Bankruptcy Saga
Some key developments in Orange County’s ongoing financial crisis:
* Dec. 2, 1994: After stock market closes, officials verify rumors that county’s investment portfolio has lost nearly $1.5 billion of its value. * Dec. 4: Orange County Treasurer-Tax Collector Robert L. Citron resigns from post he held 24 years. * Dec. 6: Orange County files largest municipal bankruptcy in U.S. history, freezing assets of investment pool. * Dec. 8: Internal audit is released showing county auditor warned officials more than a year earlier that investment pool was not adequately supervised. * Dec. 13: County investment adviser, Salomon Bros. Inc., begins to sell pool assets. * Dec. 19: Orange County district attorney investigators raid Citron’s office, confiscating boxes of documents. * Dec. 27: Municipalities with investments in risky county portfolio say Citron led them to believe their money was in “safer” investments. * Jan. 12, 1995: Orange County sues Merrill Lynch & Co., alleging it concocted an exotic investment scheme that broke state law and led to collapse of county finances. * Jan. 20: Orange County Assistant Treasurer Matthew Raabe is suspended with pay. * Jan. 21: County audit discloses possible bookkeeping falsifications; $85 million in interest was diverted from pool participants to an account managed by Citron. * Jan. 27: Officials announce Citron or his office transferred securities that had lost value from a county fund into an investment account shared by pool investors. * Feb. 2: State auditor questions diversion of more than $200 million from investment pool to a general fund. * Feb. 10: County supervisors appoint former savings and loan executive William J. Popejoy chief executive officer. * Feb. 24: Former County Administrative Officer Ernie Schneider and Raabe are fired; Schneider was demoted from his job Jan 23. * March 7: Popejoy announces plans to lay off 1,040 county employees and eliminate 563 vacant positions. * March 15: Popejoy recommends Measure R, a half-cent sales tax increase to pay for county recovery. * March 21: John M.W. Moorlach chosen to be new county treasurer-tax collector. * March 29: Supervisors agree to special election June 27 to vote on Measure R. * April 25: Auditor-Controller Steve Lewis loses authority over internal audits. * April 27: Citron pleads guilty to six felony charges relating to county bankruptcy. * May 11: State Legislature approves bills allowing county to import trash, sell assets. * May 16: Raabe arrested on six counts of securities fraud and misappropriation. * May 19: Schools, cities and other pool investors withdraw almost $2.3 billion in cash from pool; county had held back funds since filing bankruptcy. * May 23: Orange County Transportation Authority rejects request of county supervisors, local members of Congress to dismiss $119 million in debts owed by county. * June 2: County and majority of note-holders agree on tentative rollover in short-term debt totaling $800 million. * June 5: Bankruptcy Court approves recovery bonds to partially pay off investors. * June 27: Measure R special election. * June 30: $175 million in Teeter bonds due. * July 10: $600 million in taxable notes due. * July 19: $169 million in Series A tax anticipation notes due. * Aug. 10: $31 million in Series B tax anticipation notes due.
