DENVER (AP) – Residents and officials affected by the Lower North Fork wildfire are asking who might pay if it is found that a prescribed burn set by the Colorado State Forest Service ignited the blaze. At least 28 structures had been damaged and destroyed as of Wednesday.

The forest service said it conducted a 35-acre burn on Thursday to clear fuel on land belonging to Denver’s water authority. The service says an initial review shows all protocols for the burn were followed. The Jefferson County Sheriff’s Office has suggested the burn might be linked to the wildfire and is conducting the official investigation with the Colorado Bureau of Investigation.

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A look at state law on wildfire and potential liability:

Q: What does the law say about liability for damages caused while performing state duties?

A: The Colorado Governmental Immunity Act of 1971 provides immunity for public officials, state agencies and state employees conducting official duties, but waives immunity in certain cases. Exceptions include improper actions by corrections officials or failure to maintain safe highways. It must be determined that a state official or employee was negligent or acting outside his duties before someone could sue the state.

Q: Why does the state have limited immunity from lawsuits?

A: The state and its political subdivisions provide essential public services, and lawmakers are concerned that unlimited liability could disrupt those services or make them too expensive.

Q: Who is covered?

A: All public employees, including elected and appointed officials.

Q: What happens if property owners sue the state and the state is found negligent?

A: The Colorado Governmental Immunity Act limits the state’s liability to $150,000 per individual and $600,000 per incident

Q: What do insurance agencies say?

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A: Insurers say most homeowners have adequate coverage for damages but that many second-home owners of renters do not. Many homeowners’ policies have coverage limits, and they would have to sue the state to obtain further compensation if the state is found at fault.

Q: What federal assistance is available?

A: The Federal Emergency Management Agency will pay part of the costs of fighting fires. In disasters, the agency may provide temporary housing assistance and home repair or replacement assistance with limits. Most disaster aid from the federal government is provided by Small Business Administration loans that must be repaid.

Q: How might that work?

A: The governor can apply for low-interest loans from the federal government and the Small Business Administration for homeowners and businesses, but the state would have to prove state and local governments couldn’t deal with the emergency. An emergency declaration would have to be issued by President Barack Obama at the governor’s request for loans to become available.

– By Steven K. Paulson, AP Writer

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

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– See images from the most destructive wildfire (Fourmile Fire) and largest wildfire (Hayman Fire) in Colorado history.