Bill proposes $1-billion wildfire prevention plan
Bipartisan measure comes hours before a legal deadline and faces an uncertain fate in the Legislature.
SACRAMENTO — A bipartisan group of California lawmakers proposed Tuesday to spend $1 billion to clear fire-prone trees and brush from across the state over the next five years while providing new relief for utility companies that have said wildfire costs could lead them to bankruptcy.
But critics maintained provisions in the bill offer little protection to utility customers from footing the bill, even when the companies are found at fault for some amount of a fire’s origins.
“Make no mistake about it, it’s not perfect,” said state Sen. Bill Dodd (D-Napa), a co-chair of the committee. “Little that we do here ever is.”
The action by a special conference committee of the state Senate and Assembly — during a hearing where lawmakers seemed perplexed by the procedural rules and only one day after they bickered over the proposed policy — came only hours before a legal deadline for the proposal’s final language to be available for public review.
The two houses of the Legislature must take up the plan before they adjourn for the year Friday night. The ultimate fate of the proposal is uncertain. Utility company representatives insisted the proposal doesn’t do enough to address their fire-related costs, while some large industries argued their own costs as customers will rise.
While the proposed law lays out dozens of new wildfire prevention policies — including a streamlining of government approval to remove trees in heavy growth forests and exceptions to existing rules on the sizes of trees that can be removed — the late negotiations in Sacramento were focused squarely on the money.
Key lawmakers wanted to ensure that the state would spend enough money on new vegetation management programs, which include grants and other financial incentives for owners of smaller parcels of land, to do the necessary work. The final proposal would allocate $1 billion over a fiveyear period from the money collected by the sale of
greenhouse gas emission credits through California’s cap-and-trade climate program.
The most contentious financial discussions, though, centered around the distress call sounded by independently owned electric utilities of possible bankruptcy over wildfire liability costs. Pacific Gas & Electric Co. led that charge, warning analysts last month that it faces as much as $2.5 billion in costs related to deadly fires that burned through Northern California in 2017.
The proposal would allow PG&E to impose a surcharge on its customers that would be used to then sell long-term bonds to cover those costs. It would require an independent assessment of how much money the company could afford to spend, described by lawmakers as a “stress test,” before any additional costs are covered in a borrowing effort that’s underwritten by a fee on ratepayers.
Mark Toney, the executive director of The Utility Reform Network, or TURN, criticized the rules for 2017 fire costs as driven mainly by the demands of PG&E.
“It sets a cap on how much PG&E pays for fire damage and no cap for how much ratepayers pay,” Toney told lawmakers.
For future fires, utility companies would have their share of fault determined by the California Public Utilities Commission. The final legislative language builds on a concept promoted last month by Gov. Jerry Brown that companies should be responsible for only the costs of a fire that are proportional with their fault. State regulators would be tasked with making those determinations.
Advocates for California consumers and fire victims seemed divided over the final proposal, which was not made public until just minutes before the meeting began.
“California victims will be better, California will be safer as a state,” said Patrick McCallum, a lobbyist whose Santa Rosa home was destroyed in 2017.
For weeks, lawmakers have been warned that any proposal seen as too deferential to the powerful utility companies would be tantamount to a “bailout,” an unfair shouldering of costs by residential and industrial customers. Defenders of the proposal said that electricity customers were never going to be able to escape all the costs associated when a utility’s equipment plays a role in the origins of a fire. This plan, they insisted Tuesday, will place limits on those costs while ensuring the financial stability of the companies.
“It is what it is; we’ve got to move on,” Dodd said toward the end of the brief hearing.