Chapter 5 - Operation of the Account

California Public Utilities Code — §§ 3299-3299.20

Sections (6)

Added by Stats. 2025, Ch. 119, Sec. 46. (SB 254) Effective September 19, 2025. Conditionally repealed on date prescribed by its own provisions. Note: Repeal affects Chapter 5, commencing with Section 3299; see additional repeal provisions in Section 3299.20.

(a)(1) (A) Within 15 days of the effective date of this chapter, each large electrical corporation shall provide to the commission a written notification of its election to participate, or not to participate, in the account and provide, if applicable, annual contributions and additional contributions pursuant to this chapter.

(B) A large electrical corporation’s election to participate in the account shall be considered as its agreement to do all of the following:

(i)To authorize the administration of the account by the administrator pursuant to this chapter and Chapter 4 (commencing with Section 3298).

(ii) To provide an annual contribution pursuant to subdivision (a) of Section 3299.3 and any additional contributions pursuant to subdivision (b) of Section 3299.3.

(iii) To consent to the changes in the operation of the fund as provided in clause (ii) of subparagraph (C) of paragraph (2) of subdivision (h) of, and subdivision (k) of, Section 3292, as those provisions read on the effective date of this chapter.

(iv) To authorize the use of the Wildfire Fund assets and account assets for purposes of Section 719, as added by the measure adding this chapter.

(2)A large electrical corporation that fails to provide the notification pursuant to this subdivision is deemed to have elected not to participate in the account.

(b)If all large electrical corporations provide written notification to the commission of their election to participate in the account and their commitment to provide annual contributions and additional contributions pursuant to this chapter, the commission shall notify the administrator, the Secretary of State, and the relevant policy committees of the Legislature of the election.

(c)If a notification provided pursuant to subdivision (a) indicates that a large electrical corporation has elected not to participate in the account, or if a large electrical corporation fails to provide the notification pursuant to subdivision (a), the commission shall provide notification of the nonparticipation to the administrator, Secretary of State, and the relevant policy committees of the Legislature and this chapter shall become inoperative on the date of the notification and is repealed on

January 1 of the year following the notification.

§ 3299.1

Added by Stats. 2025, Ch. 119, Sec. 46. (SB 254) Effective September 19, 2025. Conditionally inoperative pursuant to Sections 3299 and 3299.20. Repealed as of January 1 following inoperative date.

(a)On or after the date the commission provides the notification pursuant to subdivision (b) of Section 3299, but not later than December 31, 2028, the administrator may determine if additional annual contributions pursuant to subdivision (b) of Section 3299.3 are required for either of the following reasons:

(1)Absent additional annual contributions, the administrator would provide a plan for winding up the fund pursuant to Section 3283.

(2)The administrator receives a notification from a large electrical corporation that it has a reasonable belief that it likely will have eligible claims for a single coverage year resulting from one or more covered wildfires.

(b)If the administrator determines that additional contributions are required, the administrator shall provide notification to the commission, the Department of Water Resources, and each large electrical corporation of its determination.

§ 3299.2

Added by Stats. 2025, Ch. 119, Sec. 46. (SB 254) Effective September 19, 2025. Conditionally inoperative pursuant to Sections 3299 and 3299.20. Repealed as of January 1 following inoperative date.

(a)Within 15 days of receiving the notification pursuant to Section 3299.1, the commission shall initiate a rulemaking proceeding to consider using its authority pursuant to Section 701 to require each large electrical corporation to collect a nonbypassable charge from ratepayers of each large electrical corporation to support the account, including the payment of bonds issued pursuant to paragraph (2) of subdivision (a) of Section 80540 of the Water Code, in an amount sufficient to fund the revenue requirement as established pursuant to Section 80524 of the Water Code.

(b)If the commission determines that the imposition of the charge described in subdivision (a) is just and reasonable, and that it is just and reasonable to exercise its

authority pursuant to Section 701 to do so, the commission shall direct each large electrical corporation to impose and collect that charge commencing February 1, 2036. The charge shall be collected in the same manner as that for the payments made to reimburse the Department of Water Resources under paragraph (2) of subdivision (a) of Section 3289.

(c)Notwithstanding other law, no later than 90 days after the initiation of the rulemaking proceeding, the commission shall adopt a decision regarding the imposition of the charge.

(d)Notwithstanding Sections 455.5 and 1708, or any other law, the commission shall not revise, amend, or otherwise modify a decision to impose a charge imposed pursuant to this section before January 1, 2046.

§ 3299.10

Added by Stats. 2025, Ch. 119, Sec. 46. (SB 254) Effective September 19, 2025. Conditionally inoperative pursuant to Sections 3299 and 3299.20. Repealed as of January 1 following inoperative date.

(a)A large electrical corporation may seek payment from the account to satisfy settled or finally adjudicated eligible claims. Only eligible claims shall be made against or paid by the account. In accordance with the procedures established by the administrator, the administrator shall review and approve any settlement of an eligible claim as being in the reasonable business judgment of the large electrical corporation before releasing funds to the large electrical corporation for payment. To the extent approved by the administrator, a settlement shall not be subject to further review by the commission.

(b)(1) Except as provided in paragraph (2), within six months of the commission adopting a decision for an application

filed pursuant to Section 1701.8, a large electrical corporation shall reimburse the account for the full amount of costs and expenses the commission determined were disallowed pursuant to Section 1701.8.

(2)(A) The requirement on a large electrical corporation to reimburse the account shall be the lesser amount of subparagraph (B) or (C).

(B)The costs and expenses determined not to be just and reasonable pursuant to Section 1701.8.

(C)(i) The amount determined pursuant to clause (ii) minus the amount determined pursuant to clause (iii).

(ii) Twenty percent of the large electrical corporation’s total transmission and distribution equity rate base, including, but not limited to, its Federal Energy Regulatory

Commission (FERC) assets, as determined by the administrator for the calendar year in which the ignition of the covered wildfire occurred.

(iii) The sum of the amounts actually reimbursed to the account for measurement costs that were determined not to be just and reasonable pursuant to Section 1701.8 added to the amount of any reimbursements to the account owed by the large electrical corporation for measurement costs disallowed that have not yet been paid.

(iv) For purposes of this subparagraph, “measurement costs” means costs and expenses that arose out of any covered wildfire ignited within three years of the ignition of the wildfire that is the subject of the application and any measurement costs as defined in subparagraph (C) of paragraph (2) of subdivision (h) of Section 3292.

(D)The administrator shall

publish calculations of the amounts determined pursuant to subparagraphs (B) and (C) on or before January 1 of each calendar year for each large electrical corporation.

(E)Except as provided in paragraph (3), a large electrical corporation shall not be required to reimburse the account for any additional amounts for any measurement period.

(F)The limitation set forth in this section shall apply only so long as the account has not been terminated pursuant to paragraph (2) of subdivision (d) of Section 3298.

(3)Paragraph (2) does not apply under either of the following circumstances:

(A)If the administrator determines that the large electrical corporation’s actions or inactions that resulted in the covered wildfire constituted conscious or willful

disregard of the rights and safety of others.

(B)If the large electrical corporation failed to maintain a valid safety certification on the date of the ignition.

§ 3299.20

This chapter shall become inoperative if a large electrical corporation elects not to participate pursuant to Section 3299 and is repealed on January 1 of the year following a notification by the commission pursuant to subdivision (c) of Section 3299.

§ 3299.100

Added by Stats. 2025, Ch. 119, Sec. 47. (SB 254) Effective September 19, 2025.

(a)For purposes of this section, “third-party entity” means an entity, other than a large electrical corporation, other insurer or reinsurer admitted to conduct the business of insurance in California or in compliance with Sections 1765.1 and 1765.2 of the Insurance Code, or a law firm or business retained by an insurer for the purpose of assisting with the pursuit of the property insurer’s subrogation rights, that seeks to enter into an agreement with a property insurer.

(b)Any agreement entered into on or after the effective date of this chapter by a property insurer to sell, assign, or transfer, in whole or in part, to a third-party entity, a right of subrogation, reimbursement, or recovery, as applicable, including a right to recover

attorney fees, resulting from a wildfire that is ignited on or after the effective date of this chapter and that destroys 1,000 or more structures is subject to all of the following:

(1)Before entering into an agreement with the third-party entity, the property insurer shall first offer to settle its right of subrogation, reimbursement, or recovery, as applicable, on the same terms and conditions as the proposed agreement, to the large electrical corporation, if any, that provides electrical service to the service area in which the wildfire ignited.

(2)Within 30 days of the property insurer making the offer to settle pursuant to paragraph (1), the large electrical corporation shall accept or reject the offer to settle or otherwise reach an agreement on mutually agreeable terms with the property insurer for the settlement of that right with the large electrical corporation.

(3)If the large electrical corporation accepts the property insurer’s offer to settle, or otherwise reaches an agreement with the property insurer on mutually agreeable terms, the property insurer shall execute a release that will release the large electrical corporation from, and bar the property insurer from bringing or pursuing, any lawsuit, claim, arbitration, or other legal action of any kind against the large electrical corporation for damages resulting from the applicable fire with respect to the rights sold, assigned, or transferred to the electrical corporation. The release shall not preclude actions to enforce the terms of the accepted offer or agreement between the electrical corporation and the property insurer.

(4)If the large electrical corporation rejects the offer made, or fails to reach an agreement within 30 days, pursuant to paragraph (2), the property insurer

and the third-party entity may enter into an agreement for the sale, assignment, or transfer of the right under either of the following conditions:

(A)The agreement is on the same terms and conditions as the offer made to the large electrical corporation pursuant to paragraph (1).

(B)If the agreement is on different financial terms and conditions from the offer that was initially rejected by the large electrical corporation, the property insurer has first made an offer on those new terms and conditions to the large electrical corporation pursuant to paragraph (1), and the large electrical corporation has rejected that offer.

(5)An agreement for the sale, assignment, or transfer of the right described in this subdivision between a property insurer and a third-party entity that fails to conform to the requirements

of this subdivision shall be void and unenforceable.

(c)(1) Any agreement and exchange of information, including the offers made or documentation or other evidence submitted for purposes of reviewing, approving, or denying offers and any acceptance or rejection of an offer made to or by a large electrical corporation, pursuant to subdivision (b) shall be subject to a nondisclosure agreement and shall not be disclosed unless any of the following applies:

(A) Disclosure shall be made to the administrator or a public agency to the extent required by law. Information disclosed pursuant to this subparagraph is not a public writing and shall not be subject to public disclosure pursuant to the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) or any other law.

(B) For a property insurer, disclosure to a third-party insurer or reinsurer that is a party to a contract with the property insurer related to the right if the person or entity to whom disclosure is made agrees to the same nondisclosure terms.

(C) Internal disclosure as necessary for internal business purposes, including, but not limited to, underwriting if the person or entity to whom disclosure is made agrees to the same nondisclosure terms.

(2)Any agreement and exchange of information, including an offer made or documentation or other evidence submitted for purposes of reviewing, approving, or denying offers and any acceptance or rejection of an offer made to an electrical corporation, pursuant to subdivision (b) shall not be admissible, and shall not be used, subject to discovery or compulsion, in any proceeding,

including civil litigation, except for a judicial or administrative proceeding involving either of the following:

(A)An action to enforce the agreement following a breach of the agreement between the large electrical corporation and the property insurer entered into pursuant to this section.

(B)A violation of this section.

(d)An agreement between a property insurer and a third party entity shall not provide for financial participation by the third-party entity in an agreement entered into between the property insurer and a large electrical corporation pursuant to subdivision (b).

(e)A nondisclosure agreement between a property insurer and a third-party entity prohibiting the disclosure of the terms and conditions of an offer for an agreement subject

to this section shall not prohibit the disclosure of those terms and conditions to the large electrical corporation as required pursuant to paragraph (1) of subdivision (b). A large electrical corporation to which those terms and conditions are disclosed shall not disclose that information to any third-party that is not subject to the nondisclosure agreement.

(f)This section does not apply to a California domestic insurer if its annual property line direct written premiums are less than three hundred million dollars ($300,000,000).