Tips for Contractors Who Want to Help Rebuild After the California Wildfires

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I received a call from one of my contractor clients this past week to see what he could do to help those affected by California’s North Bay fires.

The North Bay fires are the deadliest and most destructive wildfires in California’s history. To date, the fires have claimed 42 lives, burned more than 200,000 acres of land, destroyed an estimated 8,400 structures and likely damaged tens of thousands more. By comparison, the state’s second most deadly wildfire, the Oakland Hills fire of 1991, claimed the lives of 25 people, burned 1,600 acres of land, and destroyed 2,900 structures. Rebuilding costs for the North Bay fires, according to the California Insurance Commissioner, are expected to top $1 billion.

For those with insurance, insurance experts say that the rebuilding process can take two years or more for those whose homes and businesses were destroyed. For those whose homes and businesses were fortunate enough only to be damaged, rebuilding efforts are already underway.

While I’m not aware at this time of organizations through which contractors can help those impacted by the fires, for contractors who want to help, a few reminders:

• Statutory Home Improvement Contracts – 7-Day Right to Cancel Notice: Contractors who repair, remodel, alter, convert, modernize, or add to a residential property – regardless of the number of residence or dwelling units – are required to use a statutory home improvement contract. Most residential contractors are already aware of this. However, because Governor Brown has declared a state of emergency in Mendocino, Napa, Sonoma, Yuba counties, the typical three-day right to cancel notice should be replaced with a seven-day right to cancel notice pursuant to Business and Professions Code section 7159 which provides:

The following notice entitled “Seven-Day Right to Cancel” shall be provided to the buyer for any contract that is written for the repair or restoration of residential premises damaged by any sudden or catastrophic event for which a state of emergency has been declared by the President of the United States or the Governor, or for which a local emergency has been declared by the executive officer or governing body of any city, county, or city and county: . . .

• Price Gouging: It is illegal to price-gouge during emergencies. Penal Code section 396 provides that upon the proclamation of a state of emergency declared by the President of the United States or the Governor, or upon the declaration of a local emergency by an official, board, or other governing body vested with authority to make such a declaration in any county, city, or city and county, and for a period of 180 days following that proclamation or declaration:

[I]t is unlawful for a contractor to sell or offer to sell any repair or reconstruction services or any services used in emergency cleanup for a price of more than 10 percent above the price charged by that person for those services immediately prior to the proclamation or declaration of emergency.

However, a greater price increase is not unlawful if that person can prove that: (1) the increase in price was directly attributable to additional costs imposed on it by the supplier of the goods; or (2) directly attributable to additional costs for labor or materials used to provide the services, provided that in those situations where the increase in price is attributable to the additional costs imposed by the contractor’s supplier or additional costs of providing the service during the state of emergency or local emergency, the price represents no more than ten percent (10%) above the total of the cost to the contractor plus the markup customarily applied by the contractor for that good or service in the usual course of business immediately prior to the onset of the state of emergency or local emergency.

• Register Under FEMA’s SAM Program: The Federal Emergency Management Agency (“FEMA”) maintains a System for Award Management (SAM) database of vendors, including construction contractors, who wish to be included in the Disaster Response Registry used by FEMA and the U.S. Army Corp of Engineers to provide disaster-response assistance through federal procurement opportunities.

Of course, before beginning any construction you should take care to get proper permits including, as it relates to the fires, for debris cleanup. The County of Sonoma has put together a webpage with helpful advice on debris removal.

You may also want to have handy a copy of your California Contractor’s State License Board wall certificate and/or pocket card because, while disasters often bring out the best in humanity, it also brings out the worst as well, including phony contractors who try to take advantage of traumatized victims.

And, finally, because many laws governing construction are local, make sure you comply with all local laws related to construction.

Be careful out there.