$2.2 Billion Flies Out Orange County’s Door in 90 Minutes
SANTA ANA, Calif. (AP) _ Investors finally given access to the remains of Orange County’s treasury didn’t run out the door with billions of dollars in cash.
For cities, sewer systems, water districts, transportation agencies and others that willingly invested with the county, Friday was D-Day _ as in distribution. Their funds were unfrozen, 5 1/2 months after the largest municipal government bankruptcy filing in U.S. history.
On average, they recovered 77 cents on each dollar invested, reflecting the staggering $1.7 billion loss to the county pools.
Investors are to get another 3 cents in ``good as gold″ notes in June. County leaders say the last 20 cents will depend on how the county’s lawsuit against brokers works out and whether angry voters approve a sales tax increase.
Partial repayment or not, it was a day for stunts and celebration.
First Interstate Bank handed out doughnuts and coffee at the county treasurer’s office and landed a helicopter atop its Anaheim main branch to fly checks to Los Angeles for free.
The idea was to get them into First Interstate accounts before the weekend.
``We got 11 customers who brought in 38 checks worth $300 million,″ bank spokesman Ken Preston said.
He estimated the money will earn $90,000 in interest over the weekend.
Also on hand was Will B. King, a homeless comedian and auto detailer who harangues county leaders at public meetings and was ejected in drag recently from the O.J. Simpson trial.
Wearing a pink baseball cap, sunglasses with luminescent blue rims, a Hawaiian shirt, a timeworn tie and his trademark shoes _ one black sneaker, one white _ King swaggered up to county Treasurer John M.W. Moorlach.
``I heard you’re handing out money,″ he said. ``I need some.″
Moorlach had none for King but plenty for others: in the 90 minutes it took to distribute more than 250 checks, $2.2 billion flowed out of the county treasury.
Counting money from the county, separate agencies run by the county supervisors, and county schools (which are required to put operating cash in the treasury), Moorlach still has about $3 billion under management.
Moorlach lost an election last year against the incumbent treasurer, Robert L. Citron. His warnings of the risks Citron was taking were largely ignored.
Citron has resigned in disgrace and pleaded guilty to fraud, and Moorlach has been appointed to replace him.
For years, many cities and agencies eagerly invested with Citron, wanting a piece of his high-return action. It will be a while before any return.
``They’ve got to watch us for a while. And if we outperform their other alternatives or we have a better service system I think they’ll slowly return, they may come back,″ Moorlach said.
He said he wishes he could hang out a big sign: ``Under New Management.″