California lawmakers strike wildfire deal that leaves out most of Newsom’s big demands

Gov. Gavin Newsom on Saturday backed off his proposal to reduce costs for electrical utilities after their equipment sparks wildfires, agreeing instead to a narrower deal after homeowners, insurers and fire survivors argued his original plan would have shifted those costs onto them.

Instead, Newsom and Senate and Assembly leaders agreed on a narrower package of wildfire policies, including prohibiting private equity groups from investing in wildfire claims and denying utility CEO bonuses in the years their companies cause fatal fires.

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The deal is a victory for lawmakers who refused to reduce damages to victims and shift costs away from utilities. Opponents included insurance companies, consumer advocates and survivors of the January 2025 Eaton Fire caused by Southern California Edison equipment that killed 19 people in Altadena.

Under the agreement announced Saturday, the state would create a “fast-pay” program for survivors’ property loss, pain and suffering in the wake of a utility-caused fire. It would include deadlines for determining which claims are valid within 60 days of receipt, and settlement offers within 30 days after that, but survivors could still pursue the long process of suing utilities if they choose.

The state also commits to  improving its local wildfire mitigation efforts and sharing more data on insurance coverage in areas with fire risk.

The final agreement, which lawmakers will vote on next week in Senate Bill 492, caps a contentious series of closed-door negotiations between Newsom’s office and legislative leaders on how much utility companies should pay after fires.

Newsom wanted utilities to have to pay less to insurance companies, some wildfire survivors, local governments and corporations claiming damages after a fire. His administration is concerned the mounting costs threaten investor confidence in the state’s three major for-profit utilities: Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric. He said that could lead to higher borrowing costs for the companies and higher electricity bills for Californians.

Newsom also argued his plan would prioritize paying survivors who lose their homes. In past fires, investors have funded lawsuits or claims have been sold to hedge funds, increasing the number of third parties seeking to profit from wildfire payouts, Newsom’s office has said.

Click here to read the full article in CalMatters

Insurance executives warn that Newsom plan to shift utility wildfire liability would raise premiums

Insurance company executives warned Gov. Gavin Newsom in a letter Wednesday that his plan to shift utility wildfire liability to property insurers would raise premiums across California.

“The party whose equipment ignites a catastrophic fire should bear the economic consequence of that fire,” the 15 executives wrote. “Shifting those costs to policyholders does not reduce the cost of electricity but does make homeownership more expensive and insurance coverage harder to find.”

As the legislative session nears its end, Newsom’s staff and lawmakers have been negotiating behind closed doors on a deal to limit utilities’ wildfire liabilities.

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According to a confidential document that Newsom’s staff sent to lawmakers and was obtained by Politico, the governor wants to stop property insurers from recouping their losses from homes destroyed in utility-sparked wildfires.

That could increase homeowners’ property insurance rates by as much as 50%, according to the Personal Insurance Federation of California. The highest hikes would be for those families living in severe fire risk areas.

“The proposal would shift billions of dollars in wildfire costs away from utilities and onto insurance consumers across the state, making coverage more expensive and harder to find,” said Denni Ritter at the American Property Casualty Insurance Assn.

Southern California Edison and the state’s two other big for-profit utilities have been lobbying Newsom and lawmakers to further shield them and their shareholders from wildfire liabilities ever since last year’s Eaton fire caused the price of their stock to tumble.

Government fire investigators said the fire, which killed 19 people and destroyed thousands of homes, was caused by electrical arcing on Edison’s out-of-service transmission line in Eaton Canyon. Edison kept the line in place despite not using it since 1971.

More than 11,000 households have filed suit against the utility, claiming it acted negligently, which the company denies.

Edison is offering settlements to victims of the Eaton fire. A $21-billion state wildfire fund that Newsom and lawmakers created in 2019 to protect the state’s three big utilities from bankruptcy after a fire is reimbursing Edison for its payments to victims.

At a news conference Wednesday, Newsom defended his plan, which also includes limiting the fees of attorneys in wildfire litigation and stopping hedge funds from profiting on the claims.

Newsom said that current law allows insurers to be paid before victims after a fire.

“The insurance industry is going to do everything to make sure they get paid first,” Newsom said.

Click here to read the full article in the LA Times

Really insulting:’ Campaign to limit settlements stirs frustration among wildfire victims

ALTADENA, Calif. (KABC) — Victims of the devastating Los Angeles fires are dealing with a new headache. A controversial campaign that some utility companies are helping pay for is trying to put a cap on how much settlement money victims get.

Morgan Whirledge, who is rebuilding this Altadena home destroyed in the Eaton Fire, is angry and frustrated as flyers claiming to protect wildfire victims fill mailboxes in his area.

“To try to disguise yourself as being supportive of survivors after what we’ve been through is really insulting,” he said.

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The campaign Wildfire Victims First, which calls on lawmakers to support legislation to reduce the rising cost of wildfires, is paid for in part by Southern California Edison, Pacific Gas & Electric and San Diego Gas & Electric – the same companies accused of starting at least half a dozens of the state’s most destructive wildfires, including the Eaton Fire.

“This will create billions of dollars of more protection for the utilities that they don’t have to pay for wildfire victims in the future,” said Joy Chen, executive director of Every Fire Survivor’s Network.

The group is pushing to limit how much fire victims can receive in lawsuit settlements for pain and suffering, and calling for insurers to carry more of the cost of utility-sparked fires.

Chen, who has met with the governor’s office, says it’s all part of supporting a bail-out bill that Gov. Gavin Newsom is working on behind the scenes.

It comes as SoCal Edison’s profits following the fire jump from $1.3 billion to nearly $4.5 billion. Shareholder dividends are also increasing, along with executive pay.

Fire victims like Whirledge say it all feels like a slap in the face.

“Make us whole and stop trying to deceive us,” he said.

Click here to read the full article at ABC News

The percentage of homes surviving California wildfires is dropping, despite efforts to harden them

At the turn of the century, wildfires destroyed only about 3% of the California homes they came into contact with. By 2020, the rate had risen to 18%, according to a new study from UC Merced.

It’s an indication that decades of efforts to clear flammable plants around homes and fortify their exteriors against flames, heat and embers are being outpaced by increasingly extreme wildfire behavior and construction in fire-prone areas.

“Fires will continue to grow, because climate change has already occurred,” said Mukesh Kumar, a postdoctoral scientist at UC Merced who led the study. “The encouraging message is that we have identified the factors associated with higher survivability — even in California.”

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While the entire American West saw a decrease in the percentage of homes surviving wildfire, California saw a particularly pronounced drop. The findings add to a growing body of research showing the rising number of destroyed homes across the Western U.S. is driven not only by wildfires reaching more properties. but also by homes faring worse when wildfire reaches them.

“That’s really kind of disheartening — that we’ve tried our best to mitigate fires … yet fires are destroying more homes,” said Amanda Carlson, a research scientist with the U.S. Geological Survey who was not involved in the study, but has found similar drops in the percentage of homes surviving in much of the American West.

California has taken significant steps to increase the odds of homes surviving wildfires in recent decades, in response to increasingly destructive wildfires fueled partly by global warming and a history of forest mismanagement.

In 2006, the state expanded fire-safe landscaping rules that require property owners to create separation between trees and shrubs and remove dead vegetation. The rules, which previously applied within 30 feet of homes, were extended out to 100 feet.

Two years later, California adopted a set of wildfire building codes for all new construction, including the use of fire-resistant materials for the outer walls and roof, multi-paned windows that are less likely to shatter in extreme heat and vent covers to prevent embers from sneaking into homes.

Now, the state is developing even stricter landscaping requirements within five feet of homes.

Click here to read the full article in the LA Times

State and Local Government Behind Slow Recovery From 2025 L.A. Wildfires

A year and a half on, the policy failures are compounding the disaster’s effects.

A year and a half has now passed since deadly wildfires devastated several Los Angeles communities. The Palisades Fire swept through one of Southern California’s most scenic and affluent neighborhoods, the Pacific Palisades. Meanwhile, the Eaton Fire destroyed much of Altadena, a historic middle-class homeowning community. Together, the fires killed dozens of people and destroyed nearly 13,000 homes.

Soon afterward, one of us took an optimistic view of the future in these pages. Great cities have often recovered from catastrophe, we argued, because the advantages that made them desirable in the first place survive the destruction. This generally remains true of Los Angeles. Despite the fires, the city retains its good weather, natural beauty, and much of its human capital. If land, housing, and insurance markets were allowed to function, we reasoned, private investment could enable a safer and more dynamic city to rise from the ashes.

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Eighteen months later, it appears that this argument was too optimistic about how readily market forces would be permitted to operate in a city that has long made building difficult. Instead of letting private investment meet the demand for rebuilding, government regulations, permitting delays, insurance dysfunction, and other institutional barriers continue to stifle recovery. Los Angeles is now experiencing a second-order crisis—a disaster after the disaster—driven in large part by policies that have made it harder for residents to adapt, rebuild, and return.

In the months after the fires, many anticipated a construction boom. Mayor Karen Bass promised to streamline permit reviews, while Governor Gavin Newsom suspended some regulatory requirements and issued a series of executive orders intended to speed rebuilding.

But actual reconstruction has been slow. Only a fraction of the destroyed homes have been completed. Vast stretches of Pacific Palisades and Altadena remain vacant, and the initial optimism reflected in “Palisades Strong” signs has given way to a more fragmented recovery. Some determined homeowners have pushed ahead, while others are waiting, selling, or leaving.

A homeowner deciding whether to rebuild faces several kinds of uncertainty at once: Will the necessary permits get approved, and when? How much will the insurer pay? Will neighboring homes be rebuilt, or will the block remain half-empty? Will insurance remain available after the new house is completed? And what further risks will the area face in the years ahead?

Economic theory predicts that people will delay making large investments in rebuilding when uncertainty is high. Waiting may be prudent for any individual property owner, but the accumulation of those delays can slow the recovery on which each homeowner’s decision depends. A neighborhood becomes less attractive to rebuild in when few others are doing so. This coordination problem is likely to shape the recovery for years.

The burden is especially severe in Altadena. Affluent Palisades homeowners are more likely to have savings, legal assistance, and access to credit. But Altadena includes more middle-class and longtime homeowners whose wealth was concentrated in the properties they lost. These households have less capacity to absorb years of rent, insurance shortfalls, unexpected construction expenses, and prolonged disputes with insurers or public agencies.

Altadena was also a center of black homeownership in Southern California, built over generations when discriminatory practices restricted where black families could buy. If its homeowners cannot afford to return, the fire will have also destroyed an important source of intergenerational wealth and community stability.

Uncertainty over soil contamination has added another complication. The fires consumed older homes containing lead paint and asbestos, along with vehicles, appliances, batteries, and other materials capable of leaving hazardous residues behind. Tests by the Los Angeles Times and Los Angeles County found elevated levels of lead and other toxic metals on some properties, including parcels that had already been cleared.

The findings leave homeowners with another unresolved question about the safety and cost of rebuilding. Some health effects associated with toxic exposure may not become apparent for years, making it hard to determine how much risk remains or what level of cleanup is sufficient. Homeowners seeking greater certainty may have to pay for their own testing and, if contamination is found, more remediation.

Properties in Altadena and the Palisades therefore carry a new and hard-to-price risk. Property owners may discover environmental liabilities only after acquiring a lot or beginning construction. That uncertainty lowers what purchasers are willing to pay and functions as another hidden cost of rebuilding.

Click here to read the full article in the City Journal

California’s home insurer of last resort seeks 36% rate hike following January fires

The California FAIR Plan, the state’s home insurer of last resort, is seeking an average 35.8% rate hike, its largest in years, following billions of dollars of losses incurred in the January fire storms.

The Los Angeles-based insurance pool, operated and backed by the state’s licensed home insurers, filed this week for the dwelling policy rate hike, which must be reviewed and could be reduced by the state insurance commissioner.

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“By statute, FAIR Plan rates must be sufficient to pay anticipated claims and expenses,” said FAIR Plan spokesperson Hilary McLean in a statement. “The FAIR Plan is working closely with the California Department of Insurance to ensure its rates reflect the current risk portfolio, expenses and growth as the state’s insurer of last resort.”

The plan, which has added hundreds of thousands of policyholders in recent years as insurers have pulled back from the market amid rising wildfires, has estimated losses of $4 billion from the January blazes. Those losses forced it to assess its member carriers $1 billion in order to pay all claims.

The rate hike would hit individual homeowners unevenly, with many experiencing greater increases and others seeing decreases if they live in neighborhoods that are not prone to wildfires. The new rates would apply in April and homeowners can seek discounts of up to 15% if they take steps to reduce the fire risks on their property.

The rate hike, if approved, would easily top increases of 20.3% in 2019 and nearly 16% in 2021 and 2023. However, the 2023 rate hike of 15.7% was cut down by Insurance Commissioner Ricardo Lara from the 48.8% initially sought by the plan.

The request for the increase is bound to be controversial given accusations over how the plan has handled smoke damage claims stemming from the Jan. 7 blazes and other fires dating back to last decade.

Click here to read the full article in the LA Times

Bill requiring removal of unused power lines to avoid wildfire risks dies in Sacramento

A state bill that would have required Southern California Edison and other investor-owned utilities to take steps to avoid causing catastrophic wildfires died in Sacramento on Friday.

Sen. Sasha Renée Pérez’s (D-Pasadena) district includes Altadena, which was devastated by the Eaton fire in January.

She introduced SB 256 earlier this year to make power infrastructure more safe and less prone to starting wildfires, citing reporting in the Los Angeles Times about some investigators and experts’ concerns that a decommissioned power transmission line in Eaton Canyon may have been the fire’s ignition site.

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That reporting also revealed that Edison knew that some of the electrical towers under investigation were long overdue for critical upkeep and were classified as an “ignition risk” in company records.

Her legislation would have required Edison and other investor-owned utilities to make a plan to remove decommissioned power lines across the state.

It would have also boosted “California’s electrical infrastructure and wildfire resilience by improving wildfire mitigation planning, enhancing emergency response efforts, undergrounding power lines, and requiring closer collaboration between utilities, emergency services and local communities to prevent wildfires,” according to an email from Jerome Parra, a spokesperson for the senator.

Pérez called the bill, which she wrote, her top legislative priority this year, and said its failure was “disappointing” given the stakes of the issue.

“I’m very frustrated because, when are we going to have accountability? When are we actually going to start reducing fire risk and ensuring utilities are reducing fire risk?” Pérez said in an interview.

Click here to read the full article in the LA Times

Wildfire milestone: After clearing nearly 10,000 homes, Army Corps says it’s close to finish line

Less than eight months after the Eaton and Palisades wildfires destroyed 16,000 buildings in Los Angeles County, the U.S. Army Corps of Engineers on Tuesday announced it was preparing to clear wreckage from the final residential parcel that opted into the federal cleanup.

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At a news conference in Pacific Palisades, U.S. Rep. Brad Sherman (D–Sherman Oaks), L.A. County Supervisor Lindsey Horvath and L.A. City Councilmember Traci Park joined federal disaster agencies in commemorating the federal response to the wildfires as the fastest wildfire recovery in modern history. Federal contractors say they have cleared 2.5 million tons of fire debris from nearly 10,000 properties, finishing roughly four months earlier than the Army Corps’ January 2026 goal and well ahead of experts’ and lawmakers’ initial projections.

“What was expected to take more than two years was finished in just seven months,” Horvath said. “That speed is extraordinary, but this milestone is about more than speed. It’s about partnership and compassion and a shared commitment to walk the road of recovery with our community until the very end.”

The debris removal began in late January when the U.S. Environmental Protection Agency oversaw the collection and disposal of hazardous debris, such as potentially explosive lithium-ion batteries and compressed gas canisters. In February, the Army Corps began to supervise work crews tasked with gathering toxic ash, rubble and contaminated soil from destroyed properties.

Over the the last few months, Army Corps-led contractors have worked rapidly to clear thousands of properties. However, the work has in some cases been imperfect. As The Times reported this month, hundreds of homeowners filed complaints of sloppy and inconsistent work by federal contractors hired to remove debris.

On Tuesday evening, officials gathered outside the final residential property scheduled to be cleaned by federal work crews, the site of a three-bedroom home perched on a scenic hillside overlooking the Pacific Ocean.

Click here to read the full article in the LA Times

LA fires could drastically drive up insurance premiums — and test California’s new market rules

The deadly and destructive fires in Los Angeles — which some say could be the costliest in the state’s history — will further strain the insurance market and worsen the financial position of California’s insurer of last resort.

Data about Pacific Palisades, the devastated LA neighborhood whose residents include movie stars and directors, help illustrate the insurance problems plaguing the state. An estimated 1 in 5 homes in the upscale neighborhood were covered by the insurer, known as the FAIR Plan. 

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Property owners in California have increasingly been turning to the plan, a pool of insurers required by state law to sell fire policies to consumers who can’t find regular insurance elsewhere. That’s because, for the past few years, insurance companies have been canceling policies or refusing to write new ones in California, citing rising risk of wildfires. As a result, the FAIR Plan’s number of homeowner policies grew to more than 451,000 as of September 2024, an increase of 123% over the past three years.

Last year, State Farm decided not to renew tens of thousands of policies in the state, including about 1,600 in Pacific Palisades. As of September, there were 1,430 residential FAIR Plan policies in the enclave’s 90272 ZIP code, an 85% increase from the previous year, according to the plan’s latest data. 

Elsewhere in Los Angeles, some cities and neighborhoods with spiking FAIR Plan use have either been evacuated or are near the fires. They include the 90402 ZIP code in Santa Monica, where FAIR Plan policies have increased 128% year over year. 

Now, after at least five people have died and more than 2,000 structures have been destroyed in the LA area, and as those who have lost their homes begin to submit claims with their insurance companies, there’s a big question mark around the state’s plan to try to ensure insurance availability. A plan touted by Insurance Commissioner Ricardo Lara as a way to get insurance companies to write policies in the state again just became effective at the beginning of the year. 

The so-called sustainable insurance strategy includes having the state speed reviews of rate hike requests from insurance companies and allow insurers to use catastrophe models when setting their premiums. Insurers would also be able to adjust for the cost of their own financial backstop, known as reinsurance. The concessions mean insurers will raise premiums for the state’s property owners but in exchange must write or maintain a certain number of policies in high-risk areas.

“There’s no doubt that this massively complicates things,” said Stephen Collier, professor of city and regional planning at UC Berkeley whose research focuses on insurance, climate change and urban planning. “It couldn’t be at a worse possible time.”

Lara also told CalMatters today that “of course this is going to complicate an already complicated market.” 

But the commissioner said he has been in touch with insurance companies in the past couple of days: “The reforms are in place now, the (insurers’) commitments are in place now. As far as my conversations as recently as last night, those still stand and move forward.”

In addition, the FAIR Plan, the insurer for many of those affected by the current blazes, will likely have to pay claims for tens of billions of dollars in damages.

“This massively complicates things.”STEPHEN COLLIER, PROFESSOR OF CITY AND REGIONAL PLANNING AT UC BERKELEY

Collier said that massive potential liability could make insurers “think twice” about whether they want to keep writing policies in the state. “Having all this risk transferred to the FAIR Plan doesn’t get insurers off the hook if they’re still writing in the California market,” he said. That’s because insurers in the state are on the hook to pay into the plan when it can’t cover all its claims.

Click here to read the full article in CalMatters

Homes burning as 2,920-acre wildfire spreads in Pacific Palisades amid strong windstorm

A brush fire that quickly swelled to more than 2,920 acres amid a strong windstorm in Pacific Palisades by Tuesday evening has burned multiple homes and forced 30,000 residents to evacuate, as wind-driven embers spread throughout the hillside community.

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Several people were burned and at least one firefighter was reported injured.

More than 10,360 homes were threatened by the Palisades fire, officials said at an afternoon news conference. Broadcast and social media videos showed houses fully engulfed in flames. Air tankers and water-dropping helicopters made drops as firefighters from the across the region rushed to the scene.

Multiple burn victims were reported at Duke’s Malibu and Big Rock Beach Cafe around 9 p.m., Los Angeles Fire Department officials said. They reportedly had burns on their hands and faces, said LAFD spokesman Adam VanGerpen, and medical units were sent to evaluate and treat them.

Even the vegetation around the Los Angeles Fire Department’s Palisades station was burning at one point on Tuesday, though the building itself was not on fire, Margaret Stewart, an LAFD spokeswoman, said.

And late in the day, fire broke out in the brush at the iconic Getty Villa, a rambling compound full of rare historic artifacts near the Pacific Ocean. But the building and its collections did not burn, officials said.

• Also see: This map shows where the Palisades fire is burning in Pacific Palisades

Some 30 vehicles that were ditched along Sunset Boulevard and Palisades by people fleeing the massive fire would have to be moved by a county dozer to provide clear access for firefighters and others, authorities said. By evening, a freelance news photographer counted dozens more abandoned cars.

A state of emergency was declared for the city of Los Angeles, City Council president Marquis Harris Dawson said. The city had 250 firefighters battling the blaze, along with additional resources from several agencies from around the state.

“The worst part of this wind event is yet to come,” Harris Dawson added, referring to strong gusts expected overnight. Peak winds are expected from 10 p.m. Tuesday to 5 a.m. Wednesday, officials said.

“By no stretch of the imagination are we out of the woods,” said Gov. Gavin Newsom, who appeared with local officials at the afternoon news conference at Will Rogers State Beach. The Federal Emergency Management Agency approved a grant to help with firefighting resources, he announced.

Newsom was surprised to learn that despite the obvious danger, some residents did not heed evacuation orders.

Late Tuesday, fire officials announced that a 25-year-old firefighter sustained a serious head injury as a result of the Palisades Fire. She was treated at the scene and taken to a hospital for further evaluation and treatment.

The Palisades fire was initially reported around 10:30 a.m. in the area of ​​Piedra Morada and Monte Hermoso drives, Los Angeles Fire Department spokesperson David Ortiz said. The blaze later jumped Palisades Drive and was burning on both sides of the road.

Capt. Erik Scott, an LAFD spokesman, said the fire was burning in a westward direction near the Pacific Palisades Highlands community.

The fire was “rapidly spreading due to the significant winds that we have,” Scott said in a 12:30 p.m. update.

Multiple structures could be seen burning in the fire zone, and there were repeated reports of police and fire crews working to rescue people from burning buildings — but there were no immediate reports of any injuries. On at least two occasions, crews responded to homes where people were in residential swimming pools to escape the flames.

Evacuation orders were issued in a “polygon”-shaped area from Merrimac Road on the northeast, west to Topanga Canyon Boulevard and south to Pacific Coast Highway, according to the Los Angeles Fire Department. The orders essentially cover the bulk of Pacific Palisades.

Click here to read the full article in the OC Register