Los Angeles County reaches $4 billion settlement in sex abuse cases

Los Angeles County reached an agreement to settle $4 billion in claims on 6,800 juvenile sex abuse cases dating back to 1959.

The settlement, which has to be approved by the Los Angeles County claims board and the board of supervisors, will be the costliest in the county's history and will have long-lasting budgetary impacts, according to Chief Executive Officer Fesia Davenport.

The settlement is expected to go before the claims board on April 7 and, if approved, it would be reviewed by the board of supervisors on April 29.

"On behalf of the county, I apologize wholeheartedly to everyone who was harmed by these reprehensible acts," Davenport said in a statement. "The historic scope of this settlement makes clear that we are committed to helping the survivors recover and rebuild their lives ? and to making and enforcing the systemic changes needed to keep young people safe."

The county estimated its liability in the sexual abuse lawsuits could be anywhere from $2.1 billion to more than $3 billion, according to disclosure filings posted when it sold $700 million in tax anticipation and revenue notes in June.

The county's plan to pay for the settlement includes using cash from reserve funds, issuing judgment obligation bonds and cutting department budgets.

If approved, the settlement would resolve most ? but not all ? of the claims filed against the county under Assembly Bill 218, according to the county. When that law, and Assembly Bill 2777, went into effect in 2020, the laws lifted the statute of limitations for a three-year period allowing the victims of childhood sexual abuse to file lawsuits.

Bond attorneys told The Bond Buyer in 2023 they expected municipalities and schools facing a large bill, insurance wouldn't cover, would issue short-term debt; and then refund shorter-term notes into judgment obligation bonds with 30-year maturities.

Municipal governments and school districts began including the potential liability stemming from the laws in bond disclosure two years ago.

The laws extend the liability for schools, counties and cities back to the 1970s, long before current laws were passed that outline mandatory reporting of sex crimes by people who work with children.

The majority of the county's claims date from the 1980s, 1990s and 2000s and are alleged to have occurred at probation department facilities and the MacLaren Children's Center, which was permanently closed in 2003.

Investigations are continuing and two cases have been referred to the district attorney for possible prosecution, according to the county.

The county's Department of Children and Family Services has instituted numerous reforms over the years, but additional reforms are in the works that would improve prevention, reporting, disciplinary actions and risk mitigation, according to the county.

The changes include developing a system for expedited investigations and independent review by outside experts, establishing a reporting hotline and strengthening enforcement of the county's zero tolerance policy.