BILL NUMBER: SB 395	AMENDED	05/22/95
	BILL TEXT

	AMENDED IN SENATE   MAY 22, 1995

INTRODUCED BY  Senator Rosenthal

                        FEBRUARY 15, 1995

   An act relating to earthquake insurance, and making an
appropriation therefor.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 395, as amended, Rosenthal.  Earthquake insurance.
   Existing law contains various earthquake study and strengthening
requirements, including notice of earthquake deficiencies upon
transfer of residential property.
   This bill would require the Department of Insurance to establish a
program for residential grants and loans to help pay for the
retrofitting of high-risk residential dwellings owned or occupied by
low- and moderate-income households in order to minimize the risk of
earthquake damage to those dwellings and thereby reduce the costs of
residential earthquake insurance.  {- The -} {+
   The +} bill would appropriate {- $5,000,000 -} {+ $4,400,000 +}
from the California Residential Earthquake Recovery Fund to the
Department of Insurance for the purposes of the bill. {+  The funds
would be available until July 1, 2000, when the program would become
inoperative. +}
   Vote:  majority.  Appropriation:  yes.  Fiscal committee:  yes.
State-mandated local program:  no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  The Legislature finds and declares as follows:
   (a) Many homeowners could significantly reduce their risk of loss
from the peril of earthquake by retrofitting their homes in
conformance with appropriate building and safety codes, including,
but not limited to, securing the dwelling to its foundation, bracing
of walls, and the strapping of water heaters.
   (b) Reduced earthquake insurance premiums, reduced deductibles, or
increased coverage may be feasible as a result of home retrofits
that reduce the risks associated with earthquake damage.
   (c) It is in the public interest to provide financial support to
help the owners of residential dwellings, particularly low- and
moderate-income households, who reside in high-risk dwellings, pay
for the costs of home retrofits to help reduce the risk of damages
caused by earthquakes.
  SEC. 2.  The Department of Insurance shall establish a program for
residential grants and loans to help pay for the retrofitting of high
risk residential dwellings owned or occupied by low- and
moderate-income households in order to minimize the risk of
earthquake damage to those dwellings and thereby reduce the costs of
residential earthquake insurance.  {+ While owner-occupied dwellings
shall be eligible for both grants and loans, dwellings that are not
owner-occupied shall only be eligible for loans. +}  To the maximum
extent feasible, the department shall use the funds to match any
federal funds made available to retrofit single- and
multifamily-residential dwellings.  {-
   No more than 5 percent of the funds implementing the program may
be used by the department for administrative costs. -}
  SEC. 3.  The sum of {- five million dollars ($5,000,000) -} {+ four
million four hundred thousand dollars ($4,400,000) +} is
appropriated from the California Residential Earthquake Recovery Fund
to the Department of Insurance for the program established pursuant
to this act.  {+ During the second half of the 1995-96 fiscal year,
the Department of Insurance may use up to one hundred fifty-nine
thousand dollars ($159,000) for costs of initial implementation and
administration of the program.  Thereafter, no more than two hundred
thousand dollars ($200,000) per fiscal year may be used by the
department to administer this program.
   Money appropriated by this section shall be available for
expenditure until July 1, 2000.  On and after that date, the program
established by this act shall no longer be operative. +}