With no public bill text available, California lawmakers are weighing a proposed wildfire-liability package that Newsom says could protect survivors while helping utilities avoid financial strain.
Gov. Gavin Newsom is pursuing a late-session California wildfire deal whose final terms were not publicly available as of the San Francisco Chronicle’s reporting. The proposals under discussion could affect what insurers, local governments and wildfire survivors can recover when utility equipment is found to have caused a fire.
That uncertainty has intensified a familiar dispute: whether California can reduce the financial pressure on utilities without weakening accountability for the harm caused by catastrophic wildfires.
Key terms remain out of public view
According to the Chronicle, Newsom is trying to broker an agreement during the final days of California’s last legislative session of the year. Lawmakers face an Aug. 31 deadline, and bills generally must be publicly available for three days before legislators can send them to the governor.
As of the Chronicle’s reporting, no bill text had been introduced. The broad direction of the administration’s approach was known through briefings and memos, but the specific limits, protections and financial obligations had not been set out in legislation available to the public.
State Sen. Sasha Renée Pérez, a Pasadena Democrat, told the Chronicle that the last-minute effort was creating “huge friction” among lawmakers because of the consequences of the proposals.
Newsom has opposed waiting for a fall special session, saying lawmakers have had years to address the problem. His position is that action should not be left to the next governor.
The proposals could limit several kinds of recovery
The package described by the Chronicle includes restricting insurers’ ability to seek money from utilities after paying policyholder claims, a process known as subrogation.
The administration has also floated limits on some non-economic damages for wildfire survivors and limits on local governments’ ability to recover the full replacement cost of damaged public infrastructure. Those provisions could alter what victims and communities can seek after a fire.
Newsom’s office has described measures it says would balance those changes. Its fact sheet, shared with the Chronicle, includes bill credits for utility customers, annual-bonus forfeitures for utility chief executives when their company is found to have caused a catastrophic wildfire, and stronger shareholder penalties for safety violations.
The governor’s office has argued that survivors should be paid before insurers, attorneys or utility shareholders. It pointed to PG&E’s $11 billion settlement with insurance companies after the Camp Fire, which the office said came before many individual survivors received payment on their claims.
An unusual opposition coalition has formed
The Chronicle reported that consumer advocates, wildfire survivors and the insurance industry have formed an unusual coalition opposing the proposal. Their concern is that reduced utility liability could leave insurers with larger losses and contribute to higher premiums for customers.
Several survivor organizations have challenged the utility-backed Wildfire Victims First campaign’s framing of the plan. They argue that limits on recoveries or insurer claims could reduce the financial responsibility of companies whose equipment caused fires.
Newsom’s administration, meanwhile, has said avoiding a utility bankruptcy could help companies maintain access to capital for wildfire-safety investments. The dispute is over whether that financial backstop can be built while preserving meaningful compensation and accountability.
California is revisiting a system created after PG&E’s crisis
Wildfire liability has been a defining issue of Newsom’s governorship. The Camp Fire broke out near Paradise shortly after his election in 2018 and became the deadliest wildfire in California history. PG&E announced plans to seek bankruptcy protection soon after Newsom took office, as scrutiny grew over whether its equipment ignited the fire.
Newsom publicly criticized the utility while confronting the consequences of a potential collapse at a company that provides electricity and gas service to an estimated 16 million Californians.
In 2019, Newsom and lawmakers created the $21 billion California Wildfire Fund, a reserve utilities could use to pay claims when their equipment was found responsible for a wildfire. Critics characterized the fund as a bailout because it reduced utilities’ financial exposure.
According to the Chronicle, California’s major utilities are not now in bankruptcy, but the Wildfire Fund is dwindling after recent disasters, including the major 2025 Los Angeles wildfires. Insurance availability in high-risk areas is also a growing concern for homeowners.
The larger question is how California pays for wildfire risk
The Chronicle reported that an April study commissioned by Newsom and lawmakers examined connected pressures: climate-driven fire risk, overgrown vegetation, insurer withdrawals from high-risk areas and rising utility liability costs.
Its recommendations included additional fire-mitigation work, such as hardening homes and clearing brush around communities, along with faster compensation for families whose homes burn.
The late-session debate now turns on details lawmakers had not yet been able to review in public bill language: which claims would be restricted, how customer credits would work, what would trigger executive-bonus forfeitures and whether shareholder penalties would materially affect utility conduct.
Newsom’s effort could become one of the last major policy fights of his governorship. The outcome will depend on whether a deal can address utility and insurance pressures while retaining a path to recovery for people and communities harmed by wildfire.
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