LAKE COUNTY — Gov. Gavin Newsom announced last week that he would sign a bill to draw $31.3 million from next year’s state budget to backfill property tax revenues lost due to destructive recent wildfires in Lake and Butte counties.
Of that amount, $3.8 million is being directed toward Lake County to replace tax dollars lost from structures destroyed in major blazes that took place between 2015 and 2018, including the Rocky, Jerusalem, Valley, Clayton, Sulphur, Pawnee and Mendocino Complex fires.
Combined, those fires burned down over 3,000 structures and damaged many more, eating up roughly 5 percent of Lake County’s housing stock. The ensuing low property tax revenues have contributed to the county’s flailing budget, which Lake County Administrative Officer Carol Huchingson has called a “fiscal crisis.”
Huchingson told the Record-Bee this week that the funds promised by Newsom would be a “big help to our general fund shortfall,” although certainly not enough to remedy the county’s lack of money.
The property tax backfill is for losses to be incurred in the 2018-19, 2019-20, and 2020-21 fiscal years, and will likely make its way to the county on a yearly basis, Huchingson said.
Though it hasn’t been determined, the method of acquiring the state funding could look like it did the last time Lake County received property tax backfills.
“If this is done the same way it was done when we got the one year of backfill for the Valley Fire back in 2016,” Huchingson said, “we had to submit a claim to the California Department of Finance” to justify costs.
H.D. Palmer, Deputy Director for External Affairs at the California Department of Finance, told the Record-Bee that Lake County will have to submit invoices to the state for review. If everything is in order, checks will then be cut to the counties on an annual basis. “This is something the state has done in the past,” Palmer said, noting the Wine Country Fires of 2017 as the most recent example.
The goal of the offsets, Palmer noted, is that “because homes have been severely damaged or lost, that’s a reduction in the property tax base which funds local schools” and much more. “To offset the anticipated loss … the state has come in to provide financial assistance to Lake and other counties.”
By highlighting local schools, Palmer dovetailed into Newsom’s announcement last week regarding the tax backfill.
Visiting an elementary school in Magalia near the Camp Fire burn scar, Newsom said then, as the Chico Enterprise-Record reported, that “we signed legislation on Wednesday committing something the state of California has never committed to any community and that’s three years to offset and backfill 100 percent of the property tax losses of this community and also to do the same for the school system.”
Palmer noted that Newsom had “wanted to make sure it was very clear that this was on the front burner in terms of priorities for the state.” The governor’s proposed budget for the upcoming fiscal year includes other wildfire prevention and resiliency-focused measures like upping the state’s portion of debris cleanup cost-sharing with counties, and funding additional Cal Fire engines and staff.
Newsom has not been the only California politician pushing wildfire-focused state financial relief for counties. Sen. Mike McGuire and Assemblymember Cecilia Aguiar-Curry both lobbied heavily for property tax backfills, and released a joint press release last week after the senate approved AB 72, which allows the backfills to be appropriated from state funds.
