Yukon residents in flood affected areas will receive full compensation from the government for damage to their homes, Premier Dennis Fentie says.

A second funding source that includes an interest-free loan of up to $35,000 from the Yukon Housing Corporation (YHC) will be provided to owners of recreational properties in affected areas, Fentie told reporters at a press conference this morning.

'The initiative is designed to provide financial assistance to all affected property owners who experienced the impact from high water levels from this spring or summer.

'Grants will be provided to repair damage to principle residences that are full-time homes,' Fentie said.

'The second part (of the initiative) is interest-free loans that will be made up to $35,000 from the Yukon Housing Corporation, I repeat interest-free money, to repair flood-related damage on recreational dwellings and other dwellings that might fall out of the criteria and eligibility of disaster relief.'

The loans will be amortized over 12 years, he added.

This summer, the Yukon experienced the highest recorded water levels in history.

Water levels in the Marsh Lake area were more than 30 centimetres higher than record levels set in 1981 and 54 centimetres higher than the 2004 levels.

Fentie said the government is accepting applications immediately from affected property owners, but did not know what the relief efforts would cost.

'All areas that have been impacted in the Yukon, that have been affected by events this spring and this summer and that would include areas in Liard and other areas, it's all property owners that have been impacted.

'It's an extensive number of properties if you consider it's in Army Beach, South McClintock, Tagish, Laberge, Liard and start adding all that up, it's an extensive number.'

Residents seeking relief are encouraged to contact the YHC and/or the government's website, Fentie added.

'Funding will also be made available to property owners who want to make their dwellings more resistant to the possibility of future high water impacts that we may experience,' he said.

'This could include raising the structure, adding sump pumps to basements and crawl spaces and so on. The funding through all this includes water damage repairs and/or upgrades to septic systems and indeed potable water systems.'

The premier said the Yukon government will pay for all the repairs up front and then negotiating with the federal government to retrieve the money under Ottawa's disaster assistance program, which normally sees a 90 per cent federal/10 per cent territorial funding split.

'I have to say at this juncture that there will be involvement of disaster relief from the federal government, but instead of each individual property owner having to go through an extensive process with the federal government property by property we will engage in this.'

Rudy Couture, the chair of the YHC's board of directors, said this morning this is the first time his organization's Home Repair Program (HRP) has been used for disaster relief.

'The distinct difference from this application of the HRP, normally the HRP has a low interest rate of 2.4 per cent.

'As the premier pointed out it is zero interest and up to $35,000 funding available to make these repairs. I believe (it will) provide good value to those seeking repairs following the damage caused to their dwellings,' he said.

'The 2007 Flood Relief Initiative will remain in place to assist next spring when the thaw comes and the real scope of the flood impacts are better known.'

Marc Perreault, acting director of program delivery for the YHC, said assessments of all affected properties will be undertaken by professionals to determine what is eligible for grant funding and what qualifies for loans.

'The ceiling (for grant funding for principle residents) is the damage that is done to the home.

'If the entire home needs to be replaced, then the entire home will be replaced free of charge to the residents,' he said.

'It's directly proportional to the damage caused to the residence.'

All grant funding will have to follow in line with federal disaster relief guidelines, he added.

Mike Larsen, a Marsh Lake resident who helped spearhead sandbagging efforts in his community, said this morning he feels Fentie's announcement will be well-received.

'That's sounds pretty good on first hearing about it.

'A lot of people were wondering what they were going to do,' he said.

Fentie said in addition to rebuilding efforts the government will also be concentrating on addressing water quality concerns, public health issues and long-term studies on future water levels in affected areas.

'We will be consulting with experts in this matter, for example hydrologists, to get a better understanding of what is possible and what is practicable.'

'In general terms, what I've announced today is that we're going to look at long-term mitigation. What that may mean and the shape of it over time has yet to be determined.'