Actions Completed for Emergency Preparedness:

The Governor signed legislation to appropriate $5.4 million for planning and advanced deployment of resources. These funds would be allocated by the Department of Water Resources to other agencies as needed to plan for possible flooding and will allow for deployment of staff to areas of particular concern in the event that flooding is forecast. In the past, such deployments have often occurred only after floods were in progress.

Disaster Funding Mechanisms:

If the El Niño were to result in serious flooding, there are a number of mechanisms which would be used to fund necessary response efforts by state and local governments, to assist victims and to repair damaged public facilities. Severe flooding, such as that occurring in 1995 and 1997, would normally result in disaster declarations by the Governor and at the federal level. State agencies respond to the disaster as directed by the Governor, and a federal declaration makes the state eligible for federal assistance of various sorts.

Under current law, the Governor is authorized to allocate funds to state agencies by Executive Order in the event of a declared disaster. This mechanism is typically used to fund response costs by state agencies as well as funding provided to local agencies through the Office of Emergency Services.

Victims of flooding would also be eligible for tax relief. Current income tax law and bank and corporation tax law allow non-business casualty losses over $ 100, not reimbursed by insurance, to be deducted if the loss for the year exceeds 10% of adjusted gross income. Casualty losses on business property are not subject to the $100 and 10% of adjusted gross income limitations that apply to non-business property. Fifty percent of unused losses may be carried forward for up to 15 years as a net operating loss. Casualty losses that occur in a federally declared disaster area may be claimed in the year that the disaster occurred, or the preceding year, which allows disaster victims to immediately take advantage of these provisions. In the aftermath of disasters, legislation has also often been enacted to authorize victims to carry forward 100% of any unclaimed losses for up to five years, with 50% of any remaining losses carried forward for an additional 10 years.

Current law also provides that a county board of supervisors may adopt an ordinance authorizing an assessee to apply for the re-assessment of property damaged in a disaster, and that the property owner may apply to the county for deferral of the property tax until the next installment due following the disaster. The county may apply to the state for a "bridge loan" to cover cash flow losses during the period of deferment.

Public Information Contact:

H.D. Palmer
916/323-0648