LINDA, Calif. — California taxpayers gave hundreds of thousands of dollars last month to Wayne Hall and his son, Dale, 19 years after a flood submerged their butcher shop in 6 feet of water. The settlement resolved a bitter legal battle so prolonged that nearly 500 victims of the disaster died waiting for similar payments.
The money -- "a nice check," said Wayne, though he won't disclose the figure -- settled the Halls' damage claims from a 1986 levee break that destroyed thousands of dollars worth of meat and all but the shell of their shop near Marysville, north of Sacramento.
In all, California taxpayers will pay $464 million to nearly 3,000 people and their heirs, as well as businesses and their insurers, affected by the collapse of a section of earthen mound along the Yuba River. The total is more than the annual budget of the state Department of Parks and Recreation, the state Department of Fish and Game or the state Energy Commission.
Officials fear the court ruling that spurred the settlement will lead to giant payouts of tax dollars to flood victims in the future. The June ruling found the state liable for damages from the collapse of the 101-year-old levee.
"I think it is going to have long-lasting and rather severe financial effects on the state of California," said Assemblyman Tom Harman (R-Huntington Beach).
Most of the settlement money is for interest accrued over nearly two decades while the state refused to settle. Shortly after the flood, overall damages in the relatively poor towns flooded were estimated at $100 million.
The state had a billion-dollar surplus at the time but argued in court that it was not liable for the damages. This year, the cash-strapped state borrowed most of the settlement money from Merrill Lynch & Co. The state has disbursed $36 million and is to pay back the rest with interest over the next decade.
Gov. Arnold Schwarzenegger's staff said he has asked for legislation to blunt such liability in the future, concerned that it could siphon money from schools, roads and other government services. A bill is in the works, but it has run into resistance from landowners, developers and local agencies that maintain levees, as well as most Republican lawmakers, who opposed the property fees the proposed legislation once contained for levee improvements.
