Valley Commentary : Stop Making Our Children Pay Twice for Disaster Aid : The Valley Industry and Commerce Assn. thinks it is time for us to take on an admittedly big financial responsibility and stop sticking it to our kids.

For the next 30 years it will cost America’s children and grandchildren $377 million a year in interest alone to pay back the money the federal government had to borrow for relief after the Northridge earthquake. By the time the 30-year bonds the government sells to cover the deficit mature, the total cost of the $7.2 billion in aid will have tripled.

In the last four years, Congress has borrowed more than $72 billion to finance disaster aid and is paying interest of $1.5 billion a year. That is enough to put 15,000 police officers on U.S. streets.

Doesn’t it make sense to stop burdening our children and grandchildren with expenses that should be ours? Doesn’t it make sense to plan and budget for these expenses? It is time for us to take responsibility for our disasters, pay as we go and stop sticking it to our kids.

The Valley Industry and Commerce Assn. thinks it is. And the association, representing 350 businesses and affiliates that employ more than 150,000 people in and around the San Fernando Valley, is urging Southern California legislators to lead the way.

VICA has proposed that an insurance trust fund be created and that it be funded by charging a 1% surtax on personal and corporate income taxes. The money could be spent only for natural disasters, acts of God. An area would have to be declared a disaster by the President, and Congress would have to approve any expenditures. If for some reason the fund did not have enough money to cover the cost of applicable federal aid, Congress would be authorized to borrow money to lend to the trust for five years.

The proposal would not change the law governing what kind of assistance would be granted, so expenditures would not go up. It would simply create a new funding source.

A 1% surtax--an additional payment of 1% of the tax for that year--would cost the average taxpayer $72 a year. The Northridge earthquake would be paid for in one year instead of 30.

Yes, this would be a new tax. But the net effect would be to reduce taxes, because paying as we go is much less costly than “charging it.”

A skeptic might ask, “Why not just use the money from a surtax to lower the deficit?” It is true that the net effect would be the same, but the American public is understandably mistrustful about Congress’ willingness to use additional taxes to lower the deficit. A dedicated insurance trust fund would be off-limits to a Congress desperately seeking funds.

Some people believe there is nothing wrong with financing disasters over a long period, since much of the money is used for rebuilding infrastructure such as roads and buildings. While this argument has merit, paying three or four times the actual cost does not. Why should our children have to pay twice?

A bipartisan effort among local lawmakers would be a welcome change. Southern Californians would be trendsetters, departing from our preoccupation with immediate gratification out of concern for future generations.