North Bay fire survivors criticize trust devoted to PG&E payouts amid revelations over 2020 spending
Some Sonoma County fire survivors expressed outrage Thursday over a report that the $13.5 billion trust created to compensate them for losses in the 2017 wildfires fell far short of expectations in its first year of operation.
The Fire Victim Trust tasked with compensating survivors spent $51 million — nearly 90% of its expenditures — on overhead last year, while just $7 million was disbursed to victims, KQED reported Thursday.
“It’s very disconcerting, it’s very disappointing,” said Jeff Okrepkie, who lost his Coffey Park home in the Tubbs fire. “A lot of us lost everything.”
But another survivor, Santa Rosa attorney Roy Miller, who is handling thousands of fire loss claims, said the trust’s startup costs were appropriate for such a massive settlement process.
Miller said the trust’s claims administrator Kathi Yanni sent him a statement last week reporting that more than 9,000 claimants had received $195 million in payments as of April 30.
“It paints a far more updated picture than the KQED article,” he said.
The $7 million paid out last year amounted to less than 0.1% of the money promised to survivors, KQED said in its report based on federal bankruptcy court filings, court transcripts and correspondence between trust staff and victims.
The bulk of the trust’s operating expenses so far occurred last year, while the claims payments largely began in March.
“It’s especially troubling when there’s a lack of transparency in the trust administration,” said Will Abrams of Santa Rosa, a fire survivor who has closely followed the PG&E bankruptcy case.
“Victims are trying to rebuild their homes and their lives,” he said.
The trust was created to manage the $13.5 billion that PG&E agreed to pay for losses people sustained from the 2017 North Bay fires and two fires in Butte County, one in 2015 and the Camp fire that virtually destroyed Paradise in 2018.
The 2017 fires burned more than 245,000 acres and killed at least 44 people from Sonoma County to the Sierra Nevada foothills. More than 5,330 homes were destroyed in Sonoma County.
“We’re sitting here having no answers,” said Okrepkie, a board member of the Coffey Strong, a neighborhood organization formed after the Tubbs fire.
Okrepkie said he was told in calls to the trust that officials were unable to provide an update on his family’s claim.
The trust pays only for uninsured losses, and Okrepkie said many underinsured homeowners were counting on a payment that would enable them to “build back what they lost.”
Miller, who is handling about 3,000 North Bay claims, said the startup costs for the fund — which is processing claims from more than 70,000 victims — are “not out of line” with expenses for large bankruptcy trusts.
“These things cost money,” he said, acknowledging the years victims have been waiting for payments.
“I’m no fan of how long this has taken,” said Miller, whose Wikiup home was destroyed by the Tubbs fire. ”Everyone wants to be paid. I haven’t been paid.“
In the April 30 statement cited by Miller, the trust showed it had paid 9,674 claimants a total of $195.2 million.
Representatives for the trust declined to speak to KQED for its investigation, and the trust did not immediately respond to The Press Democrat’s request for comment Thursday.
The trust reported spending $38.7 million on financial professionals, claims administrators, consultants and other operating expenses between July 1 and the end of 2020, according to an annual report filed in bankruptcy court last week by John Trotter, a former judge who oversees the trust.
The trust took in an additional $12.7 million in funding from PG&E last spring to set up the claims process, KQED reported.
In a letter posted on the trust website, Trotter said the trust — created and funded in July 2020 — hired a law firm that assigned about 300 staffers, including attorneys, project managers, analysts, claim reviewers and software developers to the project.
Trotter, a retired California Appeals Court judge, charges $1,500 an hour and claims administrator Cathy Yanni bills $1,250 an hour, KQED reported.
About 27 million pages of materials have been received by the claims administrator, Trotter said. The trust statement this week noted there are more than 248,000 distinct claims involved.
“Understandably, you have suffered with the devastating effects of these disasters for many years and are anxious to receive a recovery after so much time has already passed,” Trotter said, adding that the process “is actually much more efficient when compared to the court system.”
State Sen. Bill Dodd, D-Napa, a legislative leader on wildfire issues, said the KQED report was “very discouraging” given the imbalance between overhead costs and claims payments.
“People are hurting,” he said. “Hopefully what we’ll see this year are far less (spending) for expenses and far more payments.”
The state has no authority over a federal bankruptcy court process, Dodd said.
You can reach Staff Writer Guy Kovner at 707-521-5457 or firstname.lastname@example.org. On Twitter @guykovner.