As Quake Memory Fades, So Do Promises of Funds

The legislative aftershock that followed last fall’s Northern California earthquake has subsided, and in the calm, seismic politics are shifting back to business as usual.

The spotlight is gone now. Six months after the event, television cameras no longer focus on every politician who utters the word “earthquake.” And the task of preparing the state for the “Big One” has returned to the unglamorous trenches.

There is growing concern among lawmakers and local officials in areas hit by the quake that several initiatives launched after the disaster will be left in the lurch.

Among the possible casualties are several efforts aimed at completing recovery from the October quake and preparing for future temblors:

Representatives of 10 Northern California counties shaken by the 7.1-magnitude Loma Prieta earthquake have acknowledged that they will not get all of the $3 billion in aid they say they need to rebuild their communities.

Money for an ambitious effort to make government buildings throughout California safe in a major temblor already has been scaled back by two-thirds.

Gov. George Deukmejian has yet to deliver to the Legislature a proposal for mandatory earthquake insurance on risky property, which he pledged in his State-of-the-State address in January.

In most instances, the culprit is money--not enough of it to go around. The state already is $1.9 billion short of what it needs to pay for all current operations next year, and lawmakers seem in no mood to cut existing services to pay for earthquake-related programs. The government’s capacity to borrow by floating bonds has been nearly exhausted by needs that the governor and legislators deemed more urgent: prison construction, schools and mass transit.

“We know what needs to be done,” said L. Thomas Tobin, executive director of the state Seismic Safety Commission, who remains optimistic about the chances for significant progress on earthquake preparedness this year. “We know who needs to do it. What we don’t know is how to pay for it. But we know we either pay now or we pay later.”

As the memories of Oct. 17 fade, the political will to face up to the earthquake issue grows weaker.

“People tend to forget, to go on to more important events in their lives. The window of opportunity is shutting very rapidly,” said Democratic Assemblyman Rusty Areias of Los Banos, chairman of the Assembly’s new earthquake committee, which held its first hearing recently in one of the Capitol’s tiniest meeting rooms.

The picture, however, is not entirely bleak.

The temporary quarter-cent sales tax approved by the Legislature and the governor in November had generated more than $100 million for quake relief by the end of February, and the state and federal governments had committed $561 million to the effort, according to the state Finance Department.

Prompted by the death and devastation at the collapse of the Nimitz Freeway in Oakland, the Legislature allotted money to boost the Transportation Department’s lagging 18-year effort to whittle away at a backlog of freeway structures considered too weak to withstand a major quake. The first projects funded by the new money are expected to begin within months.

Deukmejian’s proposed budget for next year includes the first funds needed for the construction of a new $10-million Southern California emergency operations center, which would be the state’s command post in the event of a major quake. The governor also proposed spending $1.5 million to survey seismic dangers in state-owned buildings and $2.3 million to expand existing earthquake preparedness projects in the Bay Area and Southern California.

And there remains a heightened interest in earthquake issues, judging from more than 150 bills on the subject that are in the legislative hopper. Among the measures moving forward are proposals to require the bolting of homes to their foundations upon sale and to grant a tax credit to encourage private property owners to buttress their buildings against the effects of major quakes.

But six months after the third-deadliest California quake of this century, there is little evidence that the higher level of interest will be matched by action.

For example, a recent report by 10 Northern California counties claimed to document nearly $3 billion in “unmet needs” from the October earthquake. Although more than $1 billion of that total involved earthquake preparedness measures unrelated to the last quake, the remainder still represents an impressive burden that local governments say they are unable to shoulder.

The toll included $46 million to continue temporary housing programs for low-income people who lost their homes in the quake. Another $277 million is needed to replace more than 10,000 low-cost hotel rooms and other dwellings destroyed or seriously damaged in the disaster. Other costs were attributed to the increased need for social service programs, a shortfall in tax revenue and the expense of making rebuilt or repaired structures safer than they were before the damage.

Recognizing the state’s fiscal predicament, governmental leaders from the affected counties say they have pared their list of priorities to the bare essentials and presented the Legislature with a three-point program that would cost taxpayers about $700 million.

“We had to make a request that was realistic,” said Dan Wall, a lobbyist for the County Supervisors Assn. of California. “If we sashay over to the Legislature and ask for $2.9 billion, we aren’t going to get very far.”

A key part of the counties’ request calls for the creation of a permanent, “revolving” loan fund that could be used to help the Northern California counties recover from this disaster and then be available for the victims of future calamities. Proponents hope this strategy will help attract votes from Southern California lawmakers leery about dishing out more money to the earthquake victims.

“The obvious lesson from this quake is that you are going to get yours, and it’s only a matter of time,” said Santa Cruz County Supervisor Fred Keeley. “Today’s Loma Prieta earthquake is tomorrow’s fire in the Sierra and the next day’s earthquake in Southern California.”

Still, with money as tight as it is, Wall said the counties would be lucky to get half of what they’re asking for.

“The best of all worlds would be if we could get $700 million,” he said. “If we could get a significant portion of that, it would be something to be thankful for.”

Wall is basing his judgment in part on experiences like that of state Sen. Art Torres, a Los Angeles Democrat who has been pushing for greater funding to repair and strengthen government buildings considered hazards in a major quake. Before the October temblor, Torres already had proposed a $900-million bond measure for that purpose. State officials say the need is probably close to $2 billion.

But after legislative leaders and Gov. Deukmejian met privately and divvied up the bond-issue pie, the earthquake program was cut to $300 million. Torres described the reduction as “penny-wise and pound foolish.”

“This Legislature is constantly crisis-oriented and not planning for the future, and the governor is worse,” Torres said. “We live on a part of God’s world that is constantly moving. To reject that notion is just folly in terms of not being prepared. It’s sad and tragic that we are going to allow time to pass again and not address this problem.”

The bond measure, Proposition 122 on the June 5 ballot, would provide $250 million for state buildings and $50 million for local government. The money would go to repair, strengthen, rebuild or replace government-owned buildings considered unsafe in an earthquake.

A spokesman for Deukmejian said the governor and legislative leaders jointly agreed on the $300 million figure, which was endorsed by wide bipartisan majorities in each house of the Legislature.

“Earthquake retrofitting is a long-term project,” said Robert Gore, Deukmejian’s press secretary. “We regard this as a beginning. It’s a rational approach.”

The Administration is also wrestling with the problem of earthquake insurance and apparently is struggling to find a way to live up to Deukmejian’s pledge to enact a mandatory earthquake insurance program before he leaves office at the end of this year.

“No earthquake rebuilding effort will be complete or responsible until we make earthquake insurance coverage a mandatory feature of all policies written for at-risk privately owned buildings,” Deukmejian said in his final State-of-the-State speech in January.

But the Administration has yet to introduce a proposal on the controversial and complicated issue. John Sullivan, undersecretary of the Business, Transportation and Housing Agency, said the agency has all but abandoned plans to impose the requirement on businesses and is focusing on single-family housing instead.

But even that limited approach would be a monumental undertaking.

The problem is that any attempt to insure against earthquake damage must include a very high deductible to protect the insurance industry from the enormous financial risk. In today’s market, the typical policy includes a deductible of 10% of the value of the insured property. Under such a policy, the owners of a $200,000 home are responsible for the first $20,000 in damage to their house--not a great comfort for the insured.

Sullivan declined to give details of the Administration’s possible approaches. But legislative sources said one method the Administration is studying would provide a policy aimed at covering just the amount homeowners now face in deductibles. But an industry trade group official said the state probably would find such an approach unaffordable because the financial exposure from a catastrophic Southern California quake would run into the tens of billions of dollars.

“The state is going to realize that they are talking about an awful lot of money,” said Edward Levy, general manager of the Assn. of California Insurance Companies. “If you really want to provide protection for the Big One, it is a huge figure, a very sobering figure, even in a state the size of California.”

Democratic Assemblyman Patrick Johnston of Stockton, chairman of the Finance and Insurance Committee, said the Legislature is unlikely to tackle the issue without leadership from Deukmejian. “The ball is in the governor’s court,” he said, adding that he knew of no current proposal that could broaden coverage at affordable rates.

“We await some word from the Administration,” Johnson said. “Absent them putting forward or embracing a proposal, I don’t expect this session to end with any major change.”