McGuire: State needs to backfill lost tax money from Northern California fires

Sonoma, Napa, Mendocino and Lake counties are facing tens of millions in tax dollar losses from October’s firestorms, but state financial aid could ensure the counties are able to maintain services, according to state Sen. Mike McGuire.

State officials are awaiting firm loss figures from county and city governments as well as public entities such as fire districts to use for a legislative proposal for reimbursing the losses, said McGuire, D-Healdsburg. Sonoma County officials will seek lost property taxes as well as lost sales and bed taxes during the nearly two weeks last month the county virtually shut down during two massive fires, subsequent evacuations and hundreds of newly homeless residents.

“It’s been evident for weeks the state is going to need to backfill property tax dollar loss to ensure continuity of service now and into 2018,” said McGuire, adding that the help would be needed for additional years. While not yet an official proposal, McGuire said he was hopeful state officials recognized the significant disaster needs in the Northern California counties. The state financial action would be similar to the aid given Lake County following the 2015 Valley fire.

October’s fires brought unprecedented destruction to Sonoma County, where the Tubbs and Nuns fires wiped out more than 5,100 homes, and killed 23 people. The Tubbs fire now is the most destructive fire in state history and the costliest in U.S. history. But Napa County’s Atlas fire and Mendocino County’s Redwood fire also resulted in deaths and the loss of hundreds of homes. Lake County this year had damaging, but smaller fires.

Sonoma County Supervisor James Gore said a preliminary estimate is $30 million in property tax losses countywide with $10 million of that the county’s share. The city of Santa Rosa expected a $1.5 million property tax loss, said Debbie Lauchner, chief financial officer.

The hardest hit fire district was Rincon Valley with an estimated $1 million loss in property and parcel tax money from the incineration of at least 1,500 homes.

“The irony of a big fire is that it shuts down your fire station, or reduces staffing,” said Rincon Valley Fire Chief Jack Piccinini. “That’s the only place we can go with a million dollar hit. It’s really important we come together and try to develop a united message to get local, state and federal resources to help us address this two-to-five-year issue.”

In Sonoma County, fires also burned hundreds of homes in the Kenwood, Glen Ellen and Bennett Valley fire districts, as well as Mayacamas, Knights Valley and Mountain volunteer fire company jurisdictions. Fire officials are awaiting county calculations to learn the depth of their projected budget deficits.

“It could affect our ability to provide service the same as we’re providing now,” said Steve Akre, Sonoma Valley Fire District chief. The district this year covers firefighting in Glen Ellen, which lost a total of 183 homes, or 12 percent of Glen Ellen’s 1,500 parcels and $1 million budget.

State bailout efforts could duplicate a financial aid plan used to help in Lake County after the Valley fire, which burned 76,000 acres, killed four and gutted several Lake County communities.

“We had a successful effort to backfill Lake County in 2015,” said McGuire. “We would like to be able to repeat that action in the four-county region.”

Lake County’s financial aid included $2 million annually in forgiven costs to the South Lake County Fire District for its firefighting contract with Cal Fire. The fire’s path in 2015 destroyed almost 2,000 structures and much of that district’s jurisdiction, which covers Hidden Valley, Middletown, Cobb and Loch Lomond.

The state aid will carry the district through 2018. But fire officials now are scrambling to prepare for a subsequent budget deficit as rebuilding so far totals just one-quarter of the homes lost, according to South Lake County Fire Chief Greg Bertelli, who also is the Cal Fire division chief for Lake County. Cutbacks on the table include station closure, reduced ambulance service or mutual-aid agreements.

“The state really did help tremendously,” Bertelli said. “Now it’s, ‘What are we going to do to increase our revenues to break even?’ The last thing we want to do is go to the voters and ask for more.”

Carol J. Huchingson, Lake County’s administrative officer, said the county continues to struggle from the property tax losses from five wildfires in the past 25 months. She estimated the county’s rebuilding effort would increase to 17 percent by July 1, 2018. It’s now only 10 percent complete, she said.

“All total, in all these wildfires, we have lost more than 1,650 homes,” Huchingson said. “This is truly unprecedented for a small county.”

Afraid of facing a similar budget scramble, Sonoma County fire officials say they need more than just a year or two of breathing space.

“There’s such a big loss of homes, trying to get those rebuilt in three-to-five years is unrealistic,” said Bennett Valley Fire Chief Dan George.

“Can Bennett Valley or Glen Ellen wait five, seven years to get their property tax back? That would be devastating.”

In Bennett Valley, mainly on Bennett Ridge, at least 120 homes burned - nearly 15 percent of the district. George anticipated the tax losses could be more than $100,000 of a $900,000 budget.

“If we don’t get that money we’ll cut some positions,” he said. “We’ll lose some part-time folks probably.”

Losses aren’t yet known for the county’s three volunteer companies, which prior to the fire brought in $250,000 in firefighting property tax money, said Jim Colangelo, administrator of the Sonoma County Fire and Emergency Services Department, which manages them. He expected a significant cut to that money, which goes into a pot to fund the county’s 11 volunteer companies.

“We were trying to figure out how to get more money to improve services. Now we have to figure out how to get more money to maintain existing levels,” Colangelo said.

Officials from the four affected counties are expected to provide dollar loss amounts early next week for a meeting with state officials, McGuire said.

How the state will pay the tax losses remained part of the equation, but the senator said options include a state budget surplus.

Gore said he was heartened to hear of the possible state aid. He said supervisors at their Dec. 5 meeting expect to get a full financial evaluation on the fires’ impacts to the county.

Meanwhile, California’s elected state and federal officials continued pushing to get California’s unprecedented fire losses included in a $44 billion federal disaster aid bill, which so far focuses on hurricane victims in Texas, Florida and Puerto Rico. California has asked for $7.4 billion of that bill for disaster relief.