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/raid1/www/Hosts/bankrupt/TCR_Public/950911.MBXBANKRUPTCY CREDITORS' SERVICE, INC. OCTA OKs final Bankruptcy Consensus Plan; annual $15 million deficit to significantly affect bus system ORANGE, California -- September 11, 1995 -- The Orange County Transportation Authority (OCTA) board of directors Monday approved the joint agreement of the href="chap11.orange.html">County of Orange Bankruptcy Consensus Plan. The consensus plan calls for every agency represented by the Orange County Investment Pool (OCIP) and the County to share in the financial burden of the recovery. OCTA will play a key role in meeting the County's financial needs for bankruptcy recovery. Under the joint agreement, OCTA will experience an annual deficit of $15 million, following a first year loss of $38 million. The loss will significantly affect te bus system, according to an OCTA report discussed Monday. An independent review from the State Legislative Analyst's Office agreed that bus riders will be impacted. The consensus plan builds on other recovery documents the League of Cities, Family of Governments, and County financial advisors developed. The plan also culminates weeks of intense discussions and negotiations mediated by the Orange County Business Council. The joint agreement encompasses the major points of the consensus plan approved in concept by the OCTA board on Aug. 28. The consensus recovery plan transfers $38 million a year for 15 years from OCTA to the County of Orange beginning July 1, 1996. The plan also calls for transfer of $23 million of the County's $33 million gas tax funds to OCTA for 16 years beginning July 1, 1997. In the first year, the loss to OCTA will be a full $38 million. The plan contains several additional factors based on further discussions among the Orange County Business Council, the OCIP Committee, the cities, and County advisors and staff. Those changes include:

The County of Orange will not seek further fund diversions. The County will no longer longer seek $18 million from the pool committee for the County to meet its general fund obligations. The County will release the current cash balance (including post-bankruptcy petition interest) on OCIP county-administered accounts. The schools will receive $13.4 million in withheld property tax revenues. Other County-administered special districts will contribute $12 million annually to the County.

Former state treasurer Tom Hayes will chair an Orange County Recovery Committee. The panel, made up of two County-selected representatives, and two members (one from a city) selected by the OCIP Committee, will review the County's "plan of adjustment" to assure the recovery consensus plan is consistent with the joint agreement. The joint agreement requires that its funding transfers be approved with legislation. The proposed bill is scheduled for conference committee hearing. The committee is comprised of Senators Lucy Killea (I-San Diego), Richard Polanco (D-Los Angeles), and William Craven (R- Oceanside), and three members from the Assembly, Doris Allen (R- Cypress), Brian Setencich (R-Fresno), and Richard Katz (D-Los Angeles). The Senate and Assembly must approve the bill no later than midnight on Friday, Sept. 15. Gov. Pete Wilson then has 30 days to sign the bill. Once Gov. Pete Wilson signs the legislation, OCTA will begin work on a detailed analysis of bus operations and return with an update within 120 days. At that time, the OCTA board of directors will face several key policy decisions such as refilling the $15 million through cutting other programs or how to absorb the loss in bus operations service cuts. CONTACT: OCTA, Elaine Beno, 714/560-5571