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California Senate Passes Controversial Bill to Deal With Utility-Caused Wildfires

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A Cal Fire firefighter steps over a downed power line as he surveys abandoned burned cars on the side of the road after the Camp Fire devastated the town of Paradise on Nov. 10, 2018.  (JOSH EDELSON/AFP/Getty Images)

The California Senate has passed a controversial measure to overhaul how the state deals with utility-caused wildfires by a 31-7 vote.

The Legislature is hurrying to approve AB 1054 before lawmakers leave for their summer recess in an effort to avoid a further downgrade of the utilities' bond ratings.

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The measure includes a $21 billion fund that ratepayers and utility shareholders would pay into. The money could then be used to pay for damages related to wildfires caused by power company equipment. Companies would only have to reimburse the fund if they’re found to have acted unreasonably to start a fire. The amount of those reimbursements would be capped.

Sen. Jerry Hill ( D-San Mateo) said the bill strikes a good balance between holding utilities accountable, but not putting them at risk if they acted in good faith.

“I think, because we all benefit from the utilities, benefit from those wires that are traveling through our state, then we should collectively shoulder those costs," Hill said.

Supporters maintain the fund will help get fire victims money faster and provide financial stability to utilities.

Alex Jackson with the Natural Resources Defense Council said the bill doesn’t go far enough in protecting customers. But he said the status quo is not acceptable.

“We’re also concerned that, in the absence of the measures contained in this bill today, we will continue to put tremendous pressure on ratepayers to pay for these costs," he said. "I think we need stability. We think this measure brings a modicum of that.”


Several fire victims spoke in support of the measure. But Tubbs Fire survivor William Abrams wasn’t one of them. He said the measure is filled with loopholes that utilities will take advantage of.

“It breaks my heart," Abrams said. "There are many people who are affected by the fires that need the money. And I understand and sympathize with the folks who are on that side and I want to be there. But I cannot, in good conscience, support the bill on the backs of future wildfire survivors. And that’s what this does.”

California's three biggest utilities have called for major changes in state laws and regulations to help them better manage their wildfire liabilities and allow them to regain a solid financial footing.

The measure also ties executive compensation to fire safety, and requires the state's largest power companies to invest $5 billion in safety improvements.

The bill, which is supported by Gov. Gavin Newsom, requires a two-thirds vote of the Legislature to pass. It moves next to the Assembly.

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