Gov. Gavin Newsom last month announced a “Marshall Plan” to rebuild the region after wildfires claimed 29 lives and could cost as much as $275 billion in economic damage. The name refers to Secretary of State George Marshall’s aid package that helped Western Europe rebuild after World War II. Modern politicians, of course, like to name their costly new projects after well-regarded past ones, but it’s crucial to zero in on the details.
“California is organizing a Marshall Plan to help Los Angeles rebuild faster and stronger—including billions in new and accelerated state funding so we can move faster to deliver for the thousands who’ve lost their homes and livelihoods in these firestorms,” the governor said. Newsom announced executive orders to suspend some rebuilding rules. Lawmakers also added fire issues to their emergency session regarding Trump-proofing the state.
We applaud the governor’s rule suspensions, are fine with the $2.5 billion in wildfire-related funding and have no problem with many proposals, but we agree with political consultant Mike Madrid. He told CalMatters: “Keeping a politician away from a TV camera is like trying to keep a gnat away from a porch light.” Lawmakers, he added, are proposing all sorts of ideas to “presumably show their constituents that they are doing something about it.”
As we’ve noted repeatedly, the L.A. wildfires exposed a confluence of bad policymaking that has been years in the making. These include excruciatingly slow brush-clearance efforts, insurance price controls that left many area homeowners uninsured or underinsured, a refusal to upgrade the state’s water infrastructure, and environmental regulations that make construction a slow and daunting process. Few of the latest ideas target those fundamental problems.
As far as the specific proposals, lawmakers have proposed some bills that put restrictions on private parties. They require lenders to suspend mortgage payments to victims for 180 days, ban rent hikes for a year and require that insurance escrow accounts for reconstruction earmark interest payments to homeowners rather than lenders. Some of the measures expand government involvement, such as a bill that would create a new task force to coordinate rebuilding efforts. These are problematic approaches.
Most of the legislative package, however, is reasonable. One bill would freeze most new building standards during rebuilding. Another would accelerate state permit approvals. Others would remove California Coastal Commission approvals to construct ADUs and remove tenancy rights for those who stay in short-term rentals beyond 30 days. Another one would prohibit evictions for tenants who house a wildfire victim or their pets.
New legislation sponsored by Los Angeles law-enforcement officials would step up penalties for looting and other wildfire-related crimes. The state is providing various tax breaks for victims and ones that would provide additional incentives for homeowners who fire-proof their properties. Lawmakers are pushing legislation to bolster the FAIR Plan (Fair Access to Insurance Requirements)—the state’s teetering insurer of last resort.
Although many of these responses are fine, we have a hard time understanding why officials neglected their responsibilities before the wildfires. They have long known about the regulation-driven contraction of the insurance market. Everyone in the Capitol knows the California Environmental Quality Act (CEQA) hinders construction. Lawmakers need to spend less time formulating post-disaster Marshall Plans and more time fixing things before disaster strikes.