Calif. quake fund tax break sought in Congress.

National Underwriter Property & Casualty-Risk & Benefits Management, June, 1996

SACRAMENTO--A Southern California congressman has introduced federal legislation that would restore a critical tax break to the proposed $10.5 billion California Earthquake Authority, a move that appeared to infuse new life into the troubled negotiations over the state-run, publicly financed pool.

The bill, sponsored by Rep. Jerry Lewis, R-Los Angeles, would reinstate the exemption the Internal Revenue Service withdrew last month. In earlier negotiations, the IRS had said it would allow the pool's assets to be exempt from federal taxation, meeting a condition that insurers participating in the CEA said was necessary to the success of the enterprise. But in a two-line statement issued May 2, the IRS said it had changed its mind "pending further review." (See NU,...

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