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California Firefighters Progress on Wildfires as Lawmakers Struggle with Liability Response

After nearly a month of fighting intense wildfires across the state, California firefighters were making progress Friday, while in the state capital lawmakers were struggling to pass a legislative solution around preparedness and liability before adjourning at the end of the month.

The legislative conference committee is considering state Senate Bill (SB) 901, but has offered little guidance that a package will emerge before the session ends.

Analysts at Height Capital Markets on Friday suggested lawmakers could add a securitization portion to SB 901 in lieu of a more meaningful solution to the liability conundrum for utilities. Citing timing and political limitations against a more complete solution, analyst Clayton Allen said the conference committee chairs "could push for limited securitization as a potential last-ditch effort to produce some liability relief."

Meanwhile, Assemblymember Chad Mayes, who represents the high desert region in Southern California, proposed a state wildfire insurance fund, which could be supported by the investor-owned and public sector utilities. Mayes reportedly said the plan would assist the utilities that act prudently while reducing the potential financial hit from future fires on utility ratepayers.

The proposal calls for a state-governed entity to oversee utility funding, with the funding amounts worked out in legislative negotiations. Various details on the proposal include creating a nine-member board appointed by the governor, with legislators overseeing the fund.

Separately, the Coalition of California Utility Employees (CCUE) issued a proposal to cap the legal fees by attorneys representing wildfire victims. "The proposal is based on three different state statutes that limit attorney fees in order to deliver maximum benefits to injured workers and victims," a CCUE spokesperson said.

Utility employees, including some who have been impacted by the wildfires, are proposing legislation to ensure adequate compensation for attorneys while protecting against unreasonable fees, as is done in the workers compensation field, according to CCUE.

The largest wildfire, the Mendocino Complex, on Friday was 75% contained. It had scorched more than 329,000 acres. The Carr fire, covering more than 218,000 acres, also was 75% contained, while the Holy fire across 23,000 acres of Southern California was 85% contained.

The National Oceanic and Atmospheric Administration on Thursday forecast hotter- and drier-than-normal weather to continue in the state through the wildfire season, which runs into November.

The forecast comes as monitoring stations in Northern California show that grasses, brush and other fire “fuels” are reaching record dry levels, following a July that was considered the state’s hottest month on record. There’s also a chance that strong Diablo winds, similar to those that fanned 2017 fires in Northern California, could return in coming months.

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