Jake Bittle, Grist

FEMA moves to end one of its biggest disaster adaptation programs

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The Federal Emergency Management Agency, or FEMA, is known for responding to extreme weather like hurricanes and wildfires — the kinds of disasters that are becoming more intense and common as climate change gets worse. But the agency also has a program that sends billions of dollars to communities, municipalities, and states proactively so that they can prepare for these events before they hit.

In an internal FEMA memorandum obtained and first reported by Grist, the Trump administration announced it plans to dismantle that program — the biggest climate adaptation initiative the federal government has ever funded — even as disasters incur hundreds of billions of dollars worth of damages across the United States. The decision comes as at least seven people were killed this week as tornadoes and catastrophic flooding descended on the central United States in what meteorologists called a once in a generation event.

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The Building Resilient Infrastructure and Communities program, or BRIC, was established in 2018 during President Donald Trump’s first term, replacing a similar FEMA initiative. BRIC’s first round of funding was launched in 2020, when Trump was still in office, and in 2023, the program awarded close to a billion dollars to scores of communities, states, and Tribal Nations across the country. In January, before Trump began his second term, the agency opened its fiscal year 2024 notice of funding, with $750 million in matching grants made available to applicants from areas that received a major disaster declaration within the past seven years.

But FEMA now aims to cancel those grants and any other BRIC grants that have not been paid out yet by the federal government, according to the pre-decisional memo dated April 2 from Cameron Hamilton, a Trump administration official who is serving as FEMA administrator until the president appoints a permanent head of the agency.

“Following the Administration’s direction, FEMA is working to … implement the principles of cost efficiency and commonsense to our approaches and investments,” the memo says. The BRIC program generally shoulders 75 percent of the cost of a given resilience project, and up to 90 percent of the cost of projects in disadvantaged communities. The program’s emphasis on equity is what may have marked it for demolition — the Trump administration has been systematically dismantling Biden-era efforts to infuse equity into governmental programs and direct more climate spending toward underrepresented groups.

FEMA employees disputed Hamilton’s argument in the memo that BRIC grants “have not enhanced the level of hazard mitigation as much as desired.”

“I don’t know where that came from,” said one agency employee who preferred to stay anonymous.

According to a source within the agency, the Trump administration asked BRIC staffers to offer justification for the program and its Direct Technical Assistance sister initiative, which offers non-financial support to help communities navigate the BRIC funding process and identify the hazards they face. The request was made on Tuesday this week with a Wednesday deadline.

With a tight turnaround, staffers offered success stories from across the country. BRIC awards have helped communities bury power lines, protect wastewater facilities from being inundated by flooding, build culverts, and upgrade power stations. If the draft memo takes effect and BRIC is frozen, communities will no longer be able to apply for the grants for fiscal year 2024 made available in January. Projects that have been selected in past years but not yet disbursed funds will no longer receive payment. Partially completed projects will be scrutinized and reviewed, the memo said.

“The administration now has one of FEMA’s most effective grant programs on the chopping block,” said Shana Udvardy, a senior climate resilience policy analyst with the Climate & Energy program at the Union of Concerned Scientists. “It’s oversubscribed almost every single year.” In fiscal year 2023, FEMA received more than 1,200 subapplications across all 50 states, 35 tribes, five territories, and Washington D.C. totaling more than $5.6 billion in requests. It was able to provide less than a fifth of the money requested.

A looming question is whether FEMA can yank grants that are being funded with money appropriated by Congress. The 2021 Infrastructure Investment and Jobs Act, also known as the Bipartisan Infrastructure Law, allocated approximately $6.8 billion to FEMA for community-wide mitigation efforts, with a portion of this funding directed to the BRIC program. “If this administration does away with the program, it goes against a law that Congress passed,” Udvardy said, “so there’s a concern there to be raised.”

This article originally appeared in Grist at https://grist.org/politics/fema-moves-to-end-one-of-its-biggest-disaster-adaptation-programs/.

Grist is a nonprofit, independent media organization dedicated to telling stories of climate solutions and a just future. Learn more at Grist.org

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While President Donald Trump has issued a flurry of far-reaching decrees during his first week in office, one relatively niche issue has received a disproportionate share of the president’s ire and attention: California water policy. That might make sense if the remedies he’s pursuing could help stem deadly fires like those that have killed at least 29 people in the Los Angeles area in recent weeks. Indeed, the president has claimed that “firefighters were unable to fight the blaze due to dry hydrants, empty reservoirs, and inadequate water infrastructure.”

But unfortunately for future fire victims, the sole apparent aim of the president’s new policies is to deliver more water to farmers hundreds of miles away from the state’s fire zones.

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On his first day as president, Trump issued an executive order that directed his Interior Department to “route more water” to the southern part of the state. Then, on Sunday he issued another order that directed the department to immediately “override” the state’s management of its water, even if it meant overruling California law. The order also suggested Trump could withhold federal wildfire aid if the state failed to comply to his satisfaction.

But the new measures wouldn’t deliver any more water to Los Angeles at all. Instead, his attempt to relax water restrictions would move more water to large farms in the state’s sparsely populated Central Valley, a longtime pet issue for the president, who attempted a similar maneuver during his first term. This time he’s going further, proposing to gut endangered species rules and overrule state policy to deliver a win for the influential farmers who backed all three of his campaigns.

None of this has any relation to wildfires in Los Angeles. For one thing, the city isn’t experiencing a water shortage. It was ferocious, hurricane-force winds that fanned the Palisades and Eaton Fires — not a lack of water to contain the blazes. While some local water tanks in the neighborhood of Pacific Palisades did run out of water, that was only because the city couldn’t pump new supplies up to the hillside neighborhood fast enough to keep up with skyrocketing demand during the fire, not because there wasn’t enough water available to send there.

Even if Los Angeles were low on water, Trump’s executive orders wouldn’t help with that, because the federal government’s canal system doesn’t actually deliver any water to the Los Angeles area. More than 90 percent of that water goes to farms in the Central Valley, with the rest going to far-away cities around San Francisco and Sacramento. All this water is already spoken for, and during dry years the government can’t even fulfill all its existing contracts. The most it can do is potentially ease environmental rules that limit some of the pumping, which farmers have long opposed.

But even some farm advocates are skeptical of the sweeping scope of Trump’s most recent order, and its specious connection to wildfire.

“I am always appreciative of attempts to create more flexibility for moving water around the state, but [federal] water by and large goes to agricultural contractors,” said Alex Biering, the senior policy advocate at the California Farm Bureau Federation, the state’s leading agricultural lobby. “I don’t believe that any amount of additional water coming from the federal project would be able to be applied to stop that fire. It’s an attempt to tie water supply to a natural disaster, but those connections don’t exist in reality.”

Environmental groups, meanwhile, have blasted Trump’s attempt to strongarm California water policy, saying his most recent order would be devastating for the state’s vulnerable fish species — and the integrity of the federal Endangered Species Act as a whole.

“It’s unrecognizable as anything that anybody who knows anything about California water would write,” said Jon Rosenfield, the science director at San Francisco Baykeeper, an environmental nonprofit in the Golden State. “It’s not from this planet.

California’s water system has been the subject of heated political debate for decades. Over the course of the 20th century, the federal government and the state of California built a complex series of dams and canals designed to move water from the northern parts of the state, which see substantial precipitation and snowmelt, down to the agriculture-rich Central Valley and the Los Angeles metropolitan area. The federal government operates dams, canals, and pumping stations that push water south through the valley, and then the state operates the canal that extends down to Los Angeles. The system provides water to around 30 million Californians and irrigates around 4 million acres of the nation’s most productive farmland.

The crux of this transport system is the Sacramento-San Joaquin Delta, a sensitive marshland region where two of the state’s largest rivers converge and flow out into the San Francisco Bay. This area is also the point where endangered fish species like Chinook salmon enter from the Pacific and swim upstream to spawn. If the federal and state pumps move too much water out of the Delta for farms and cities, they reverse current flows, pulling fish toward their predators or sucking them into the pumps. This is a violation of the Endangered Species Act. One of these vulnerable fish species, the 2-inch gray baitfish known as the Delta smelt, is particularly sensitive to these current changes, and the government often limits its pumping to protect it.

On Monday night, Trump erroneously claimed in a Truth Social post that he had the military “turn on the water … flowing abundantly from the Pacific Northwest, and beyond” by activating the pumps, which had been offline for a few days for maintenance. The pumped water does not come from the Pacific Northwest, and because the federal government already controls the pumps and uses them all the time, such an action does not require the involvement of the military.

It’s California’s own state-run canal system that actually delivers water to Los Angeles and numerous other cities in Southern California — and the federal government has no jurisdiction over this. The state government curtails these water deliveries somewhat during dry years to maintain a robust supply, and it seldom provides all the water that each city requests. However, deliveries to Los Angeles were typical last year, and reservoir levels in the state are above average. (Furthermore, the Los Angeles metro gets a larger share of its water from other sources, like the Colorado River and the Owens Valley.)

Despite his East Coast upbringing, Donald Trump has fixated on Central Valley water issues for years. He chose David Bernhardt, who has lobbied for the influential Westlands Water District, to lead the Department of the Interior during his first administration. He also hosted multiple rallies in the region during his 2020 campaign, during which he frequently foregrounded water policy. During his appearance on the Joe Rogan podcast last year, then-candidate Trump led the host through a diatribe about water, describing dried-out farmland he saw while traveling through the region with Central Valley members of Congress years earlier.

“We’re driving up, and I had never seen it before,” he said. “I said, ‘Do you have a drought? They said, ‘No … in order to protect a tiny little fish, the water gets routed into the Pacific.’ So I see this, and I said, ‘You’ve got to be kidding.’”

During his first term, Trump did draft new rules in an attempt to accelerate water deliveries from the Sacramento-San Joaquin Delta. Those rules proposed that pumping should be limited only when smelt-friendly turbid waters are present in the Delta, but they also contained a few provisions that farm groups said led to wasted water during recent wet periods, and failed to prevent salmon death even by their own metrics. After Joe Biden succeeded Trump in office, the Democratic president tweaked those rules in a joint effort with the state of California — and many environmental groups have criticized Biden’s rules as worse for fish than Trump’s.

Trump may go much further this time. His most recent executive order calls for another wholesale rewrite of the pumping rules, proposes building new dams around the state, and even suggests that his administration could declare the Delta smelt functionally extinct. It also proposes to convene the federal committee known colloquially as the “God Squad,” a group of agency heads that can grant exemptions to the Endangered Species Act. This has only happened a few times since the law took effect, but in theory the “God Squad” could allow the government to pump much more water to farms, even if it means jeopardizing the very existence of smelt or salmon runs — or drying out the Delta.

Some of California’s most powerful water districts, which are typically run by large agricultural landowners, have praised the executive order, although they haven’t followed Trump in connecting it to the fires. For instance, the Westlands Water District, which covers more than half a million acres on the west side of the Central Valley, said in a statement that they “welcomed” Trump’s “leadership in addressing the barriers to water delivery.”

But despite the bluster of the White House actions, it’s far from clear that any of these changes will come to pass, at least in the short term. California water is one of the most heavily litigated issues in the United States, and even small tweaks to the state’s pumping system would likely raise legal challenges.

“They can try a lot of this stuff,” said Biering, the California Farm Bureau advocate. “It’s just about: How many times do you want to get sued?”

This article originally appeared in Grist at https://grist.org/politics/trump-california-water-los-angeles-fire/.

Grist is a nonprofit, independent media organization dedicated to telling stories of climate solutions and a just future. Learn more at Grist.org

During the heat of the presidential campaign in September, then-candidate Donald Trump made an extraordinary threat. He vowed that if California suffered a wildfire during his presidency, he’d withhold disaster aid from the state unless Governor Gavin Newsom signed a document that delivered more water to farmers in the state’s agriculture-rich Central Valley.

“If [Newsom] doesn’t sign those papers, we won’t give him money to put out all his fires,” Trump said. “And if we don’t give him all the money to put out the fires, he’s got problems.”

In the wake of the devastating Palisades and Eaton fires in Los Angeles, which have destroyed thousands of homes and killed dozens of people over the past two weeks, Trump’s threat to withhold aid from the Federal Emergency Management Agency has surfaced again. As the fires raged, the new president rushed to blame them on Newsom’s water policies, repeating his disproven claim that the state’s policy of limiting water deliveries out of the Sacramento Delta to protect a species of endangered fish has hobbled firefighting efforts. He then appeared to repeat his threat on Truth Social: “NO WATER IN THE FIRE HYDRANTS, NO MONEY IN FEMA.”

As Trump takes office and prepares to visit Los Angeles this week, his allies in Congress are picking up the threat as they consider a supplemental bill that would provide billions of dollars in aid money to fire victims through the Department of Housing and Urban Development. Speaker of the House Mike Johnson, a representative from Louisiana, said that he believes there “should be conditions” on that aid.

“Obviously, there’s been water resource mismanagement, forest management mistakes, all sorts of problems,” he said in a comment to reporters last week. Even some California Republicans, such as Representatives Doug LaMalfa and Darrell Issa, agreed that Congress should consider limiting long-term aid.

But disaster experts say these threats aren’t likely to bear fruit — or at least will be harder to accomplish than many of the new president’s other climate-related policies.

“I don’t know how you stop it so much as you just make it a pain in the butt,” said Craig Fugate, who led FEMA under President Barack Obama.

The difficulty for Trump is that the FEMA recovery process in California has already begun. President Biden issued a disaster declaration just hours after the fires began, giving FEMA the legal authority to spend money on emergency response, rescue, and shelter efforts in Los Angeles, and to begin doling out money to victims who have lost their homes and belongings. Even if Congress doesn’t send the agency any more money, FEMA has enough funding in the bank to address victims’ immediate needs, a. This is by design: when Congress set up FEMA in 1980, it gave agency officials flexibility to deploy money fast as new disasters happened. Lawmakers (usually) top up the agency’s budget before each disaster season takes place.

But bigger costs are yet to come. FEMA itself doesn’t rebuild roads or water systems in disaster-affected areas. Instead, the agency reimburses states and cities for the money they spend on those rebuilding efforts. In order to get reimbursed, states have to submit cost estimates, and it’s far too early for California to assess the cost of recovery.

But once the state does submit those reimbursements, FEMA doesn’t have the authority to approve or deny them discretionarily, according to Fugate.

“I’m not saying it’s impossible, but it would be really difficult for any administration to try to hold funds arbitrarily,” he said. “It’s just like writing a check, it’s kind of hard to cancel it after you’ve already written.”

The most Trump could do would be to delay the aid process through bureaucratic channels. The federal Office of Management and Budget has to review all FEMA projects with values over $1 million, and Trump could order that office to quibble with the details of every request before approving them. Later on this year, FEMA could also decrease the share of rebuilding costs it offers to pay, but it would still be on the hook for most of the money. Trump did not mention FEMA in his dozens of day-one executive orders this week, but he did sign an order seeking to revise federal policies for moving water out of the Sacramento-San Joaquin Delta, an issue he has inaccurately linked to L.A.’s recent fires. (The Trump transition team did not respond to requests for clarification on the president’s threat.)

Even if Trump does throw sand in the gears of reimbursement, California might be able to handle some delay. The state is the world’s sixth-largest economy, with a more than $300 billion budget, and lawmakers are already conferring about whether to pass supplemental state money to aid in the wildfire recovery. (California’s Office of Emergency Services did not respond to a request for comment.)

Wildfires also represent a lower share of FEMA’s disaster spending than do other disasters like hurricanes and floods. FEMA has spent an average of $345 million on infrastructure rebuilding per fire since 2015, compared to an average of almost $1 billion per hurricane, according to FEMA data compiled by the Carnegie Endowment for International Peace. Fire victims account for just 1 percent of FEMA’s individual aid applications since 2015.

That’s in part because most fires tend to strike less populated areas — and because insurance tends to cover a larger proportion of wildfire destruction, said Sarah Labowitz, a nonresident fellow at Carnegie and an expert in disaster funding.

“It’s supposed to be a three-legged stool, where FEMA sits along insurance and private money,” she said. “For fires, typically people have some kind of fire insurance, so the level of uninsured loss could be lower than for a big water event.” But given the scale of the loss in these urban fires, and the fact that many insurers have pulled away from places like Pacific Palisades, FEMA may have a larger tab this time than it has in past fires.

Rather than the new Trump administration, it’s Congress that California should be worried about. The Department of Housing and Urban Development, or HUD, has over the past two decades allocated tens of billions of dollars toward long-term disaster recovery with Congress’ blessing, including after blazes such as the 2018 Camp Fire. Many states use this federal money to aid in housing redevelopment; for instance, California used the largest share of its Camp Fire money to build and acquire new multifamily properties.

This housing money will be essential in L.A.’s strained real estate market, where median rents are over $3,000 per month and an average single-family home goes for close to $1 million. But unlike FEMA, which can start spending money out of its main disaster fund as soon as the president declares a disaster, HUD needs explicit permission from Congress to start a recovery program for each new disaster. Speaker Johnson is now suggesting he would like to see California agree to “conditions” before he gives HUD the nod, telling reporters earlier this month that “we have to make sure there are safeguards on the precious treasure of the American people.”

Without this supplemental HUD money, it will be hard for California to pursue the kind of long-term recovery that experts believe is necessary after climate disasters like the Los Angeles wildfires. The state might be able to find money in its own coffers to make up for delays in critical aid money from FEMA, but it will be much harder to come up with cash to build new homes or stand up a workforce development program, as California has sought to do with the $1 billion in recovery aid it received from HUD for the 2018 Camp Fire. Not only is Los Angeles one of the most expensive places in the country to build a home, but California just finished closing a more than $50 billion budget deficit, leaving it with little money to spare.

Labowitz says that Congress has dithered on passing HUD aid before. For instance, lawmakers took until December 2024 to give the agency authority to spend money on the Maui wildfires, which occurred in August of 2023. But despite the threats from Johnson and other Republicans, she said it’s likely that lawmakers will send aid money eventually, if only to ensure that Democrats don’t withhold it from disaster-prone states like Texas and Florida in the future.

“We have a federal infrastructure that finds a way to make itself work most of the time,” she said. “Usually for the biggest disasters, the system does find a way to work to deliver aid.”

Randy and Miki Quinton held hands as they walked uphill into what remains of their neighborhood in Altadena, the unincorporated Los Angeles suburb where they had lived for more than 20 years. After they entered the barricaded neighborhood through an open alleyway with two of their friends on Friday, the husband and wife confronted a scene of utter devastation: The Eaton Fire had incinerated hundreds of homes and cars in the middle-class neighborhood, leaving behind only ash-soaked chimneys and flaming gas lines. The Quintons’ own house had been vaporized, along with all their belongings.

“Twenty-four, forty-eight hours, and it’s all gone,” Randy told Grist.

The Quintons and thousands of other families now confront a living nightmare as they begin to recover from the most devastating wildfire outbreak in modern U.S. history. The Eaton Fire and the Palisades Fire, which overwhelmed coastal neighborhoods about 30 miles away, have together killed at least 24 people and destroyed well over 10,000 structures.

How the victims rebuild their lives will now depend largely on California’s beleaguered home insurance market. Unlike many fire victims in other parts of the L.A. area, the Quintons and many of their neighbors had been able to maintain their insurance policies in the leadup to the fire, even as companies dropped thousands of other fire-prone customers across California and in other states across the country.

.“We’re blessed in that regard,” said Quinton.

The coverage may bode well for the recovery of the diverse neighborhood, which was home to many long-tenured Black families who have owned property in Altadena since the Civil Rights Era. That stability may not last, however, as California’s insurance market continues to contract following the fires, which have caused more than $20 billion in insured losses, according to preliminary estimates. Insurance companies will almost certainly have to raise prices and drop risky customers to make up for billions of dollars in payouts on high-value L.A. homes. While the availability of insurance in recent years may help displaced Altadena residents return, they will be coming back to a neighborhood that will likely be far less affordable than it once was. In a county where the median home price is around $900,000, that leaves the future uncertain for many longtime Angelenos.

Despite the fact that Altadena sits within the “wildland-urban interface” — the area where housing development pushes up against the fire-prone hills — Altadena’s affected neighborhoods do not appear on a list of “distressed areas” that the state insurance commissioner published last year. The average premiums in the neighborhood were around $2,300 a year, well below those of other fire-prone areas in the north of the state, and fewer than 10 percent of people in the areas that burned got their coverage through the state-backed insurer of last resort, though that number has been ticking up in recent years.

“Without [insurance] we’d be lost, it’d be over,” said Kevin Devine, a security guard and lifelong Altadena resident who also lost his house in the fires. “We’ve been here all our life, and I think we’re going to be able to come back stronger. We’re not going to let a fire stop us.”

Devine grew up in the house, which his mother bought almost half a century ago. He returned to the neighborhood last week to examine the wreckage of his home with his son and his twin brother Keith, who is also a security guard. His sister lived up the road and lost her home as well, but Kevin said the siblings could stay with family members in a nearby suburb while they waited to rebuild their homes.

The insurance situation is much different in wealthy Pacific Palisades, where another massive wildfire still raged early this week. Even before the fire, most homeowners in the Palisades and on the shoreline near Malibu could no longer secure traditional insurance coverage, which meant they had to rely on the California FAIR Plan, the state-backed insurer of last resort. Even that was not enough to cover many homes: The FAIR plan only covers damages up to $3 million, and many homes in Pacific Palisades are worth far more than that. People in those homes often secured coverage through so-called surplus lines insurers that charge premiums that run in the tens of thousands of dollars per year.

Altadena has not yet experienced issues like these, but that might not last. California prohibits insurance companies from dropping customers in fire-struck areas for at least a year, but customers might be issued non-renewals as soon as that moratorium expires. In the meantime, insurance companies might stop writing new policies for people who move into the neighborhood. California also just finalized rules that will allow insurers to increase prices further and faster. (Insurance companies say these increases are necessary to account for climate change and inflation.)

The impact of the loss in the wealthy Palisades will also be felt in more modest Altadena as insurers pay out billions of dollars in claims on high-value homes. The FAIR plan has a stunning $24 billion of exposure in the area affected by the fires, and paying out those claims over the coming years would wipe out its existing reserves. Once the program runs out of money, it will impose an assessment on insurance companies according to their market share in the state, who can then pass the costs of that assessment to their customers, including those in less vulnerable areas.

This all means that Altadena may soon experience both a rise in insurance prices and gaps in coverage, which will raise pressure on homeowners as they return — and may weigh on the value of their homes.

“I don’t expect an insurance market collapse,” said Nancy Watkins, a principal actuary at Milliman, a leading risk analysis firm. However, she added, “I think prices may be depressed by insurance premiums going up, and people being potentially more fearful of living in California.”

There is one way to mitigate this price pressure: If Altadena rebuilds in a manner that is more resilient to wildfires, using fire-resistant home materials for new construction and carving out a buffer between the city and the fire-prone mountains nearby, insurance companies would be required under California law to offer future residents discounts on their premiums. The town of Paradise mandated such construction after the 2018 Camp Fire destroyed thousands of homes there. Insurance companies have finally started offering policies in Paradise again in recent months.

It will be up to the government of Los Angeles County, which has jurisdiction over unincorporated Altadena, to decide on the standards for the town’s rebuild.

Nic Arnzen, a member of Altadena’s town council who lost his home in the fire, said that he believed the county needed tougher standards for fire-safe construction.

“The county has been working on that,” he told Grist. “They are not sufficient at this point, and as a town, we will use our strength to be sure that our town is safe.” However, he also added that residents are anxious to protect the neighborhood’s architectural history and said he hoped the county government would offer residents flexibility as they secured permits to rebuild.

“We have been assured that they will lift some certain restrictions and make the process easier,” he said. Many older homes in the neighborhood that were destroyed in the fire would be too large to rebuild under current codes.

When it comes to the town’s proximity to the fire-prone San Gabriel Mountains, Arnzen said Altadena was the victim of poor timing. The town council had just helped the county approve a long-term plan to gradually reduce housing density in the most dangerous foothills of the town. It was scheduled to go into effect this year and might have minimized some of the damage from the fire.

“We were already on that, but we missed it by a year,” he said.

On Tuesday, after a ferocious Santa Ana windstorm blew through Southern California, a severe brush fire broke out in the wealthy Pacific Palisades neighborhood of Los Angeles, burning 1,000 structures and forcing tens of thousands of residents to evacuate as of Wednesday afternoon. Another large brush fire broke out near Pasadena around the same time, killing at least two people. Together the two blazes threatened some of the most valuable homes and businesses in the United States. The damage from the Palisades Fire alone could exceed $10 billion, according to a preliminary estimate from J.P. Morgan.

If this estimate holds true, it will test insurers’ commitment to a market that has been teetering on the verge of collapse for the better part of a decade now. Over the past five years, California has become a poster child for what climate-fueled weather disasters can do to a state’s home insurance market. Following a rash of historic wildfires in 2017 and 2018, insurance companies have fled the state, dropped tens of thousands of customers in flammable areas, and raised prices by double-digit percentages.

Until recently, elected officials have taken few major steps to address the crisis. But late last month, after more than a year of drafting, California’s insurance commissioner unveiled a set of reforms that he claimed will bring companies back into the fold as they take effect this year.

“This is a historic moment for California,” said Ricardo Lara, the state’s insurance commissioner, when he revealed the rules in December. “With input from thousands of residents throughout California, this reform balances protecting consumers with the need to strengthen our market against climate risks.”

The rules come after months of debate among state insurance officials, lawmakers, insurance companies, and consumer advocates. The biggest change is that California will now require many insurance companies to do more business in what the state calls “distressed areas,” the fire-prone scrubland and mountain regions where insurers are now hiking prices and dropping customers. Companies will soon have to ensure that their market share in these areas is at least 85 percent of their total statewide market share — in other words, if a company controls 10 percent of the state’s insurance market, it must control at least 8.5 percent of the market in fire-prone areas.

This mandate should push big companies like State Farm and Allstate to pick up customers they’ve dropped in flammable regions like the mountainous north of the state. Some companies have already begun to offer new policies in burned areas in anticipation of the state’s new rules: the insurance company Mercury announced last week that it will be the first insurance company in the state to offer new policies in Paradise, California, which was destroyed in the catastrophic 2018 Camp Fire. The move recognizes the town’s work to mitigate future fires by clearing trees and hardening homes.

The requirement to expand coverage, coupled with recent announcements from companies like Mercury, “should give consumers hope that competition and options will be returning,” said Amy Bach, the head of insurance customer advocacy group United Policyholders, in a statement.

In return for this added coverage, the state is making a few big tweaks that will allow insurers to pass on the price of fire risk to their customers. California is the only state in the country that doesn’t allow insurance companies to use forward-looking “catastrophe models” when they set prices. It also prohibits companies from factoring in the rising costs of reinsurance, the insurance purchased by insurance companies to ensure they’re able to pay out big claims.

These two restrictions have kept prices artificially low for years, and also prevented insurers from planning for climate change impacts, creating a de facto subsidy for homeowners in risky areas.

“This addresses the major stumbling blocks that companies have been identifying for a decade, so that’s a positive,” said Rex Frazier, the president of the Personal Insurance Federation of California, the state’s leading insurance trade group.

This trade-off has some residents in fire-prone areas worried. Insurance companies might now have to offer more policies in flammable zones, but they also have more latitude to increase prices.

“I’m not optimistic that it will improve the experience of the consumer as the insurers can now pass certain costs onto consumers which I’m expecting will result in higher premiums,” said Jason Lloyd, who moved to mountainous Lake County last spring. He and his wife came to the area because they wanted to be closer to his wife’s family, but when they made an offer on a home, they learned that they would have to pay more than $8,000 a year for insurance, or else go to the California FAIR Plan, a state-run insurance program that offers minimal coverage.

Lloyd and his wife later bought another home in Hidden Valley Lake, a town that has taken ambitious steps to reduce flammable vegetation, but their insurance premium is still more than $4,500 a year, more than triple what it was on their last home in Kansas. Lloyd is worried that his insurance company will hike his price further under the new rules.

Other states across the West such as Colorado and Oregon are also seeing insurance coverage gaps emerge after big wildfires, though their problems are less acute than those in the Golden State. In Colorado, for instance, officials just recently established a state fire insurance backstop like California’s FAIR Plan, since it’s only in the past few years that customers there have been dropped en masse. California’s grand bargain with the insurance industry provides a blueprint for those other states: If you want to address coverage gaps, you need to give insurers broader authority to set prices.

Even this might not be enough. The past few years have seen a reprieve from major wildfires like the ones that struck in 2017 and 2018, but this week’s blazes in the Los Angeles area could cause billions of dollars of damage, on par with an event like the Camp Fire.

Joel Laucher, a former regulator and fire insurance expert at the consumer advocacy organization United Policyholders, said that the damage from the Los Angeles blazes could lead to further price hikes and more availability gaps.

“These are going to be major losses, certainly,” he told Grist. “Certain areas are definitely going to have new challenges, to the degree that insurers are going to be able to charge to the rate they believe those areas deserve to pay.” Laucher said that insurance companies may not decline to renew as many policies as they might have under previous state rules, but they could still avoid selling policies in some of the affected areas.

Frazier, of the insurance trade group, voiced similar concerns. He said that another round of monster blazes on the scale of 2017 and 2018 could drive the insurance industry away from the state once again, despite the commissioners’ reforms.

“If we were to have a couple more unprecedented years, all bets are off,” he told Grist.