Fossil fuel companies are profiting off an obscure state tax break depriving California of up to $146 million of annual tax revenue that could be used to combat climate-change-fueled wildfires, according to a new report released amid an inferno tearing through Los Angeles. The tax break has persisted for decades in the Democrat-controlled state even as California has faced deficits and cuts to wildfire preparedness — including recent cuts to the Los Angeles Fire Department’s budget.

During the first night of the fires, firefighters struggled to obtain water from fire hydrants in Pacific Palisades, a neighborhood that had been set ablaze in western Los Angeles. A city council member who represents the Palisades neighborhood blamed the lack of water on “chronic underinvestment.”

The new report, released Wednesday by the Climate Center, a think tank focused on California climate solutions, details how oil and gas companies and their allies used campaign donations, lobbying dollars, and legal pressure to establish a tax loophole that allows corporations to reduce their taxable state income by avoiding reporting foreign profits and losses, if the company elects to do so.