ORANGE COUNTY IN BANKRUPTCY : BOND TICKER : Agency Considers $1.4-Billion Bond Issue to Build Toll Road

The Foothill/Eastern Transportation Corridor Agency Board of Directors will decide next month whether to sell bonds as a means of financing a toll road that would run between Yorba Linda and Irvine.

The agency is considering a sale of nearly $1.4 billion in bonds in early June to fund construction of the Eastern toll road, which would be built in the foothills of Orange, Tustin and Irvine.

Agency spokeswoman Lisa Telles said Thursday that officials aren’t sure exactly what effect the county bankruptcy would have on a bond sale. The corridor agency is independent from the county and would use future toll collections to back up its bonds.

“The question is what the bond market will look like when we sell the bonds,” said Telles, adding that much depends on the success of the county’s recovery plan.

City Group Wants Funds Sequestered

Attorneys for the Buena Park Redevelopment Agency will ask U.S. Bankruptcy Judge John E. Ryan today to sequester the $10.5 million it has frozen in the county investment pool so the agency can pursue litigation against the county.

The action comes three days after the agency rejected the pool settlement proposal, opting instead to seek the return of its money exclusively through litigation.

The Redevelopment Agency wants Ryan to secure its pool investment so the money will be available if the agency is victorious in court.

If Ryan refuses to sequester the money, the agency is expected go with settlement Option B, which provides pool investors with 77 cents on the dollar and allows them to litigate for the remainder.

Compiled by Shelby Grad, with Lesley Wright.