SACRAMENTO, Calif. - Camp Fire survivor Danielle Patrich was livid to hear that the federal government is trying to carve out money from the Pacific Gas and Electric Co's bankruptcy - money that would otherwise go to victims like her.
Patrich said she had to go to the Federal Emergency Management Agency's Chico office 12 times after she and her husband lost their home and livelihoods after the November 2018 disaster, and they still haven't seen a dime of a federal loan that was approved so they could rebuild.
"Even if we had gotten money from FEMA, it would still upset me because, you know, you do pay taxes and you kind of hope at your lowest point of low, after something like this that your government can come step up and help you," she said Monday. "It's been more of a headache than the fire, honestly."
FEMA is demanding billions in reimbursement for California wildfire expenses from PG&E - and suggesting that it might seek a portion of the money from wildfire victims if it doesn't get what it wants from the utility.
FEMA's efforts to collect $3.9 billion from PG&E - and possibly the fire victims - is generating considerable blowback from Democratic and Republican members of Congress as well as lawyers for wildfire victims. The state of California is seeking money as well.
"It is outrageous that State and Federal government may take settlement funds from wildfire victims," U.S. Rep. Doug LaMalfa, a Republican from Richvale who represents Camp Fire victims, said in a Facebook post early Monday. "It is the governments' job to set aside funds for disasters. While the government should seek reasonable reimbursement for costs from PG&E, victims shouldn't get caught in the middle of their disputes."
Robert Julian, a Los Angeles lawyer representing fire victims in PG&E's bankruptcy, told The Sacramento Bee on Monday: "FEMA cannot collect anything under the law." A hearing is set for Feb. 11 in U.S. Bankruptcy Court.
FEMA says it has an obligation to protect taxpayers' dollars. "We have no interest in reducing the funds PG&E owes to survivors," the agency said in a prepared statement Monday. "Instead, we are interested in ensuring taxpayers do not bear the burden of PG&E's responsibility for the billions of dollars FEMA provided to assist individuals and communities impacted by wildfires."
At issue is the $13.5 billion PG&E has agreed to pay wildfire victims as part of its plan to exit Chapter 11 bankruptcy. The pot of money would also go to pay claims to federal and state agencies. FEMA has filed a claim for $3.9 billion as reimbursement for the help it gave fire victims, the state and others following the 2018 Camp Fire, the 2017 wine country fires and the 2015 Butte Fire in Amador and Calaveras counties.
California state agencies also are seeking billions from PG&E, although they've acknowledged that they were already reimbursed for most of their expenditures by FEMA.
Wildfire victims have already filed objections in bankruptcy court to the government agencies' claims.
"The government claims compete with and have the potential to diminish the funds available to pay individual fire victims and businesses," victims' lawyers said in court papers last month.
Last week a bipartisan group of California members of Congress urged Peter Gaynor, the acting head of FEMA, to withdraw its claim in the bankruptcy court. "This claim by FEMA ... puts at risk the possibility that the thousands of families still struggling to rebuild their lives will not receive the restitution they deserve," they wrote.
The controversy intensified over the weekend when FEMA regional administrator Bob Fenton told the San Francisco Chronicle that his agency might seek reimbursement from victims themselves if PG&E doesn't pay what it owes.
On Monday, FEMA spokesman Robert Barker said the agency would attempt to retrieve, at most, $100 million from fire victims, representing the amount of individual assistance paid to the victims. He said FEMA has never attempted such a recovery before, would be extremely reluctant to take such a step and doesn't know what form it would take.
"We really haven't played out a scenario like this before, we can't say exactly what we're going to do," Barker said. "Yes, it will be complicated and yes, it will be difficult and, yes, it will be disruptive for wildfire survivors."
FEMA is basing its claim against PG&E on federal law, the Stafford Act, which says the agency can demand reimbursement from someone who deliberately causes a big disaster.
But fire victims' lawyers said in court papers that, while PG&E has been blamed by state investigators for causing the wildfires, there have been no allegations that the utility deliberately lit the fires. "Negligence is not the same as intentionally causing a fire or committing arson," the lawyers wrote.
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