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Orange County Considers $320 Million Pension-Note Sale to Itself

Orange County, California, which suffered the biggest municipal bankruptcy in U.S. history, may borrow as much as $320 million from itself to pay pension costs as its expenses for retiree benefits balloon.

The plan is to sell taxable pension-obligation notes maturing in about 16 months to the Orange County Investment Pool, Chief Financial Officer Robert Franz said. The proceeds would allow the county to make its annual pension fund payment ahead of schedule, qualifying for a discount of as much as 7.75 percent, according Board of Supervisors documents.