State may boost loan funds available to flooded area

The state may make millions of dollars more available to help rebuild flood-damaged Washington County, legislative leaders said Thursday — money that would be in addition to $25 million loan already announced.

New details of the aid package promised a day earlier by the Legislature and Gov. Jon Huntsman Jr. were brought to members of the GOP Senate caucus on Thursday, including the possibility that up to another $15 million may be borrowed.

"It's up to us," Senate President John Valentine, R-Orem, told members of the majority caucus after describing the terms of the $25 million loan as well as the likelihood more money will be needed. "We can cut a check."

The Senate caucus, as is customary, did not take a vote although no member spoke against the package. The House GOP caucus voted unanimously to support the loan, virtually ensuring its passage.

House budget chairman Ron Bigelow, R-West Valley, will carry the bill, which could come up for a vote Friday or early next week, as soon as it is drafted. The $25 million will come out of an estimated $240 million the state has in one-time surpluses this year.

That means some other roads and/or buildings planned for won't be constructed with that cash. Valentine said leadership is recommending that the loan would be for one year, with an interest rate of 2 percent. However, he said at least part of the debt could be forgiven by lawmakers next session.

And while officials already pledged that local governments in southern Utah would be allowed to tap into the state's revolving loan fund to repair water, irrigation and sewer lines, Valentine suggested the fund, now at about $6 million, might not be enough.

He said there may be between $13 million and $15 million in projects that would be financed through the loan fund. That would mean an additional appropriation would be needed to boost the size of the fund, already used by local governments throughout the state.

What lawmakers aren't willing to do yet is offer assistance to homeowners. Some lost everything when their homes were swept into the swollen Santa Clara River during the deadly flooding earlier this month.

Valentine said there are concerns about setting a precedent, citing mudslides, fires and other disasters that have also resulted in the loss of private property. The state helped out after the 1983 floods in Salt Lake City but only with public projects.

Other concerns were raised in the House.

"This is a slippery slope," said Rep. Kory Holdaway, R-Taylorsville. "We're setting precedents here."