$3.3 million.
That’s how much May Sung estimates it’ll cost to rebuild her Pacific Palisades home.
With her two-bedroom house atop a hillside abutting the Pacific Ocean, she had what she considered a quaint dwelling since 2005.
She doesn’t know if she’ll rebuild it on the empty lot there now.
“Because of all the expenses with building on the hillsides, on the coast, I don’t know if I’m going to rebuild or not,” she said. “I may have to sell.”
More than a year after wildfires tore through Los Angeles, state lawmakers are weighing a new proposal that would give the powerful California Coastal Commission more oversight over homes destroyed by future natural disasters. New buyers would need approval from the commission to rebuild, a reversal from current state law that allows homes ruined by fires or other catastrophes to sidestep the controlling state agency.
Buyers today can rebuild homes without commission review as long as they are largely the same as before the disaster and are no more than 10% larger than the original home.
Gov. Gavin Newsom last year broadened these exemptions to include rebuilds that aren’t similar to their original design when he suspended the commission’s authority over rebuilding efforts in L.A. to speed up what so far has been a grueling slog for the city.
In Malibu and the Pacific Palisades, where many homes hug the Pacific Coast, dozens of parcels of land have been purchased by developers from owners who can’t afford to pay what could be millions of dollars to remake their houses from scratch.
More than 40% of homes sold in the Palisades last summer were bought by investors, according to real estate company Redfin, which defined investors as buyers with “LLC,” “Inc,” “Corp” or “Homes” in their names.
Some residents have questioned what expanses of investor-owned lots could mean for the character of fire-torn communities, said Sen. Ben Allen, who authored Senate Bill 1229 and represents the Palisades area.
The legislation is one of few bills this session that would broaden the authority of the commission rather than weaken it, bucking a trend of longstanding disdain among top state and federal leaders about how the agency has controlled development along California’s invaluable coastline.
The potential law would not apply to homes destroyed by last year’s fires.
Senate Democrats overwhelmingly supported the bill when it passed the chamber last month. San Francisco Sen. Scott Wiener was the sole Democrat to join Republicans in voting against it in a 29-9 vote.
“It could set a troubling precedent that we’re more focused on only empowering the original owner to build,” Wiener said. “I thought it was a very, very dangerous precedent and that’s why I felt the need to vote ‘no.’”
A long road ahead
Rebuilding after disaster has never been easy in California.
Fewer than 40% of homes destroyed in the state’s most destructive fires from 2017 to 2020 have been rebuilt, according to a 2025 Los Angeles Times investigation. Low insurance payouts, rising construction costs and permitting requirements are some of the reasons.
For many in L.A., the decision not to rebuild comes down to affordability and practicality, between skyrocketing mortgage rates and a lack of stamina to endure what could be a monthslong, byzantine permitting process.
Before the fire, Sung’s property was valued at $2.5 million. She said she received $700,000 in Mercury insurance payments after the home was destroyed on Jan. 7, 2025. Although her land isn’t up for sale, nearby lots go for around $1 million. She’s considering selling it to a developer.
“There’s already so much burden for these properties,” Sung said of rebuilds. “People can’t afford to build because of all these requirements,” such as the higher fire safety and fire codes common in wildfire-prone areas, she said.
A muddy reputation on housing
Critics, including Newsom, accuse the commission of not permitting enough affordable housing or doing so too slowly for years, as lawmakers have gutted numerous housing laws to make it easier to build more apartments quickly.
In the Palisades, where affordable housing was already scant, affordability critiques carried a sharper edge. Just a few hundred units in a town of roughly 28,000 were deemed affordable and local mandates post-fire to build more have become their own flashpoint, separate from the coastal commission.
The 12 voting-member commission is governed by the California Coastal Act, a 50-year-old statute created in the wake of the 1969 Santa Barbara oil spill to protect the coast and its natural habitats.
It is one of California’s most scrutinized state agencies, as federal and local officials have questioned how it has used its authority over nearly 900 miles of coastline to block certain projects, such as rejecting billionaire Elon Musk’s request to increase the number of Space X rocket launches off the Santa Barbara coast.
Newsom and other top Democrats appointed three pro-development officials to the commission last year to help get more housing approved along the coast.
Wealthy Los Angeles real estate developer Jaime Lee was appointed by Newsom last October to replace Effie Turnbull Sanders, an attorney lauded by environmentalists for championing environmental justice issues at the agency.
Last May, Democratic Assembly Speaker Robert Rivas selected Chris Lopez, a Monterey County supervisor, and Chula Vista Councilmember Jose Preciado to the commission, both of whom are seen as pro-development.
Newsom and President Donald Trump have found common cause in attacking the commission. The governor has publicly chided the agency and issued a sharply worded mandate when suspending its authority over rebuilding efforts in the Palisades.
“The scope of destruction of these fires has created a need for immediate shelter and temporary housing that will require unlocking every available strategy to house displaced individuals,” he wrote.
Both Democrats and Republicans in the state Legislature have pushed to curb the commission’s authority, including an attempt to exempt the entire city of Santa Monica from the commission’s purview.
Last week, Newsom’s office briefly considered a proposal that would have exempted mixed-use and multi-family housing projects along Santa Monica’s coast from the Coastal Act.
The proposal would have assumed all those projects complied with the act unless the commission could prove otherwise within just 30 days, according to a copy of the plan obtained by CalMatters.
Trump has also repeatedly scolded the commission for blocking projects it views as environmentally dangerous. Longstanding tensions between the president and the commission have accelerated in the president’s pursuit to extract more oil from the coast. Those tensions accelerated last week when the federal government announced it was investigating the agency.
‘People are already stuck’
Allen, the bill’s author, said the governor’s orders created an opening that investors can misuse to circumvent coastal rules and build projects harmful to the environment.
“We just want to make sure that we’re not rolling back these important protections too far,” Allen, who is running for insurance commissioner, said about his legislation, and that it would not apply to homes destroyed by last year’s fires, but to future natural disasters.
The bill aims to filter out investors by only allowing the owner of a property before disaster struck to skirt the coastal commission approval.
Environmentalists who support the bill have said the governor’s actions put key issues the commission works to protect — natural habitats and public access to the beach — in jeopardy by allowing developers to take advantage of fewer rules.
'An outside developer who buys, say, a burned lot for the low market value, they get the same fast-tracking as a displaced family.'
— Jennifer Savage of the Surfrider Foundation
"An outside developer who buys, say, a burned lot for the low market value, they get the same fast-tracking as a displaced family," said Jennifer Savage, associate policy director at Surfrider Foundation. “And that’s not what the law was designed for.”
The commission, which had briefly contested Newsom’s orders, supports the bill for similar reasons.
“It closes a loophole that could be misconstrued as allowing larger replacement structures to be located in hazardous or environmentally sensitive areas when rebuilding after disaster,” spokesperson Joshua Smith said in an emailed statement.
Neither the coastal commission nor Allen could provide examples of investor-owned projects that have misused the law.
“We don’t have any record or knowledge of this having happened, although since most disaster rebuilds are handled by local governments, we don’t know for certain the extent to which this has been going on,” Smith said.
California YIMBY, a pro-housing group, said legislation focused on rebuilding should address why so many fire survivors are opting to sell their land in the first place.
“I’m not sure the emphasis on the Coastal Act makes a ton of sense,” spokesperson Matthew Lewis said, saying the problem lies with insurance, construction and permitting costs that make it too expensive for most people to rebuild.
The group, which has endorsed Allen for commissioner, doesn’t have an official stance on the bill. Lewis said he doesn’t know enough about the issues Allen is trying to address to say if the legislation could make it harder for owners to rebuild.
Sung worries such changes would intimidate developers worried about falling under the commission’s authority, making it harder for her and her neighbors to sell.
“If anything, it just makes the landowner stuck. Because you can’t afford to sell, and you can’t afford to build. And so you’re stuck with this property that has absolutely no use to anybody.”
CalMatters reporter Yue Stella Yu contributed reporting.
This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.
