City Rejects County Offer on Investment Settlement

The city has rejected a proposed settlement with Orange County that would return some money from accounts that were frozen shortly after the 1994 bankruptcy, saying the county’s offer was too low.

Under an earlier settlement agreement, Westminster recovered about 80% of the money it had in the county’s collapsed investment pool, with the remainder to be paid in the future.

The current proposal addresses various accounts that were held by the county for eventual distribution to the city, such as property tax collections or grant distributions.

Westminster had $1.4 million in those accounts, but the county has offered to repay only about $350,000, city Finance Director Brian Mayhew said.

Calling the decision a difficult and possibly risky one, Mayhew told the City Council that he could not recommend the offer.

“There’s a $1-million differential there,” Mayhew told the City Council this week. “We need to continue to negotiate with the county.”

The council voted unanimously to reject the offer and directed city staff to take “appropriate steps” to challenge the proposal, including litigation if necessary.

Westminster may be alone in rejecting the county’s plan. So far, about 15 Orange County cities have approved the agreement and no others have rejected it.