Legislators Balk at Flood Project Outlay : Public works: If the state does not begin to make good on its part of the $1.4-billion Santa Ana River plan, property owners in the zone may be assessed up to $60 yearly.

Faced with a huge budget deficit, state lawmakers are balking at the idea of paying the first $32-million installment toward the Santa Ana River flood control project, an expensive undertaking needed to protect most of Orange County’s residents from a major flood.

And local flood control officials are warning that if the state does not begin to make good on its promise to pay for part of the $1.4-billion public works project, they may have to consider imposing an annual tax of $40 to $60 on each county property owner in the flood zone for 20 years.

“If they don’t do anything this year,” Nick Mastrocola, project manager with the Orange County Flood Control District, said about legislators, “I would say it would be a critical signal to us, and we would forge ahead on the assessments.”

The flood project is considered by federal engineers to be the most crucial of its kind in the western United States. Authorized in 1986, the project would guard against a 200-year flood by increasing the storage capacity of two reservoirs in San Bernardino and Riverside counties and deepening the river channel as it runs for more than 30 miles through Orange County to the sea. A 200-year flood is one so severe it could be expected just once every 200 years.

While the project would benefit all three counties, the biggest payoff would be in Orange County, where the Army Corps of Engineers estimates that $14.5 billion in property and potential business losses are at stake in addition to the lives of people living and working in the flood zone.

The flood zone extends along both sides of the channel’s 100-mile course, which begins at the San Bernardino Mountains and cuts through north and central Orange County until the river flows into the ocean between Huntington Beach and Newport Beach.

The county’s share in paying for the project is $440 million. The state has already agreed to reimburse the county 70%--or about $308 million--and Gov. George Deukmejian included the first $32-million installment in his proposed 1990-91 budget.

But some lawmakers say the installment for the river project will have to be dramatically reduced or cut altogether. The reason: Estimates show that unless some drastic cuts are made, Deukmejian’s proposed budget for next year will come up $3.3 billion short.

“We’re evaluating this project on its merits,” said Assemblyman Jack O’Connell (D-Carpinteria), chairman of a Ways and Means subcommittee examining the flood project. “It’s competing not only with other projects of this nature . . . but with money that could be diverted to public education, health care and other things in the budget.”

O’Connell also said the more immediate need for new schools--coupled with the severe drought the state is suffering through--makes the plan to spend $32 million for flood control seem less vital.

“Perhaps it could be deferred a year, given the fact that we’re in the fourth year of a drought, and we have 40,000 more youngsters entering school,” he said.

That kind of delay, however, has county flood officials worried. Without money from state coffers, they say, funds will run out within three years to pay for local preliminary work needed before the Corps of Engineers can expand the dams and deepen the river channel.

Mastrocola, the flood district manager, said the state is already $19.3 million behind in payments for its share of the preliminary work performed to date. The continuing preliminary work will include condemning or moving houses, utilities, bridges and roads.

If O’Connell and his colleagues decide to wait another year to pay, the delay “will just shift the (financial) burden to the citizens here,” Mastrocola said. “We’ll have to rely on assessing the property owners if the state can’t come through with their deal.”