Deal Reached For $167 Million In Flood Relief

ST. PAUL, Minn. (AP) — Minnesota Gov. Mark Dayton on Wednesday called a special session for Friday so the Legislature can vote on a $167.5 million relief package for Duluth and other Minnesota communities ravaged by summer floods and other storm damage.

The package contains money to rebuild roads and other infrastructure, offer low-interest loans and other help to homeowners, and put up the state's match for federal disaster aid after floods and windstorms hit northeastern Minnesota, central Minnesota, counties on the southeastern edge of the Twin Cities and north-central Minnesota in June and July.

Devastating flash floods swept through Duluth when 10 inches of rain fell over two days in mid-June, washing out entire roads, overwhelming storm drainage systems and killing 11 animals in the barnyard exhibit at the Duluth Zoo. The water moved south, flooding basements and prompting evacuations in Barnum, Thomson and Moose Lake. Less than a week earlier, windstorms and flooding caused extensive damage in central Minnesota and counties southeast of the Twin Cities.

State emergency management officials have estimated that damage to public infrastructure will top $150 million. Some 1,700 homes sustained damage and few homeowners had flood insurance.

In early July, windstorms damaged power lines, trees and state parks in north-central Minnesota, but the damage wasn't enough to qualify for federal aid.

The Democratic governor and Republicans who control the Legislature have negotiated for weeks on a relief package. On Wednesday, they struck a deal just minutes before Dayton appeared at a Capitol news conference, where his staff handed out copies of an agreement signed by Dayton and the four top legislative leaders.

"We're hopefully going to provide a safety net to help people survive this," Dayton said.

The agreement limits the special session to a 17-hour window starting at 2 p.m. Friday and restricts floor votes to the flood bill and technical corrections. It also blocks rank-and-file lawmakers from making changes to the flood package before they vote on it. The governor, who has sole power to call a special session, insisted on the agreement before summoning lawmakers to the Capitol. Once a special session convenes, the Legislature has exclusive power to adjourn.

Minnesota received a presidential disaster declaration that brings federal coverage for 75 percent of the cost of repairing damaged public infrastructure in 15 counties and on three Indian reservations. But the Federal Emergency Management Agency turned down a request for individual assistance for homeowners and business owners. Homeowners and business owners in three northeastern counties and on one reservation can get low-interest loans after the U.S. Small Business Administration granted a disaster declaration.

The state aid package is about $27 million smaller than Dayton's original $195 million proposal, which drew complaints of "sticker shock" from key Republican lawmakers.

It includes $79 million for road and bridge repairs, $31.8 million for public safety costs, $15 million for economic development grants and $12.7 million for the Minnesota Housing Finance Agency to offer temporary housing aid and low-interest loans for homeowners to repair damage.

"It's going to go as far as possible and it's going to go beyond what FEMA was willing to do with individual assistance," Dayton said.

About $45 million will come from the state's budget reserve. Another $26 million is left over from the last budget period, and the rest comes from various bonding funds.

Dayton said the bill contains a one-time exception that will allow schools to be repaid before the reserve if a November budget forecast shows a surplus. The state owes schools for past delayed payments used to fix deficits.

The floods invaded basements, ruining water heaters, furnaces and other appliances and wiring. They also sent hundreds of tons of sediment into Lake Superior, giving it a distinctive brown tint. Jay Cooke State Park remains closed indefinitely southwest of Duluth after Highway 210 and an iconic swinging bridge washed out.

(© Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)