Home Programs Emergency management Recovery DFAA Manual to assist in the interpretation of federal guidelines EPC 22/88 Interpretation - General Principles

Interpretation - General Principles

1. Repair of damage to property is generally the responsibility of the owner of the property. However, in a major disaster, damage can be so widespread that governments (municipal, provincial, federal) offer assistance to help restore the property to its pre-disaster condition.
2. The Disaster Financial Assistance arrangements become applicable when financial assistance in recovering from a disaster has been requested by a provincial government and the request has been agreed to by the federal Minister Responsible for Emergency Preparedness. Federal assistance is then provided in accordance with the guidelines for administration of the Disaster Financial Assistance arrangements. The dollar value of the assistance is calculated by applying the formula presented in Chapter I, paragraph 2, to the total of costs eligible for federal financial assistance.
3. Provinces may provide more generous assistance than the federal arrangements permit. In this circumstance, federal assistance is limited to that portion eligible under the guidelines. The decision of the Executive Director of OCIPEP regarding eligibility is final.
4. In assessing eligibility for federal assistance, the following factors must be taken into account:
   1. the province involved must have incurred the expenditure (i.e. paid out money)
   2. requests for assistance must be on a net cost basis. That is, costs of restoration must be reduced by the amount of any recoveries or other financial assistance received.
5. Given that the aim of the federal arrangements is to provide basic assistance to restore public works to their pre-disaster condition and to facilitate the restoration of essential, personal property of private citizens, farmsteads, and small businesses, certain items are not eligible. These are covered in Chapter III, paragraph 13, of this manual and are further defined as follows:
   
   1. Any damage for which costs could be recovered through insurance or at law. Any damage for which insurance coverage was available (whether or not it was purchased) at reasonable cost, is not eligible. Reasonable cost may be assumed if insurance policies are generally available to the public and have been well subscribed. For certain unique losses, an investigation should be carried out to determine whether insurance coverage could have been purchased and whether the rate would have been reasonable, given the type of loss incurred relative to the activity in which the owner was engaged. In questionable cases, eligibility will take into consideration written statements of provincial emergency preparedness officials or the Insurance Bureau of Canada. With respect to recoveries at law, this would apply in a case where the disaster was caused by a non natural occurrence for which proceedings under law could be brought against an individual, corporation or government.
   2. Costs for which provision is made in whole or in part under any other government program. This provision has been generally brought to bear in cases where crop damage was incurred. It should be noted, however, that other types of damage could occur for which compensation is available under other government programs. With respect to crop damage, the federal government operates an "umbrella" program of crop insurance-through federal-provincial agreements. This program allows the province to designate certain crops under the federal program as eligible for insurance. Farmers then elect for coverage through the province. Interpretation in the past has been that crop damage is not eligible for federal financial assistance if the specific crop could have been covered under the federal umbrella program. Cases have arisen where the crop could have been covered under the federal program but the province did not opt into the program for that specific crop. In these cases, the attitude has been that insurance coverage could have been available and therefore, these expenditures are not eligible for federal assistance.
   3. Damages to property or facilities for which assistance was previously available to prevent such damage. This provision refers to such areas as those in which the federal and/or provincial governments have carried out flood prevention works or where other preventative programs have been put in place. The Red River area program of dyking and raising to levels defined by the 100-year flood plain is an example. However, should a flood occur which brought flood levels to above the 100-year level, Red River Valley residents would be eligible for assistance.
   4. Damages that are an ordinary or normal risk of a trade, calling or enterprise. This provision has not been invoked in any disaster for which assistance has been provided under the arrangements to date.
   5. Costs incurred for restoration or rehabilitation which cannot be considered essential to the restoration of an individual to his/her home or livelihood or the reconstruction of essential community services. This is a broad provision and what has been deemed "essential" is dealt with under the more detailed interpretations in subsequent chapters.
   6. Costs incurred for the restoration of property owned by large businesses and industries. This is covered under specific interpretations relating to business.
   7. Costs that can be considered normal operating expenses of the government department or agency concerned, including maintenance budgets. This is covered under the public sector interpretations.
   8. Provincial taxes. Since the signing and coming into force of the Federal-Provincial Reciprocal Taxation Agreement in 1977, (renewed 1987) this provision does not apply to those provinces party to those agreements. Provincial tax costs are eligible costs for those provinces (Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland, Manitoba and British Columbia).