On Sunday, Governor Gavin Newsom signed significant legislative measures aimed at regulating industrial companies in California. This action follows the aftermath of a massive fire at a cold storage facility located in Los Angeles’ Boyle Heights neighborhood, which occurred in June.
Business organizations and some Republican lawmakers have expressed opposition to these new rules, arguing that they might increase operational costs for companies, eventually impacting consumers with higher prices.
Impact of the Fire
The June 17 fire took place at Lineage’s 500,000-square-foot food warehouse. This incident left local residents grappling with harmful smoke and an infestation of rats and flies.
Details of the Bills
Senate Bill 716, authored by Senator María Elena Durazo (D-Los Angeles), significantly increases the fines that local agencies can impose on companies posing health and safety threats. The new legislation allows fines of up to $50,000 per violation, compared to the previous amounts, which were limited to a few hundred or thousand dollars.
There are exemptions within the law for institutional and educational organizations.
Assembly Bill 817, introduced by Assemblymember Mark González (D-Los Angeles), mandates that no building permit for a cold storage facility will be approved unless the facility’s owner or operator establishes a contingency fund or secures insurance to address any emergency needs of local residents.
While both laws initially apply locally, they are set to be implemented statewide starting July 1, 2028.
Reactions and Future Implications
Lineage has not provided any comments regarding the new legislation. However, Greg Lehmkuhl, president and chief executive officer of Lineage, previously mentioned in an earnings call that the company allocated $3.3 million to support the community following the fire.
Governor Newsom highlighted the importance of these measures in his statement, explaining, “The fire revealed the lasting impact a major facility emergency can have on a community. These laws enhance the tools, resources, and accountability necessary to protect residents and assist communities in emergency situations.”