OC School Bonds Face Insurance Scrutiny

2.8%

That figure represents the approximate share of building costs that can be consumed by construction insurance premiums. For nine Orange County school districts with approximately $2 billion in approved bond measures, this percentage translates into millions of dollars in taxpayer funding. The districts are currently in the planning and design phases for projects funded by bonds approved by voters in November 2024.

The specific choice of insurer is rarely the subject of public debate. However, a review of past practices at local college districts reveals potential conflicts of interest that have remained out of public view for years. Between 2002 and 2014, the Rancho Santiago Community College District (RSCCD) and the North Orange County Community College District (NOCCCD) secured $1.1 billion in bond funding through three separate measures. Rather than purchasing coverage from traditional markets, these districts used a private entity to handle construction insurance.

The entity, Captive Insurance for Public Agencies (CIPA), was established in Hawaii in 2005. It operated as a subsidiary of a public joint powers authority. Three public administrators held board positions at CIPA while simultaneously serving as vice chancellors for the college districts that paid premiums into the company. John Didion, RSCCD Vice Chancellor of Human Resources, served as a CIPA director during the construction of the $337 million Measure E bond. He retired in 2016 and became the paid Managing Director of CIPA. Peter Hardash, RSCCD Vice Chancellor of Fiscal Services, joined the CIPA board after Didion left and remained employed by the district through most of the $198 million Measure Q bond construction.

Fred Williams, NOCCCD Vice Chancellor of Finance and Facilities, was appointed to the CIPA board in 2019, just before the start of the $574 million Measure J bond projects. He remained employed by the district throughout the construction period. While in these official roles, Didion, Hardash, and Williams moved millions of dollars in premiums from the college districts to CIPA. They did not inform elected trustees of their specific responsibilities with the insurance company.

Recent reporting by the Palomar College Telescope highlighted that Williams prepared agenda items for the NOCCCD board in 2019 and 2023 recommending CIPA handle insurance. The materials did not disclose his position with the entity. In a statement, Williams said he had the approval of Chancellor Byron Clift Breland. Breland was verbally informed of the involvement within six months of his arrival in January 2022. A 2024 Times/OC article noted that RSCCD trustee John Hanna was unaware of CIPA or his administrators' roles on its board.

The nine school districts in Orange County are now preparing for major construction. The administrators involved in the college district arrangements have since moved on. Didion is the President of CIPA. Hardash served as a director until 2025. Williams retired from NOCCCD in December 2025 and was appointed interim Vice Chancellor of Fiscal and Administrative Services at Palomar College last month. The current school districts must now decide how to structure their own insurance arrangements.