Newsom proposes – Gov. Gavin Newsom will propose a new $100-million fund to help California wildfire victims rebuild by covering loan-loss guarantees for lenders and helping homeowners buy down interest rates during construction. The plan is set to be part of the 2026-27 budget
SACRAMENTO — Gov. Gavin Newsom is preparing to put a new $100-million proposal on the table to help California wildfire victims rebuild, aiming to bridge a painful gap between what insurers pay and what it costs to start over.
Newsom’s administration will send the revised budget plan to lawmakers on Thursday. with the fund designed to make construction loans easier to obtain for people who may otherwise be shut out or offered only high-interest terms.. In a statement, Newsom said his team has been “on the ground in L.A.. since Day One of recovery from these fires. ” adding that the state is not “turning our backs now.” He said. “This community deserves continued support to help them get back on their feet. and rebuild their homes and their lives.“
The administration’s concept is built around two related pieces: a loan-loss guarantee and help with interest costs.. Under the plan. the state would commit to covering a percentage of a loan amount if a borrower defaults. reducing the risk for lenders and encouraging them to offer construction financing.. Newsom’s office also said the money would be available for homeowners to buy down their interest rates during the construction period.
The stakes are personal and immediate for communities hit by the Eaton and Palisades fires. Those fires killed 31 people and destroyed over 16,000 structures in January 2025.
A survey of wildfire victims. cited by Newsom’s office. found homeowners estimate they need more than $600. 000 on average above their insurance payouts to rebuild.. In Altadena, the gap was about $550,000.. In Pacific Palisades and Malibu, homeowners estimated shortfalls ranging from $1.19 million to $1.73 million.
The proposal also arrives after the state has already moved to offer mortgage relief.. Under Newsom. California provided mortgage relief to more than a thousand wildfire survivors through CalAssist. a program that provides grants to eligible homeowners to cover mortgage payments for 12 months up to $100. 000.
The sequence of the governor’s approach is striking: the administration points to a lack of access to affordable loans and a mismatch between insurance payouts and rebuilding costs. then lays out a fund that is meant to make construction lending less risky and reduce interest costs during the building process.. The gaps cited—from about $550. 000 in Altadena to $1.19 million to $1.73 million in Pacific Palisades and Malibu—appear intended to show why loan access and pricing are central to the recovery effort described by the administration.
Newsom’s new proposal will be folded into the funding plan for California’s upcoming 2026-27 budget year. which begins July 1.. State revenue from income tax collection is described as higher than initially forecast. a shift expected to wipe out a projected deficit in the year ahead.. Analysts attributed the increase to an artificial intelligence boom in the stock market. and while it’s expected to be temporary. the additional funding is projected to give Newsom enough cushion to balance the state budget without major cuts and reduce a projected shortfall in 2027-28.
Before any money can be released, the fund would need backing from both houses of the California Legislature.. It would move forward as a trailer bill accompanying the state budget.. The funding would be available to disaster survivors, though eligibility details are expected to be determined during the legislative process.
Gavin Newsom California wildfires wildfire recovery rebuilding loans $100 million fund loan-loss guarantee CalAssist 2026-27 budget Altadena Pacific Palisades Malibu