had a colossal train wreck the magnitude of which we’re still not sure.”

Still, in the more than two weeks since the county’s financial troubles became apparent, business leaders as a group have yet to meet formally with local government officials. And, though they are now starting to form a task force to focus on the fiscal problems, there has been no public word from the county’s heavyweight corporate players.

Representatives of the Orange County Chamber of Commerce and Industry and the Industrial League of Orange County hope that senior executives from Taco Bell Corp., Rockwell International Corp., Fluor and the Irvine Co. will head a special task force to meet with county officials and, among other things, send a delegation to the East Coast to lobby Washington legislators and New York bankers.

But to date, each of the top executives from those firms, as well as some others, has refused to make a public commitment.

“They haven’t stepped up to the counter to help, have they,” said Carl N. Karcher, chairman emeritus of CKE Enterprises, the company that operates Carl’s Jr. restaurants. Karcher, who narrowly avoided bankruptcy himself last year, added that he would remain in the background. “I’m too busy myself.”

Donald R. Beall and Donald Bren, the respective chairmen of Rockwell and the Irvine Co., said through representatives that, at this time, they could not offer any specific plan of action regarding the county’s financial problems. “We’re very confident that the county will weather this storm,” said Bren’s spokeswoman, Dawn McCormick.

Privately, company officials admit that there is little to gain by getting involved in a financial crisis in which there is a lot of finger-pointing, federal investigations and public ire.

Some businesses also say they are really stymied as to what they can do now. Orange County’s debacle, they maintain, is less tangible than, say, the Northridge earthquake or the Laguna Beach fire last year, when there was an immediate outpouring of help from businesses.

Todd Nicholson, president of the Orange County Industrial League, remains confident that business leaders will spring into action soon with a long-term strategy. “Business has the expertise needed to respond, and once the facts are known, I think you’ll see its willingness to respond.”

But others aren’t so sure.

One problem is that no one has emerged as a coalescing force in Orange County, as Gov. Hugh Carey did in New York’s crisis, when he called senior executives from Macy’s, Metropolitan Life and other companies, as well as union leaders, to join forces.

“It’s got to be the power people in Orange County doing it,” said Dennis J. Aigner, dean of UC Irvine’s Graduate School of Management. Without them, analysts said, it will be tougher to bring business, government and labor in Orange County together to work on the crisis.

Bill Fogarty, head of the Orange County Central Labor Council, whose membership includes several thousand county workers, said he has been trying to get a meeting with the Board of Supervisors for the last two weeks. “They have ignored us,” he said, adding that unions have had experience working with bankrupt cities and as such “have the resources to help the county out.” However, the board has met with the Orange County Employees Assn., an independent organization that represents 11,000 county workers.

Those with experience say part of the business community’s reluctance reflects a change in times.

During New York’s crisis, for example, companies gave some senior executives leaves of absence or otherwise freed them up so they could volunteer full time as deputy mayor for finance and budget director, among other positions, Rohatyn said.

But consultant Jacob Ukeles, who helped New York City as well as Bridgeport, Conn., which filed for bankruptcy in the late 1980s, believes it will be harder for Orange County to enlist the assistance of major corporations, because big companies have laid off multiple layers of management in recent years. “That means you have to do more with (fewer people) after hours,” he said.

Indeed, said Don Murray, a partner at the Costa Mesa office of Deloitte & Touche: “Most private businesses are trying to survive.” Though Murray says his accounting firm and others have privately offered their services to county government officials, he said of the business community’s involvement: “No, I honestly don’t think it’s going to happen on a large scale.”

Some business executives candidly say the county’s financial woes are a failure of government, not theirs to get involved in. “This is the county’s problem. They created it,” snapped one top corporate executive, who spoke only on the condition that neither he nor his company be identified. But he also acknowledged that traditionally businesses in Orange County have not adequately participated in civic affairs.

According to Rohatyn, there are rewards from helping out in times of crisis. “It gave me enormous satisfaction,” he said of assisting New York, adding that the Municipal Assistance Corp. he chaired raised $10 billion for the city through bond issues between 1975 and 1985. “We live here, and it would have been a terrible thing for New York. . . . The city has been very good to me.”

Like many others, Peer Swan, president of the Irvine Ranch Water District, is hoping that the joint Chamber-Industrial League business task force being formed will make a difference. With business expertise behind them, Swan says, the county and the municipalities can help make up the losses by re-examining how government operates. “I think they need help in understanding how to run a business,” Swan said.

Ukeles, the New York consultant, put it this way: “You have to recognize that there is a crisis and that it’s everyone’s crisis. It’s not someone else’s crisis, it’s our crisis.”