ORANGE COUNTY PERSPECTIVE : Lifeline for Schools in a Time of Crisis

The clock is ticking for the Orange County school districts that participated in the county’s failed investment pool. They face bills coming due soon and the prospect of layoffs or even bankruptcy. The districts, the county and the state must attend immediately to this urgent business to prevent the erosion of vital educational resources.

The business leaders who crafted a plan of restitution for schools have tried to keep everybody in Orange County focused on the huge amount of money that has been lost and the importance of accepting a plan that offers the most realistic chance of immediate and long-term recovery. The acceptance of the restitution plan will not guarantee the health of the districts, but along with other steps it can be a road map for recovery.

Local resolution of the financial crisis is far more desirable than a state takeover of the schools. Accordingly, it was heartening to see movement at the local level in one district facing an immediate crisis, Irvine. It already had heard a warning from its bankruptcy attorney that there was a chance of going bankrupt unless the county released funds soon for a $54.5-million debt payment due in June. School Board President Tom Burnham courageously moved to the front of the effort for a parcel tax. While that city’s last attempt to pass a parcel tax failed, this is an emergency, and local residents must recognize that it may come down to spending a little more now to retain a long-term commitment to educational excellence and to shoring up property values.

Don’t rely on Sacramento to be the sole savior. In recent days, it has been playing its own brand of politics, withholding pledges of assistance. It is true that Orange County needs to do more to help itself by raising new tax revenue to get through the crisis, but a failure by the state to guarantee loans as part of an overall recovery package could be disastrous for local schools and other governmental agencies and could damage the state’s own credit rating.

What the schools need is a combination: an agreed-on plan of restitution, loan guarantees to back recovery notes, and local belt-tightening and short-term parcel taxes to make up the difference.

Support for state loan guarantees to help Orange County was favored by 57% of respondents statewide in a Times Poll last week, and no wonder. The county is a good bet for the long term, and it is an important component of the state. Education is a vital part of that equation.