Nevada County, PG&E Agree to Proposed Settlement of Public Entities’ North Bay Fires Litigation

Nevada County, Calif. June 18, 2019 – Today, Nevada County, along with eight other counties and cities, announced that they and PG&E have accepted a mediator’s proposal of $415 million to resolve the nine public entities’ claims for losses caused by the October 2017 North Bay wildfires which included Nevada County’s Lobo and McCourtney Fires. The mediator’s proposal between PG&E and the public entities establishes a monetary value of the public entities’ claims only, and does not affect the claims of any residents, individuals, or businesses who are also pursuing PG&E for their losses, which are substantial. PG&E has estimated in bankruptcy filings that its total wildfire liabilities may be as much as $30 billion.

The collective amount of $415 million will be allocated among the nine public entities, including Nevada County, in an allocation process yet to be completed. Thus, the specific amount of each public entity’s share of the settlement payment and use of the settlement proceeds are yet to be determined. The public entities’ recoveries are intended to compensate for losses that include damage to roads and water systems, reductions in revenues, and other public losses and costs not covered by insurance or disaster assistance programs. The payment is to be incorporated in a plan of reorganization to be filed by PG&E in its pending Chapter 11 case. The plan of reorganization is subject to confirmation by the Bankruptcy Court.

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“County staff have been working diligently on creating a community that is increasingly prepared for and resilient to wildfire,” said Richard Anderson, Chairman of the Board of Supervisors. “This settlement will help Nevada County reimburse the public resources that were lost or damaged during the 2017 Lobo and McCourtney Fires, and support ongoing community services to keep us ready for wildfire.”

Mediator Judge Jay Gandhi (Ret.) presided over several days of mediation sessions between PG&E and 14 public entities damaged by the 2015 Butte Fire, the 2017 North Bay Fires, and the 2018 Camp Fire. A separate settlement amount has been agreed upon between PG&E and the public entities who were victims of the 2018 Camp Fire. Judge Gandhi’s global proposals included a total payment of $1 billion to be made pursuant to PG&E’s confirmed plan of reorganization. PG&E and all 14 public entities accepted Judge Gandhi’s proposals.

The County of Nevada was represented by County Counsel Alison Barratt-Green, and outside counsel Scott Summy and John Fiske of Baron & Budd.