BOND TICKER : ORANGE COUNTY IN BANKRUPTCY : Bigger Jail? Last Hurdle Is Money

The city of Orange and the county have reached agreement on the controversial expansion of the Theo Lacy Branch Jail, but the issue may be moot: The bankrupt county can’t afford the project.

“We simply don’t have the funds to become involved in a construction project like this,” County Supervisor William G. Steiner said Wednesday. “It’s on hold indefinitely.”

But Steiner said the agreement is still necessary because Orange County’s critical jail shortage calls for planning for the future. A much smaller and less expensive expansion will go forward this summer, involving “double-bunking” certain jail cells to add bed space for about 200 inmates, he said.

The original proposal called for expanding the 1,326-bed minimum-security jail to 4,480 beds. After much outcry from Orange residents, the expansion project was scaled back to a 2,986-bed facility that would house 1,152 maximum-security prisoners, Steiner said.

In exchange for dropping its lawsuit challenging the expansion, the city will get a $10-million economic incentive package. The county also will waive the $250,000 in jail booking fees the city spends each year, offer traffic abatement measures around the jail area and beef up security.

The plan is expected to come before the Orange City Council and the Board of Supervisors in coming weeks.

“This will finally stop all the litigation that his been costing us a lot of money,” said Orange Mayor Joanne Coontz, who said the incentives will also help with plans to expand a nearby shopping area.

Deputies to Keep Special Overtime

County officials and Sheriff’s Department labor representatives reached a tentative agreement this week on a plan that allows deputies to keep a special form of overtime pay in exchange for giving up some other benefits.

The overtime pay, known as Madera pay, was slated to be cut from next year’s budget as part of the county’s massive effort to reduce the costs and size of government. County officials said eliminating the overtime pay would save the department about $2.5 million.

Deputies have vehemently opposed the cut, saying the elimination of Madera pay would result in pay cuts of between 7.5% and 9.4% for as many as 800 uniformed officers. Instead of giving up the pay, deputies will give up free meals at the jails, make reductions in compensation-time benefits and contribute more money toward their own medical benefits.

Chances ‘Neutral’ on O.C. Bills

Past performances aside, Democratic Speaker Willie Brown said this week that the Assembly “is still pretty much neutral” on the package of Orange County recovery legislation now headed to the lower house.

The bulk of Orange County’s recovery bills are expected to be heard next Tuesday by an Assembly select committee dealing with the bankruptcy and then head to the floor for a decision May 25 or 26.

Brown did issue some warnings, saying that rejection of a half-cent sales tax hike by the county’s voters on June 27 could put the county “out of business” and make a state trusteeship “almost automatic.”

“They better have a fail-safe backup plan in place,” Brown said, adding that county lawmakers ought to “rethink” their lack of support for a measure authored by Sen. Lucy Killea (I-San Diego) that would give the governor the power to order a state takeover of county operations.

Compiled by Times staff writer Rene Lynch, with staff writers Matt Lait and Eric Bailey.