In this case I think the state is going to have to pony up. It could take some time but there's lots of actors in this that didn't do the right thing. The company that owned the dam is most likely not going to be able to afford the damage. But from what I understand the company was sued by the state when they lowered the water level to mitigate the risk and were forced to raise it back up. Usually when something is declared a federal disaster there's money available. Hopefully it works out for him.