ORANGE COUNTY IN BANKRUPTCY : School Officials Avoiding Talk of Bond Crisis Fallout : Education: Placentia-Yorba Linda chief declines to discuss cuts. Many are growing impatient.

Parents and other residents in the Placentia-Yorba Linda Unified School District have become increasingly impatient with school administrators for failing to disclose how they plan to cope with potential losses from the county’s bankruptcy.

The district has a particularly acute problem because it was one of five Orange County school agencies that borrowed extra money to invest in the county’s now-failed investment pool. The district has a $50-million bond payment that must be paid back in August.

Other districts that face heavy losses, such as Irvine Unified, have announced major budget cutbacks, but Placentia-Yorba Linda officials have held off announcing any sweeping plans to cope with possible losses.

“Going out and publicly proposing things that will scare employees and the community when we aren’t sure of the magnitude of the problem is irresponsible,” said Supt. James O. Fleming. “It is unproductive when we may never do those things.”

In addition to the $50 million in borrowed money, the district has another $27 million frozen in the county fund.

Some parents and at least one district trustee say they are growing increasingly uncomfortable with the district’s wait-and-see approach. Even if the district eventually receives all of the money deposited with the county, critics said, there is still the loss of interest to cope with as well as the higher interest rate the district may have to pay in the future for operating loans it routinely relies upon.

“It really worries me that not one person on the board has publicly acknowledged that there will be cuts,” said Trustee Cathy Ann Brooks.

Patrick Hanrahan, a Yorba Linda resident, said the district is being unrealistic if it does not assume the worst will happen.

“I have very serious concerns that the superintendent caught a bad case of denial,” said Hanrahan, who ran unsuccessfully for the school board last year. “When he said he was confident all payroll would be made, either he (isn’t looking) past the next few weeks or he plans to lay off (employees).”

Tuesday night, district officials issued a two-page letter responding to questions about why administrators decided to invest $50 million in borrowed funds in the county investment pool, saying they needed extra interest revenues because there has been no increase in funding from the state.

But they have made no public disclosures about how the district plans to cope in the long term.

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The district, which has an annual budget of $95 million, has taken some small steps to cope with its restricted cash flow, including freezing two administrative positions that will save the district $60,000 and halting nonessential spending.

But those measures are far less severe than those taken by other districts. Irvine Unified School District, which has $105 million tied up in the pool, will announce potential teacher layoffs at its Feb. 14 meeting. It is also considering selling several district properties and has formed a citizen’s committee to recommend $30 million in cuts.

“I don’t happen to agree with their approach,” Fleming said. “We’re sitting in the middle of a school year. There are kids in he classroom and it would be unproductive to take things apart this year when the end result is still unknown.”

The superintendent said his staff has begun considering possible cuts the district could make in the future if it loses a portion of its principal.

“We aren’t assuming the best,” Fleming said. “I just don’t believe it’s good to go out there and scare employees that they are going to lose their jobs when we really don’t know if they will.”

But Yorba Linda resident Mark Connolly, who has three children in district schools, said, “I don’t buy that they are waiting to act because they don’t know the extent of the problem.”

Brooks, who was elected in November and did not vote on the district’s plan to borrow $50 million to invest in the fund, said the district can handle many of these complaints through a policy of open decision making.