Faced with dueling proposals that could cost the city anywhere between $86 million to nearly $280 million, the Los Angeles City Council on Tuesday put off a final decision on waiving rebuilding fees for homes and businesses destroyed in January’s wildfires.
After a tense debate over how far the city should go in offering relief, the City Council sent the issue back to its Budget and Finance Committee for more analysis. The move leaves property owners affected by the Palisades fire in limbo while officials work to narrow a massive cost range and determine who should qualify for help.
For now, some fees remain temporarily suspended under a mayoral executive order — but without a permanent ordinance, homeowners and landlords rebuilding after the disaster still don’t know how much they will ultimately owe.
At the center of Tuesday’s debate were two competing plans.
The Budget and Finance Committee has recommended waiving building permit fees only for single-family homes and duplexes, and only for projects rebuilt up to 110% of their original size— the threshold used in the mayor’s emergency Executive Order No.1, which fast-track wildfire recovery permits. That option would cost the city at least $86 million, according to the City Administrative Officer (CAO).
By contrast, the Ad Hoc Committee for LA Recovery chaired by Councilmember Traci Park supports a far broader proposal. It would waive a wide range of fees for all structures damaged in the fire — including apartments, mobile homes, condos and commercial properties — with no cap on how much larger a replacement building could be. Updated CAO projections put the cost of that approach at up to $278.35 million, not including borrowing costs.
Park, who represents the Pacific Palisades, argued that the broader relief better reflects the mix of housing and small businesses destroyed when the Palisades fire swept through canyon neighborhoods and the Sunset Boulevard commercial corridor.
“Absolutely nothing about this rebuild is voluntary,” she said. “These aren’t people trying to rebuild for profit. They are trying to rebuild their lives.”
Many residents, she added, are “holding on by a thread,” paying mortgages on destroyed homes while also paying rent elsewhere. Limiting waivers to single-family homes, she said, “just repeats the same falsehood that somehow the Pacific Palisades is just an island of affluence,” noting the fire also destroyed rent-stabilized apartments, income restricted condos for seniors and mobile home parks.
But Councilmember Bob Blumenfield, who sits on the Budget and Finance Committee, said he was sympathetic but urged colleagues to stay realistic about what the city can afford.
“The fee-waiver concept is a tricky one, because there’s really no such thing,” he said. “It really just means the General Fund is paying those fees … at a time that we are really struggling financially.”
Other council members, including Tim McOsker and Katy Yaroslavsky, said they were uncomfortable voting without more precise numbers.
“This isn’t funny money, it’s not theoretical money,” said Yaroslavsky, who chairs the Budget and Finance Committee. “I would like to, before we vote on an amendment, understand what the fiscal implication of that is, at a moment when we are already after our first FSR (Financial Status Report), at least $80 million in the hole for this fiscal year.”
Park also introduced a “friendly amendment” urging colleagues to broaden eligibility if the Budget and Finance report advanced. Her proposal would set a sunset date of Jan. 7, 2030; extend fee waivers to ineligible Palisades property owners whose fees were already suspended; apply the “like-for-like” waiver to condos, townhomes, apartments and mobile homes, remove the 110% rebuild cap for single-family homes and duplexes.
Separately, Councilmembers Yaroslavsky and Monica Rodriguez proposed requiring any property owner who uses the fee waiver to reimburse the city if the property is sold within five years of construction.
Rather than adopt the amendments piecemeal, the City Council agreed — on a motion by Councilmember McOsker — to send the entire matter back to Budget and Finance for further analysis, including updated cost estimates and recommendations on how the program could be structured.