- California found PG&E responsible for the Camp Fire in November, which killed 85 people.
- The company expected this finding and filed for Chapter 11 bankruptcy protections in January, which allows them to function as a business while they rework their financial situation, and even halts ongoing lawsuits against them.
- Governor Gavin Newsom now wants to make sure the company is kept on a close watch by limiting the timeframes in which it can develop and restructure its finances.
PG&E Found Responsible
The California Department of Forestry and Fire Protection said Wednesday that their investigations found Pacific Gas and Electric responsible for starting the deadly Camp Fire.
The fire burned through Paradise, California in November, killing 85 people, burning over 150,000 acres, and destroying close to 19,000 structures. It is considered to be the worst wildfire in the state’s history.
Cal Fire sent out a news release saying that investigators were immediately dispatched to determine the cause and origin of the wildfire.
“After a very meticulous and thorough investigation,” the statement read, “CAL FIRE has determined that the Camp Fire was caused by electrical transmission lines owned and operated by Pacific Gas and Electricity (PG&E) located in the Pulga area.”
Cal Fire said it also identified a second ignition point where dry vegetation and electric wires also owned by PG&E started another fire that was later engulfed by the first.
Cal Fire did not release their full report, but it was forwarded to Butte County District Attorney’s Office. The Butte County D.A. could press criminal charges against PG&E, which is the largest electric utility in the state, servicing 16 million people.
On Wednesday, after the findings were reported, PG&E released a statement on their website paying tribute to the Camp Fire’s victims.
“Our hearts go out to those who have lost so much, and we remain focused on supporting them through the recovery and rebuilding process,” PG&E said in their statement. “We also want to thank the brave first responders who worked tirelessly to save lives, contain the Camp Fire and protect citizens and communities.”
The company also emphasized plans to work toward safer practices via their Community Wildfire Safety Program.
“We remain committed to working together with state agencies and local communities to make our customers and California safer,” they said.
Their program will include enhanced vegetation management practices, inspections of electric infrastructure, and building a more resilient electric system, among other things.
PG&E’s Bankruptcy Complications
PG&E was prepared to be found liable for the tragic fire. In January, the company filed for bankruptcy. PG&E said it anticipated close to $30 billion in damages from wildfires, including the Camp Fire, and other fires that raged through Northern California between 2017 and 2018.
In February, PG&E outlined their potential involvement in starting the Camp Fire in their annual earnings report. They stated that costs they might have to cover include property damage, business interruption, suppression costs, evacuation costs, medical expenses, personal injury damages, and punitive damages.
PG&E’s bankruptcy filing process has seen some bumps in the road. On Wednesday, California Governor Gavin Newsom requested that the judge overseeing their case strictly limit the time in which they can develop and bring forward its turnaround plan.
Gov. Newsom is one of many critics of PG&E, and how the company has handled their role in California’s wildfires. When PG&E filed for bankruptcy, they filed for Chapter 11 protections. This allows them to function as a business while they rework their financial situation. It also halts ongoing lawsuits. This decision sparked protests, with many saying this would only further hurt the victims of the fire.
In a court filing Wednesday, Newsom recommended to a judge that PG&E only be allowed to extend their exclusive filing period to August 15. Previously, the company had requested to bump the period from the end of May to the end of November.
“Allowing PG&E to continue a business-as-usual approach without any accountability would only encourage PG&E’s distressed-investors to leverage the Chapter 11 Cases to their benefit and to the detriment of existing and future wildfire victims,” Newsom’s attorneys said in the filing.
See what others are saying: (NPR) (Associated Press) (Wall Street Journal)
Billionaire Pledges to Pay Loan Debt of This Year’s Morehouse College Graduates
- Billionaire investor Robert F. Smith promised to pay off the student loan debt of the 2019 graduates at Morehouse College, an all-male historically black school in Atlanta, Georgia.
- Though the exact amount of the class’ debt is still being calculated, the gift is expected to be around $40 million.
- This is just one of Smith’s major donations in recent years.
A Generous Gift
Billionaire tech investor and philanthropist Robert F. Smith said he will pay off the student debt for all graduates in Morehouse College’s class of 2019.
Smith announced the news on Sunday while delivering the commencement address at the all-male historically black college in Atlanta, Georgia.
“On behalf of the eight generations of my family who have been in this country, we’re gonna put a little fuel in your bus,” he said. “This is my class, 2019. And my family is making a grant to eliminate their student loans.”
His announcement shocked the nearly 400 graduates, who reacted with cheers and applause.
One graduating student named Aaron Mitchom told the Associated Press that he had drawn up a spreadsheet to calculate how long it would take him to pay off his $200,000 in student debt. According to his math, it would take him about 25 years.
“I can delete that spreadsheet,” he told the AP after the commencement. “I don’t have to live off of peanut butter and jelly sandwiches. I was shocked. My heart dropped. We all cried. In the moment it was like a burden had been taken off.”
Brandon Manor, another graduate, told the New York Times, “Now all of a sudden, I can look at schools I might not have considered, because I am not applying with about $100,000 in undergraduate loans.”
Who is Robert F. Smith?
The 56-year-old who originally hails from Colorado but now lives in Austin went to Cornell for his undergraduate degree and earned a B.S. in chemical engineering. Afterward, Smith earned his MBA from Columbia Business School.
He went on to work for several companies like Kraft General Foods and then Goldman Sachs, advising companies like Apple and Microsoft before founding his own investment firm.
What does this gift mean?
Smith’s pledge stunned administrators, who called it the largest single gift in the school’s history. The donation also comes at a time where student loan debt has soared to roughly $1.5 trillion, according to recent Federal Reserve data.
Morehouse President David A. Thomas called the gesture “a liberation gift,” telling CNN, “When you have to service debt, the choices about what you can go do in the world are constrained.”
“(Smith’s gift) gives them the liberty to follow their dreams, their passions.”
According to Thomas, the total amount of student debt for the class is still being calculated but the Associated Press estimated that the gift is worth about $40 million.
In return, Smith says he expects the graduating class to pay it forward to give future classes the same opportunity one day.
“Let’s make sure every class has the same opportunity going forward, because we are enough to take care of our own community,” he said.
“We are enough to ensure we have all of the opportunities of the American dream, and we will show it to each other through our actions and through our words and through our deeds.”
Other Major Donations
The billionaire tech executive has managed to stay under the radar for much of his career. While this major donation has thrust him into the spotlight, it is far from his first generous gift.
In 2016, he pledged a $20 million gift to the National Museum of African American History and Culture. That same year, he donated $50 million to Cornell University to go towards its chemical and biomolecular engineering school, and to support black and female engineering students.
In 2017, Smith signed The Giving Pledge, a commitment by some of the world’s richest people – including Bill and Melinda Gates and Warren Buffet – who have promises to giving most of their wealth to philanthropy. In 2018, he gave $2.5 million to the Prostate Cancer Foundation to focus on research and care for African-American men and veterans with prostate cancer.
Before Sunday’s graduation speech, Smith had already donated $1.5 million to Morehouse for scholarships and a new park.
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