FULLERTON : College District Picks Settlement Option A

Calling it their only financially viable alternative, trustees of the North Orange County Community College District voted unanimously this week to accept so-called Option A of the settlement offer for agencies with money in the county investment pool.

Under Option A, the district expects to receive about $78 million by June 5.

The district had nearly $86 million in the pool when the county filed for bankruptcy Dec. 6. About $50 million of that total had been borrowed by the district strictly for investment purposes.

Given the district’s financial crisis, trustees said they could not vote for Option B of the proposed settlement agreement. Under this option, the district would receive $65.5 million in cash but would retain the right to sue the county for lost funds.

Chancellor Tom K. Harris Jr. predicted it would take five years to reach a court settlement under Option B, and that the district would probably win. But because the district needs the money as soon as possible, waiting five years is a luxury the district cannot afford, Harris said.

“Certainly we cannot survive with Option B,” according to board President Nilane A. Lee, who emphasized that the trustees must protect the district’s programs and employees.

“Option A is the only one that will help us accomplish that,” she said.