{"id":749,"date":"2026-09-01T16:41:48","date_gmt":"2026-09-01T16:41:48","guid":{"rendered":"https:\/\/frontierhousingreport.com\/?p=749"},"modified":"2026-09-01T16:41:48","modified_gmt":"2026-09-01T16:41:48","slug":"california-wildfire-package-preserves-survivors-legal-rights","status":"publish","type":"post","link":"https:\/\/frontierhousingreport.com\/?p=749","title":{"rendered":"California Wildfire Package Preserves Survivors\u2019 Legal Rights"},"content":{"rendered":"
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Lawmakers in Sacramento have delivered the final blow to an eleventh-hour push by California Gov. Gavin Newsom (D) that aimed to limit claims fire survivors can bring against utilities for causing wildfires, block insurance companies from seeking restitution from those utilities, and cap attorneys\u2019 fees. Over the weekend, the legislature released the text of a bill that would render virtually all those terms null and void.<\/p>\n

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The sharp rebuke to Newsom, which followed sustained closed-door negotiations with legislative leaders, resulted in a face-saving bill known as SB 492. A vote on the bill will come as soon as today, and it is expected to pass.<\/p>\n

More from James Baratta<\/strong><\/em><\/p>\n

Despite all the money that utility-funded front groups and utility-aligned environmental nonprofits spent on ads calling for an end-of-session wildfire package last month, a coalition of real fire survivors, consumer advocates, local governments, trial lawyers, and insurers convinced legislators to reject the governor\u2019s bailout. The coalition, led by Every Fire Survivor\u2019s Network (EFSN) and Consumer Watchdog, called Newsom\u2019s bluff after he argued that the state\u2019s big three for-profit utilities could be at risk of going bankrupt as a result of wildfire-related litigation and liability. EFSN and Consumer Watchdog commended the legislature, namely, state<\/p>\n

Senate leader Monique Lim\u00f3n (D), for standing up against the presidential hopeful\u2019s lame-duck power grab.<\/p>\n

Newsom, in remarks at the Capitol on Monday, blamed \u201cBig Insurance\u201d and hedge funds for the defeat, virtually ignoring the role that victims played other than to say that trial attorneys \u201cuse\u201d them. The inversion of reality, where powerful interests cowed the governor, did not escape the notice of those who lost their homes in last year\u2019s catastrophic fires.<\/p>\n

\u201cHe\u2019s got his eyes on bigger and brighter things,\u201d Joy Chen, executive director at EFSN, told the Prospect<\/em>. \u201cBut for those of us who are left behind, these are hugely consequential issues that will determine \u2026 whether future fire survivors will ever be able to recover from catastrophic fires.\u201d<\/p>\n

EFSN put direct pressure on Newsom last week when its members staged a surprise protest in front of the Governor\u2019s Mansion in Sacramento, where he had been hosting a reception for state lawmakers. (Newsom and his family split their time between a $9.1 million estate in the prestigious neighborhood of Kent Woodlands in Marin County, and a 12,000-square-foot mansion in Sacramento\u2019s Fair Oaks village, which he recently listed for $7.5 million.)<\/p>\n

\u201cWe\u2019re just a survivor community just trying to get people home,\u201d said Chen, who told the Prospect<\/em> that while EFSN is not an advocacy group, it has \u201cbeen forced to get into fighting\u201d for fire survivors because of the governor\u2019s efforts to bail out investor-owned utilities in California.<\/p>\n

Elements of Newsom\u2019s initial policy proposal, such as barring private equity and hedge funds from profiteering off of claims brought by survivors, made it into SB 492. Although Newsom described the bill as a \u201ccompromise,\u201d he emphasized the need for \u201cfull structural reform,\u201d also urging the legislature to \u201cto build on this progress next year and finish the work we started\u201d in a statement his office released on Saturday.<\/p>\n

SB 492 would establish a Fast Pay program designed to ensure survivors receive compensation more quickly, though Eaton Fire survivors are not being forced into it. The bill also adds teeth to a provision in the governor\u2019s original plan to hold utilities accountable for sparking wildfires by eliminating bonus compensation for both CEOs and senior executives in the same year as a utility-caused wildfire that destroys at least 500 structures. The previous version of that provision would have only applied to CEOs, with the threshold instead being a utility-caused wildfire that results in at least one fatality. Last but not least, SB 492 does not deny recovery to fire survivors whose homes are damaged by smoke and sit outside \u201can artificial fire perimeter line,\u201d Chen said.<\/p>\n

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But some fire survivors are not ready for a victory lap. Beautiful Altadena, a survivor-led media and community network, was less sanguine about the bill. \u201cStopping Sacramento from taking something away from survivors is not the same thing as Sacramento putting survivors first,\u201d Shawna Dawson Beer, founder of Beautiful Altadena, wrote in a recent Substack article.<\/p>\n

\u201cPreserving our existing legal rights was the floor,\u201d she continued. \u201cIt should never have been the finish line.\u201d<\/p>\n

Dawson Beer, an Eaton Fire survivor who has been struggling to rebuild her home, observed that SB 492 creates a financial backstop for the California Wildfire Fund in the event it becomes insolvent. This mechanism would allow the California Earthquake Authority, which administers the fund, to issue bonds to compensate fire survivors. Those bonds would be repaid over time by customers of the utility that caused a wildfire. While the legislation indicates that utility contributions should be used to service that debt before ratepayer contributions, SB 492 \u201cexpressly contemplates debt backed by ratepayer contributions,\u201d according to Dawson Beer.<\/p>\n

Compared with an emergency financing solution, where the market prices in the risk of a particular wildfire, driving up the cost of debt and equity, the mechanism outlined in SB 492 may provide more predictable, flexible, and potentially cheaper financing. But the effective date of the legislation is January 1, 2025\u2014seven days before Southern California Edison (SCE) sparked the Eaton Fire. In other words, if Eaton Fire\u2013related claims have been settled or finally adjudicated, and the Wildfire Fund is exhausted, SCE could seek financing for outstanding costs through non-bypassable charges to electric customers.<\/p>\n

\u201cNot only does it allow them to continue to pass along those costs to the ratepayer that they\u2019re paying, but this now allows them to do that for the Eaton Fire,\u201d Beer said in an interview. \u201cIf that\u2019s not corporate welfare I don\u2019t know what is.\u201d<\/p>\n

As the Prospect<\/em> reported, SCE is already planning to recover uninsured losses from the Eaton Fire through higher rates; the utility exhausted its self-insurance coverage for the Eaton Fire in February.<\/p>\n

Lawmakers in Sacramento have their work cut out for them when they return for the next legislative session in January 2027. Still, EFSN and Consumer Watchdog are hopeful that legislators will take the opportunity to for many Californians: What will it take to stop the state\u2019s big three for-profit utilities from causing another catastrophic wildfire?<\/p>\n

\u201cOur legislators showed Californians what representative democracy can look like when elected leaders listen to the people they serve,\u201d said Chen. \u201cThis is an enormous victory for every Californian who could become the victim of the next utility-caused fire.\u201d<\/p>\n

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A coalition of fire survivors, consumer advocates, local governments, trial lawyers, and insurers convinced legislators to reject Gov. 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