Laid-Off O.C. Workers to Be Paid for Benefits

SANTA ANA —  Seeking to soften the blow of what is expected to be hundreds of layoffs and forced early retirements, Orange County supervisors promised Friday that those let go because of the county’s bankruptcy will receive a one-time cash payment for their sick leave, vacation and other benefits.

Supervisors also reversed their initial demand that county workers who choose to take early retirement by Jan. 10 sign waivers saying they will not sue if the county fails to pay their benefits over the next three years.

Officials characterized both moves as good-faith efforts to deal with angry labor leaders and the county’s 18,000 workers. But spokesmen for county employees decried the concessions as meaningless and said they would move ahead next week with legal action to halt widespread layoffs.

“It’s like somebody who is trying to cut off both of your arms then says, ‘Wait a minute, I’ll only cut off one of your arms,’ ” said Paul Crost, a lawyer for the Orange County Attorneys Assn., whose members include all deputy district attorneys, public defenders and lawyers in the county counsel’s office.

As labor leaders and county officials continued to clash Friday:

* Supervisor Gaddi H. Vasquez, the board’s new chairman, said he was studying whether to allow private companies to run county-owned parks, landfills and other facilities to raise money. Vasquez said supervisors will consider forming a privatization task force of members of the local business community at their Jan. 10 board meeting.

* Supervisors began meeting with consultants who are seeking to help the county out of bankruptcy. In a session with Vasquez and Supervisor Roger R. Stanton, William O’Connor--a principal in a Newport Beach public finance firm--suggested increasing various fees, such as landfill dumping charges and utility taxes, to help restore the county’s solvency.

* In an emergency session called to discuss the impact of the county’s bankruptcy, Catholic Charities of Orange County vowed to continue job placement and other programs despite concerns that the agency may not be reimbursed for the services, whose funding is administered by the county. Those services include emergency food and housing for the needy, in-home care for the elderly, gang prevention efforts and services to people with hearing impairments.

Across the county, cities and school districts braced for more severe cutbacks.

In Huntington Beach, the City Council is set to make nearly $1 million in cuts Wednesday in an effort to close a budget shortfall that has been worsened by the county’s financial crisis. “We have to bite the bullet and see how to deal with it,” said Councilman Ralph Bauer.

In Irvine, school board member Hank Adler said Friday that he expects the Irvine Unified School District to lay off workers. But he said he doubted the district would follow the county into bankruptcy.

“I think we can work our way through it,” he said. “I think (bankruptcy) is possible, but I think it’s unlikely. I’m going to do everything I can to prevent that from happening.”

Irvine schools have the most of any Orange County school district--$102 million--in the county’s now-frozen investment fund, which has lost $2.02 billion in value this year.

Adler and other board members said the district could avoid bankruptcy by selling some assets, such as surplus property. But they said they would try to avoid selling parcels slated as school sites.

“We have some assets we can sell,” Adler said. “Obviously, there’s a lot of steps you can take in a $100-million organization.”

Task Force Likely

The district may seek state legislation that would allow it to borrow money on a long-term basis. Public school districts now can only borrow money for two years or less, Adler said.

“Basically, we have assured revenues over the next decade of $1 billion-plus,” he said. “Surely we ought to be able to borrow $30 million from that.”

Adler said the board will have a clearer understanding of the district’s financial situation after a meeting Tuesday. “I would expect out of this meeting we will get a timeline for decision-making and a strategy,” he said. “With respect to most issues, we will not take any hard action until Jan. 17.”

The board will probably authorize the creation of a financial task force to develop best- to worst-case scenarios, said board member Mike Regele.

“All of us would agree that keeping cuts away from the classroom are a top priority,” he said.

In Santa Ana, the Board of Supervisors, which announced a blueprint last week for broad cuts and layoffs, did an about-face Friday on its requirement that retirees sign a waiver that would have prohibited them from suing if they did not receive all payments due for accrued sick time, vacation and compensatory time during the next three years.

Nonetheless, John H. Sawyer, general manager of the Orange County Employees Assn., called the board’s decisions “entirely self-serving” and hardly a concession.

The lump-sum cash payment for laid-off workers already is called for in labor contracts that the board unilaterally voided, and the waiver demanded of retirees was blatantly wrong, said Sawyer, whose group representing 11,000 workers is the county’s largest employee union.

“The board’s action does nothing to restore the provisions of the labor agreements rejected by the board last week,” the association said in a statement Friday. “The county is continuing to act in a unilateral manner, and it is not acceptable to us.

Sawyer said there are more than 2,000 county employees eligible to retire. But he charged that the county, by imposing a Jan. 10 deadline for retirement decisions, is trying to frighten employees into retiring early.

“That deadline alone is enticing people to retire early,” Sawyer said. “We think that the employees who want to retire early should be allowed to. But we definitely don’t want the county talking people into retirement when they might be better served working another year or five years.”

Sawyer, who initially estimated that 800 to 1,000 employees would lose their jobs as a result of the cutbacks announced last week, now says he does not expect such massive layoffs to take place right away.

“I really don’t have any idea how many layoffs there will be, and I don’t think the county has any idea,” he said. “But I don’t expect massive layoff notices next week. We hope they won’t end up cutting anyone.”

On Thursday, eight people were laid off from the county administrative office--five part-time staffers and three interns. More layoffs are expected because of the crisis, which forced the county to declare bankruptcy Dec. 6.

Tom Uram, director of the county Health Care Agency and a member of the three-person management council that is devising the county’s budget cuts, said the Board of Supervisors backed off the waiver for retirees because of employee concerns that “it looked like a trick.” Uram said removing the waiver would certainly help more workers make the decision to retire early. A letter detailing the removal of the waiver requirement will be sent to all eligible employees, he said.

But Supervisor William G. Steiner downplayed the significance of Friday’s action.

“For what it’s worth, it softens the impact of the layoffs,” he said. “Secondly, employees who retire now maintain their legal rights if the county doesn’t have money in 1996-97.”

Steiner said making sure the county meets its obligations to those who retire “should be our highest priority.”

Airport Sale Unlikely

Under the bargaining agreement approved by supervisors last week, employees who retire before Jan. 10 would receive the balance of their sick and compensatory time and vacation in three payments over the next three years. The benefits of those who retire after Jan. 10 will be subject to the bankruptcy process, which could cloud the payment picture.

Friday’s action by the board also clarified that all employees who are laid off due to budget cuts will receive their compensatory time and vacation pay in one lump sum. Some employees had expressed concern that their money could be tied up in the bankruptcy process, officials said.

Uram said that the management council, which last week unveiled $40.2 million in budget reductions, had not received word of any additional layoffs as of Friday, but that department heads have been encouraged to make those decisions and alert employees as soon as possible. Department heads must give employees 14 days notice if their jobs are to be cut.

Sawyer said the union is meeting with department heads to talk about ways to make budget cuts without layoffs. Worker representatives are encouraging department heads to check all contracts, eliminate overtime, initiate job sharing and be more liberal in granting leaves of absence.

While supervisors still are weighing ways to privatize various government services, Vasquez and Steiner warned that there are obstacles to selling John Wayne Airport.

Steiner said the airport still is subject to $254 million in bonded debt that would have to be paid off before any sale could be completed. Another $70 million in federal funds would have to be returned.

Correspondent Shelby Grad contributed to this report.