Newsom blames slow LA fire recovery on tariffs and deportations

One Year Later, Barely a Dozen Homes Rebuilt

One year after the deadliest wildfires in Los Angeles history, the rebuilding process is crawling along. Governor Gavin Newsom is pointing fingers at Washington.

In a January 2026 interview, he blamed two Trump administration policies for the delay: mass deportations that have gutted the construction workforce, and tariffs that have sent building material costs through the roof.

Meanwhile, thousands of families are still living in temporary housing, waiting for permits, fighting with insurance companies, and wondering if they will ever go home.

The numbers tell a brutal story, and the politics behind them are just as messy.

The Fires Killed 31 and Destroyed 16,000 Structures

On January 7, 2025, two massive wildfires erupted in Los Angeles County.

The Palisades Fire ripped through Pacific Palisades and Malibu. The Eaton Fire tore through Altadena near Pasadena.

Hurricane-force Santa Ana winds pushed flames through neighborhoods so fast that firefighters ran out of water.

By the time both fires were contained on January 31, they had killed 31 people and destroyed more than 16,000 structures.

Fewer Than 12 Homes Have Been Rebuilt

One year later, the burn zones remain mostly empty lots. Fewer than a dozen homes have been fully rebuilt across Pacific Palisades and Altadena combined.

Ted Koerner of Altadena became one of the first to finish in late 2025, but only after liquidating 80% of his retirement savings.

More than 70% of displaced families have not started rebuilding. Streets are dark at night with few streetlamps replaced.

Even homes that survived the flames sit empty because owners cannot afford to clean out toxic contaminants.

Newsom Points to Immigration Crackdowns

In his January 2026 interview, Newsom said immigration enforcement has hit the construction industry hard.

He noted that up to 41% of California’s construction workforce are immigrants, with a significant portion undocumented.

Throughout 2025, ICE agents conducted raids at Home Depot parking lots, construction sites, and businesses across Southern California.

Workers, both documented and undocumented, stayed home out of fear. Newsom called it a direct labor shortage that is slowing every phase of recovery.

41% of California Builders Are Foreign-Born

The numbers back up the concern. Studies show that about 1.1 million foreign-born workers make up California’s construction workforce.

Nationwide, roughly half of immigrant construction workers are undocumented.

A 2025 survey by the Associated General Contractors found that 28% of firms reported losing workers due to actual or rumored ICE raids.

Some Latino-owned construction companies have removed business signs from their trucks to avoid being targeted.

Crews are showing up short-handed, and projects are falling behind.

ICE Raids Hit LA Hard in 2025

The Trump administration made workplace enforcement a priority.

In June 2025, ICE agents raided Home Depot parking lots in the Los Angeles area, targeting day laborers looking for work.

In one incident, a Guatemalan migrant fled across a freeway and was struck and killed. Raids also hit garment factories, car washes, and restaurants.

By September, the Department of Homeland Security reported that ICE had deported 400,000 people since Trump took office, with an estimated 1.6 million self-deporting.

The fear spread well beyond the undocumented.

Tariffs on Lumber Now Exceed 45%

Newsom also blamed tariffs on Canadian building materials. More than 70% of the lumber used in American homebuilding comes from Canada.

Under Trump, Canadian softwood lumber now faces combined anti-dumping, countervailing, and national security tariffs exceeding 45%. In October 2025, Trump added another 10% duty on timber and 25% on kitchen cabinets.

The National Association of Home Builders estimates these tariffs add about $9,200 to the cost of each new home.

For fire victims already stretched thin, that is money they do not have.

Federal Aid Package Still Not Sent to Congress

California requested $33.9 billion in federal disaster aid. Nearly a year later, the Trump administration has not submitted a funding proposal to Congress.

About $5.7 billion in existing FEMA and Small Business Administration funds have flowed to survivors, but long-term recovery money requires congressional action.

In December 2025, Newsom traveled to Washington to press lawmakers.

He met with senators from both parties but said administration officials refused to even send a staffer to discuss the issue.

Insurance Gaps Leave Families Stuck

Even homeowners with insurance are struggling.

By December 2025, less than 20% of fire victims with total home loss had closed out their insurance claims.

Many are finding their policies fall hundreds of thousands of dollars short of actual rebuilding costs, which can easily exceed $1 million.

About one-third of insured victims had coverage through State Farm or the California FAIR Plan.

Both have faced complaints over lowball estimates and burdensome requirements. Los Angeles County opened a civil investigation into State Farm’s practices in November.

Permits Are Moving Faster Than After Paradise

State officials point to one bright spot: permitting has moved faster than after previous disasters. About 2,600 rebuilding permits have been issued, with another 3,500 in review.

Officials say that is three times the pace of one year after the 2018 Camp Fire, which destroyed the town of Paradise.

The state waived fees, suspended certain building codes, and created pre-approved home designs to speed things along.

Los Angeles County also launched an AI tool to help review plans. But permits are only the first step.

Over 600 Families Have Sold and Left

Not everyone is waiting to rebuild. More than 600 properties where homes were destroyed have already sold.

Some owners took cash offers from developers. Others simply gave up after facing insurance battles, permit delays, and rising costs.

A UCLA study found that as of August 2025, seven in ten Altadena homeowners whose property was destroyed had not started taking steps to rebuild or sell.

Among those who had done nothing, Black homeowners were 73% more likely to remain in limbo.

First Rebuilt Homes Bring Some Hope

In early December 2025, Ted Koerner and his golden retriever Daisy Mae moved into their new Altadena home. A few days later, the Dyson family received their certificate of occupancy in West Altadena.

Thomas James Homes completed the first rebuild in Pacific Palisades. These milestones came nearly a year after the fires.

Developers say they expect a flood of permit applications in 2026, with some companies promising to have more than 100 homes under construction by year’s end.

The timeline for most families, though, stretches much further.

Recovery Will Take Years, Not Months

Newsom called the situation a direct result of federal policy. Trump’s team has not responded to specific questions about how deportations affect rebuilding.

A White House spokesperson said there is no shortage of American workers. But fire victims are not waiting for Washington to sort it out.

Some are draining retirement accounts. Others are piecing together loans and charity donations. Many are still sleeping in RVs parked on empty lots where their homes once stood. The fires lasted three weeks.

The recovery will take years.

This article was created with AI assistance and human editing.

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