California Utility PG&E To Pay $1 Billion To Local Governments For Wildfire Damage

Jun 18, 2019
Originally published on June 19, 2019 10:33 am

California utility giant Pacific Gas and Electric Co. (PG&E) has agreed to pay $1 billion to 14 local governments throughout the state for the wildfire damage caused by its equipment and practices.

Attorneys for a group of local public entities — counties and cities — announced the proposed settlement Tuesday to help cover taxpayer losses from the 2015 Butte Fire, the 2017 North Bay Fires and the 2018 Camp Fire.

The town of Paradise, which was virtually destroyed by the 2018 Camp Fire, will receive $270 million. Another $252 million is designated for Butte County and $47.5 million for Paradise Recreation and Parks District.

Another $415 million will be divided by other jurisdictions and agencies hit by the wildfires in 2017, including Sonoma County, the city of Santa Rosa, Napa County and the city of Napa.

Yuba County and the Calaveras County Water District will receive $12.5 million and $3 million respectively for the 2015 Butte Fire.

"The town of Paradise will rebuild, and this is an important step towards our recovery," said Paradise Mayor Jody Jones as quoted by the Times-Standard. "On behalf of the town, we hope to receive the money as soon as possible so we can put it towards rebuilding our infrastructure and providing those necessary services for community resiliency."

The proposed settlement does not cover claims filed by individuals or businesses who were victims of the fires and the action faces another hurdle: it is subject to approval by a bankruptcy court.

PG&E filed for bankruptcy protection in January. State fire investigators concluded in May that PG&E's transmission lines were to blame for the 2018 Camp Fire, the deadliest and most destructive in California history. The fire killed 85 people and burned more than 150,000 acres.

The settlement is "an important first step toward an orderly, fair and expeditious resolution of wildfire claims," PG&E spokesman Ari Vanrenen said in a statement. "We remain focused on supporting our customers and communities impacted by wildfires and helping them recover and rebuild."

: 6/18/19

In the audio version of this story, we incorrectly say the Camp Fire took place last summer. In fact, it was November 2018.

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ARI SHAPIRO, HOST:

This afternoon in California, Pacific Gas & Electric Company, known as PG&E, and lawyers for more than a dozen different communities announced a proposed $1 billion legal settlement. It's payment for damages from a string of wildfires that the utilities equipment caused over the last four years.

Here to discuss what this agreement means for the bankrupt company and the thousands of people who still have legal claims against PG&E is reporter Dan Brekke of member station KQED in San Francisco. Let's begin with the town of Paradise which was nearly destroyed by the Camp Fire last summer. What does the $1 billion settlement mean for that community?

DAN BREKKE, BYLINE: What the settlement could mean is that the town government is going to get a big shot in the arm in rebuilding the community. But there are several hurdles to get across first. This settlement would give the town of Paradise $270 million, but it's part of the bankruptcy proceeding that PG&E is involved in right now. And so it'll be some time before we know exactly when this money will be there for Paradise and the other communities that are involved in the settlement.

SHAPIRO: And there are more than a dozen other communities involved, so what does this mean for them? Like, what else is covered by this?

BREKKE: Well, there have been many communities in Northern California that have been affected by wildfires that the utilities equipment has been involved in ever since 2015. So lots of them are dealing with public infrastructure damage and tax losses and things like that. So when they get this money - the billion dollars that's going to be distributed among these 14 communities - then they'll be able to start dealing with some of those infrastructure problems and other deficits that they're facing.

SHAPIRO: You mentioned this is part of the bankruptcy settlement, and there are thousands of other people, insurance companies and businesses that have filed lawsuits against PG&E. What does this billion-dollar settlement mean for those claims given that there is a limited pool of money to distribute here?

BREKKE: Well, that's a really good point. And what the plaintiffs' attorneys are saying is that this is actually good news because it gives them some idea of what one of the other important plaintiffs in the case - these public entities, these communities - are willing to settle for. And because there's a limited amount of money to go around, they now know there's a little bit more for them potentially, and that's something that they'll take into consideration in their negotiations as part of the bankruptcy proceedings.

SHAPIRO: I'm sure people in these communities are wondering when they could see real money. Is this likely to be tied up in the legal system for a while, or could the payouts actually be coming soon?

BREKKE: The town lawyer for Paradise says that they don't really expect to see money any time sooner than a year or a year and a half after the bankruptcy reorganization of the company is settled.

SHAPIRO: And then who will actually make the decision of, within a given town, who sees the payout, whether it's businesses, companies, individuals?

BREKKE: You know that will be a community-by-community decision. But for instance, in Butte County, which is one of the counties stricken by the Camp Fire last fall, it has several extensive unincorporated communities that were very badly damaged by this. And so there's a lot of just public need in terms of rebuilding these places, putting in new water systems, new streets, new lights and that kind of thing. So I think that kind of need for the public entities themselves, for the communities is going to probably take precedence.

SHAPIRO: That's KQED reporter Dan Brekke. Thank you for joining us.

BREKKE: You're welcome.

[POST-BROADCAST CORRECTION: In the audio version of this story, we incorrectly say the Camp Fire took place last summer. In fact, it was November 2018.] Transcript provided by NPR, Copyright NPR.