Nearly 13,000 homes were lost in the Palisades and Eaton fires. The permits, the payouts, and the lawsuits now tell a clearer story than the headlines do.
By Jose Navarro, MBA | The Navarro Report
LOS ANGELES. Nearly 21 months after the Palisades and Eaton fires destroyed roughly 7,000 and 6,000 structures respectively, the rebuilding story has moved from a question of grief to a question of arithmetic. By January, the city of Pacific Palisades had approved 3,090 building and electrical permits, but only 563 of those were new building permits, the figure that actually marks a house under construction rather than a demolition, a repair or an electrical upgrade. Mayor Karen Bass has cited roughly 1,300 rebuilding plans submitted citywide. Set against nearly 7,000 destroyed structures, the math is not encouraging, whichever number is used as the denominator.
The pace itself tells a story. Permits in the Palisades peaked at 495 in October, then fell to 356 in November and 373 in December, even as the city pledged to streamline the process. December applications dropped to 637, against a 2025 monthly average of 2,677, the lowest submission rate since January 2021. A process that was supposed to accelerate instead slowed just as the fires’ anniversary approached, which is the opposite of what any project manager would want to report to a board.
The bottleneck is not mysterious. Contractors and land use attorneys describe needing as many as 16 separate clearances from more than a dozen city departments for a single home, and a one stop permitting center that only functions when every department actually staffs it. The average wait time from application to permit issuance stood at 49 days as of early January, and 42 percent of December’s permits had been queued 49 days or longer. Governor Newsom and Mayor Bass have since rolled out expedited review for like for like rebuilds and a self certification pilot for simpler projects, along with pre approved architectural plans through the Foothill Catalog in Altadena, which officials say can cut costs by at least 10 percent. Those are real fixes. They have not yet reversed the trend line.
Money, not just paperwork, is the other half of the story. More than $4 billion in fire insurance claims had been distributed as of this spring, with insurers and the state’s FAIR Plan processing more to come. But a lawsuit filed in Los Angeles County Superior Court in April, on behalf of ten homeowners and seeking to represent thousands more, accuses the FAIR Plan of denying or underpaying smoke damage claims and, in some cases, directing policyholders to remediate smoke damage themselves using household cleaning methods rather than professional remediation. A second suit filed since makes a similar claim over a denied Eaton fire claim. Insured losses across both fires are estimated near $28 billion. A rebuild that depends on insurance proceeds arriving on time is only as fast as the claims process behind it, and that process is now also the subject of litigation.
None of this means the rebuild has failed. Compared with California’s five worst wildfires from 2017 to 2020, where fewer than 40 percent of more than 22,500 destroyed homes had been rebuilt by last year, the Palisades and Eaton pace, however slow it feels to residents, is faster than the state’s own recent history. That comparison offers little comfort to a homeowner still waiting on a permit or a claims check, but it is the right baseline for judging whether current reforms are working or merely looking busy. A controller comparing year over year performance would not accept the earlier fires as an excuse, only as context, and would still want to know why the newer, faster process is itself losing momentum into its second year.
A financial controller would ask three questions before calling this recovery on track. First, is the county and city reporting permit counts the way homeowners actually experience them, meaning new building permits that represent a house under construction, rather than a combined tally that includes demolition and repair permits and makes the pace look faster than it is. Second, what share of the $4 billion in distributed claims has gone to homeowners who have not yet broken ground, meaning the money arrived but the permitting system has not caught up to spend it. Third, what is the Department of Insurance doing, beyond litigation working its way through the courts, to resolve smoke damage disputes before the next fire season tests the FAIR Plan’s capacity again.
The fires are not a new story, almost two years on. What is new is that enough time has passed to separate a true rebuild from a pledge, and the numbers say the gap between the two remains wide. San Diego, which sits in its own wildfire corridor, should be watching the permitting fix as closely as the insurance fight, since one is coming and the other has already arrived.
Jose E. Navarro, MBA, is a financial controller and founder of The Navarro Report, a public finance and government accountability publication based in San Diego, California.
Human-Directed AI Journalism: This article was researched and drafted with AI assistance under the direction, review and editorial control of the author.