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House approves disaster‑recovery loan account bill to help local governments after declared disasters
Summary
The House passed HB12 to create a disaster‑recovery loan account for local governments, funded through the state's disaster recovery fund; eligibility hinges on prior participation rates and loans carry tiered repayment terms tied to local participation.
Representative Oda moved to uncircle and amend House Bill 12, which would establish a loan account funded from the state's disaster-recovery fund to provide short-term loans to local governments after a declared disaster.
"What the bill does is to set up a fund that will be funded through the disaster recovery fund, to set up a loan Account for local government cities county special districts if there's a local disaster," Representative Oda said, describing the program's purpose to provide repair funds and match assistance for emergency response.
Eligibility and incentives are layered. Oda explained qualifying local governments must meet a participation threshold based on deposits into a local disaster account: "For them to qualify they would have to have a at least a 50% participation average over the last 5 years," he said. He outlined a sliding repayment schedule to reward higher participation: if a locality reaches 90% participation, repayment is at state prime rate with no surcharge and a maximum payback of 10 years; if participation is 70–90%, repayment is state prime plus 2% with a 5‑year maximum; at 50–70% participation, repayment is state prime plus 5% with a 3‑year maximum.
The bill also ties loan priority to filing order if multiple applications are received and reserves state priorities: "the state's needs would take priority over any of any local government," Oda said. Loans could be used to repair infrastructure and to meet FEMA cost‑share match obligations (FEMA currently requires a 25% local match).
After presentation and brief questions from members, the House voted. "House Bill 12, having received 72 yes votes, 0 no votes, passes this body and will be transmitted to the Senate for its consideration," the Speaker announced.
Next steps: HB12 will be transmitted to the Senate; sponsors and administrative divisions (Division of Emergency Services, Lieutenant Governor's office for notice procedures, and others) will implement application and priority rules if the bill becomes law.
