Gov. Newsom Signs ‘Unconstitutional’ Wildfire Legislation, Passing Costs to Ratepayers

The lawsuit says that the utility companies basically bought off Gov. Newsom and most of the legislators who voted for the law.

The wildfire legislation that Governor Gavin Newsom just signed into law is being challenged in court for allegedly violating both the United States Constitution and the California Constitution.

The law established a $21 billion fund to cover damages from wildfires caused by utility companies faulty equipment.

$10.5 billion for the fund comes from charges on customer’s utility bill.   The other $10.5 billion is coming from the utility companies.

But the legislation makes it harder for customers and outside groups to hold utility companies for fires by shifting the burden of proof to them.   Under the new standard enacted under law the burden of proof is now on claimants to show that the utility company was negligent or behaved imprudently.

Previously, it was incumbent upon utilities to prove that they were not at fault for fires allegedly caused  by their equipment. The lawsuit says the new standard amounts to a denial of due process under the United States Constitution of utility companies.

The plaintiffs in the lawsuit filed in the United States District Court for the Northern District of California are two Pacific Gas & Electric customers, Alex Cannara and Gene Neilson.

It charges that the law violates both the United States and California constitution and is asking that the Court issue an injunction to prevent the law, which was passed as an urgency statute, from taking effect.

It says the legislation was improperly deemed “an urgency statute” in violation of the California Constitution. It was approved by both houses of the California Legislature in just four days and then signed into law by Governor Gavin Newsom on July 12.

The lawsuit says that the utility companies basically bought off Gov. Newsom and most of the legislators who voted for the law, AB 1054.

“PG&E made massive campaign contributions to nearly every member of the legislature to secure passage of AB 1054” and that the utility “donated $248,000 to help elect Gov. Gavin Newsom and sent more than $550,000 to both the state Republican and Democratic parties.”

The complaint also charges denial of due process because customers are being sacked with an additional charges on their bills to create the wildfire fund. This, the lawsuit claims,  gives the utility companies “limitless utility customer subsidies without any incentives to act prudently” because taxpayers end up footing the bill even if the utility companies are responsible for the fires.

It also says the charges amount to an unconstitutional “takings”  of property under the United States Constitution and California Constitution.

The complaint is against the California Public Utilities Commission and its five controlling commissioners, as well as a slew of other state officials and departments.

Asked for comment by the San Diego Union Tribune, Governor Gavin Newsom’s office cited a statement he made right after the legislation was passed:

“We made a determination that this [AB 1054] was the best path,” Newsom said after the Legislature approve the bill. He said it would  “move our state toward a safer, affordable and reliable energy future, provide certainty for wildfire victims and continue California’s progress toward meeting our clean energy goals.”

Assembly Member Chris Holden (D-Pasadena) , the bill’s author, declined comment.