Board OKs Using Part of Settlement for Debt

Orange County supervisors Monday tentatively approved using $200 million from last week’s settlement with Merrill Lynch & Co. to pay off some of the county’s outstanding bankruptcy-related debts.

The decision, which was expected, was one of a number of allocations the supervisors must consider in hearings Monday, today and Wednesday on the $3.5-billion budget recommended by the county staff.

Last week, the county picked up $420 million from the nation’s largest brokerage in settling allegations stemming from the county’s 1994 bankruptcy. Merrill also settled with the Irvine Ranch Water District for $17 million.

The fiscal 1999 budget, starting July 1, doesn’t contain any cuts in programs. But it is $233 million less than this year’s budget because of fewer demands on county services and the transfer to the state of most of the county’s share of trial court funding.

While the supervisors generally agreed Monday on all allocations, they split on approval of paying $9.5 million for the continued planning of a commercial international airport at El Toro once the Marine Corps leaves the base next year.

Like most airport decisions by the board, this one passed on a 3-2 vote with pro-airport Supervisors Charles V. Smith, William G. Steiner and Jim Silva in the majority and opponents Todd Spitzer and Tom Wilson dissenting.

Although he approved the El Toro funding, Smith said he is concerned the county is not allocating enough money to improve public relations for the airport plan, particularly because anti-airport forces are budgeting millions to promote their own nonaviation Millennium Plan.

Airport planners asked for more than $2 million for legal costs and $2.3 million for flight testing, but sought only $829,000 for public information.

“How can we match [the anti-airport activists]? They are spending two times more than we are,” Smith said.

In other action, the board tentatively approved $675 million for public protection, mainly money for the offices of district attorney, sheriff-coroner, probation, public defender and marshal.

The county also is expected to finish the first phase of construction on the Theo Lacy Branch Jail expansion, adding 384 beds and 131 sheriff’s deputies to operate the facility.

The second phase of design and construction of Theo Lacy--estimated at costing $33.5 million--is expected to be approved in this year’s budget.

The board also tentatively passed a $566-million environmental resources budget that provides money for harbors, beaches and parks, flood control district and road improvement projects.

Hearings resume at 9:30 a.m. today at the Hall of Administration.