Larry Klein
Mayor
Richard Mehlinger
Vice Mayor
Alysa Cisneros
Councilmember
Murali Srinivasan
Councilmember
Linda Sell
Councilmember
Charlsie Chang
Councilmember
Eileen Le
Councilmember
August 25, 2026
T
he Honorable Gavin Newsom
Governor, State of California
1021 O Street, Suite 9000
Sacramento, CA 95814
R
E: Administration's Wildfire Compensation and Utility Accountability Proposal - COMMENTS
D
ear Governor Newsom:
O
n behalf of the City of Sunnyvale, we recognize the need to maintain a viable Wildfire Fund, ensure timely and adequate compensation for wildfire survivors, strengthen utility accountability, and reduce the risk of catastrophic wildfires. As discussions regarding the proposal continue, the City believes these objectives can and should be achieved without diminishing the rights of wildfire survivors or shifting the financial consequences of utility-caused wildfires onto local governments and their taxpayers.
E
lements We Support
The City supports a comprehensive approach that strengthens wildfire prevention and utility accountability while protecting survivors. Specifically, we support a final framework that includes:
• A
statewide community -resilience strategy that better coordinates existing programs and directs mitigation funding to the places where it can most effectively reduce risk.
• A wildfire data that combines state, local, utility, and insurance information to support more complete risk mapping and regional decision-making. • A permanent funding source for the California Safe Homes Act and other practical home-hardening investments, including roof replacement. • Stronger utility accountability, including greater transparency for wildfire mitigation plans, meaningful penalties for safety violations, restrictions on executive compensation following a utility -caused fire, and escalating enforcement for repeated violations.
Attachment 3
The Honorable Gavin Newsom, Governor
August 25, 2026
• Faster and better -coordinated state approvals for mitigation projects while preserving appropriate local permitting authority
These reforms would advance the shared objectives of protecting survivors, strengthening utility accountability, and reducing wildfire risk. However, these protections should be accompanied by equally strong safeguards for the local governments and public agencies that bear substantial costs when responding to and recovering from utility-caused disasters.
These concerns are also consistent with the City’s existing Long- Term Advocacy Positions on Fiscal Management, including B(3), which directs the City to “oppose any legislation that reduces or erodes local revenues or local control,” and B(5), which calls for ensuring that “local governments’ revenue sources are protected and predictable.” The proposed limitations on public -agency cost recovery are inconsistent with these longstanding City positions because they would shift costs associated with utility-caused wildfires to local governments and their taxpayers and could reduce the resources available to provide essential public services.
Accordingly, the City respectfully requests that any final wildfire compensation framework include the following three reforms:
1. Preserve recovery of documented public-agency losses.
Local governments should retain the ability to recover reasonable and documented emergency response and recovery expenses, lost property- tax revenue, and other direct economic losses caused by a utility wildfire. State backfills are discretionary and may not cover the full duration or scope of a community's losses. FEMA reimbursement is similarly limited by eligibility rules, local cost shares, long delays, and uncertain federal appropriations. FEMA's prohibition on duplicative benefits prevents double recovery; it does not justify eliminating recovery for otherwise uncompensated losses.
2. Use actual replacement cost for damaged public infrastructure.
Compensation for a destroyed road, water system, fire station, communications facility, or other public asset should reflect the reasonable cost of restoring that infrastructure to current safety and construction standards. A diminished- value or depreciated- value measure may bear little relationship to what a public agency must actually spend to Attachment 3
The Honorable Gavin Newsom, Governor
August 25, 2026
restore essential services. The proposal should preserve full recovery of reasonable replacement and restoration costs, net of any non-duplicative state or federal assistance.
3. Preserve recovery of mutual-aid costs.
California's mutual-aid system depends on agencies sending firefighters, equipment, and personnel across jurisdictional boundaries without hesitation. When those resources respond to a utility-caused wildfire, the responsible utility should remain accountable for the reasonable costs of that response. Eliminating this recovery would transfer costs to assisting agencies and their taxpayers and could weaken the fiscal foundation of the statewide mutual-aid system. Mutual-aid costs should remain recoverable when they are documented, reasonable, and not reimbursed from another source.
We also respectfully urge the Administration to reject any characterization that public - agency recoveries compete with compensation for wildfire survivors. Protecting survivors and ensuring that public agencies are made whole are complementary objectives, not competing ones. Public-agency recoveries fund the emergency response, infrastructure, and essential services upon which survivors and affected communities depend.
If public-agency losses are excluded or artificially limited, residents may ultimately bear the consequences twice: first through the direct harm caused by the wildfire and again through reduced local services, deferred infrastructure restoration, or incre ased local taxes and fees. Similarly, restrictions on insurer subrogation could shift costs away from responsible utilities and ultimately place additional pressure on California's already strained insurance market.
The City of Sunnyvale recognizes that utility solvency, adequate survivor compensation, and a durable Wildfire Fund are legitimate and urgent state interests. Those goals should not require survivors to surrender existing legal rights, insurers to relinqui sh legitimate subrogation claims, or public agencies to absorb the direct and necessary costs of utility- caused disasters.
We therefore urge the Administration and Legislature to advance a final framework that fully protects survivor claims, rejects caps on non- economic damages, appropriately expands eligibility for non- economic damages, preserves insurer subrogation, prevents Attachment 3
The Honorable Gavin Newsom, Governor
August 25, 2026
speculative acquisition of wildfire claims, provides survivors with a voluntary Fast -Pay option, and preserves full and reasonable public-agency recovery.
Together, these principles can strengthen the Wildfire Fund while ensuring that the costs of utility-caused disasters are not unfairly transferred to survivors, policyholders, local governments, or taxpayers.
We appreciate the Administration's continued engagement with local governments and stakeholders and respectfully request that these principles be reflected in any final legislative proposal. The City of Sunnyvale welcomes the opportunity to work with the Administration and legislative leadership as the proposal moves forward. Please do not hesitate to contact me or Matt Paulin, Finance Director, at [email protected] if you have any questions.
Sincerely,
Larry Klein
Mayor
cc: Senator Dr. Aisha Wahab
Assembly Member Patrick Ahrens
City Council
Tim Kirby, City Manager
Sarah Johnson-Rios, Assistant City Manager
Matthew Paulin, Finance Director
Attachment 3