PG&E to Pay $1 Billion to Local Governments for California Wildfires

Flames consume a Kentucky Fried Chicken as the Camp Fire tears through Paradise, Calif., on Thursday, Nov. 8, 2018. Tens of thousands of people fled the fast-moving wildfire in Northern California, some clutching babies and pets as they abandoned vehicles and struck out on foot ahead of the flames that forced the evacuation of an entire town and destroyed hundreds of structures. (AP Photo/Noah Berger)

(CN) – Pacific Gas and Electric, the Northern California utility whose equipment sparked some of the deadliest and most destructive wildfires in Golden State history, agreed Tuesday to pay about $1 billion to local governments affected by the blaze.

Attorneys from 14 cities and counties touted the settlement as a means to cover taxpayer losses associated with the wildfires.

“This is an important first step toward an orderly, fair and expeditious resolution of wildfire claims and a demonstration of our willingness to work collaboratively with stakeholders to achieve mutually acceptable resolutions,” said PG&E spokesman James Noonan in a statement provided Tuesday.

Under the agreement, Butte County will receive $252 million – nearly a quarter of the settlement – while the town of Paradise, which was essentially leveled as a result of last year’s Camp Fire, will receive $270 million.

“This is an important step toward stabilizing the county so we can continue to provide key services to residents, especially as our communities recover from the Camp Fire,” said Butte County Counsel Bruce Alpert.

Paradise – located in Butte County – lost about 90 percent of its property tax base and nearly all of its sales tax revenue in the fire, which killed 85 people and destroyed about 18,000 buildings.

A coalition of eight northern counties including Nevada, Mendocino and Yuba counties, will receive about $415 million as a result of damage from recent fires.

“This settlement will help Nevada County reimburse the public resources that were lost or damaged during the 2017 Lobo and McCourtney Fires, and support ongoing community services to keep us ready for wildfire,” said the Nevada County Board of Supervisors chair Richard Anderson.

Other terms of the settlement have not been disclosed.

PG&E said the settlements are a part of its Chapter 11 bankruptcy proceedings and pertain to the 2015 Butte Fire, the 2017 Wine Country fires and the 2018 Camp Fire.

“Our goal throughout the Chapter 11 process is to work collaboratively to fairly balance the interests of our many stakeholders, as well as the customers and communities we serve,” Noonan said.

The settlement was announced by Dallas, Texas-based Baron & Budd, which represented the public entities in the matter.

“This money will help local government and taxpayers rebuild their communities after several years of devastating wildfires,” said Baron & Budd shareholder Scott Summy, co-lead counsel in the case. “The cities and counties will be in a better position to help their citizens rebuild and move forward.”

The settlement must be approved by the judge overseeing PG&E’s bankruptcy case. PG&E filed for Chapter 11 bankruptcy earlier this year as liability costs related to years of devastating wildfires skyrocketed into the billions for the investor-owned utility.

PG&E’s financial woes have California lawmakers scrambling to come up with solutions, including revisiting how liability is assessed in wildfire cases and the creation of an independent public fund to pay wildfire victims in a more expeditious and equitable manner.


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