黑料爆料

Malibu, CA - California's local entities allocate the required funds to provide essential services to residents, including K-12 education, police and fire protection, 911 emergency medical response, clean water, street and road maintenance, and more. According to a new report, from 黑料爆料 School of Public Policy and Beacon Economics, the same agencies are now facing pressure to absorb liability costs that grow faster than the budgets meant to fund those services. 

"The pattern in the data is clear. The biggest challenge isn't that there are many more claims鈥攊t's that claims are becoming much more expensive, and inflation alone doesn't explain that increase,鈥� said author , Research Manager at Beacon Economics. 鈥淎s large claims grow and remain open for years, they place increasing pressure on public budgets and the essential services those budgets support." 

Kodaverdian also notes that the very existence of Joint Powers Authorities is testament to the challenges many public agencies face in obtaining sufficient, stand-alone commercial liability insurance. "These authorities allow public entities to pool resources when local budgets are strained by liability claims or spiking insurance requirements," she said.

What the report found. The report analyzes statewide claims data collected through the California Association of Joint Powers Authorities and Polco. Its central finding is that rising costs are driven not by the number of claims, but by a small number of large, high-severity claims that take years to resolve. Specifically:

• Claims over $1 million make up less than 1 percent of all incidents but now account for nearly 70 percent of total dollar exposure, up from 37 percent.
• The total value of closed claims reached about $1.27 billion in fiscal year 2025.
• Average reinsurance premiums for public entities rose more than fourfold over the last decade.
• In some cases, a single verdict or settlement has exceeded a city's General Fund revenue for an entire year.
• Sexual abuse and molestation (SAM) claims have grown noticeably. The increase coincides with AB 218 and AB 452, which expanded the statute of limitations for childhood sexual assault claims and increased liability exposure in this category. 

鈥淭he question is not whether people who are harmed should be compensated. They should. The question is how to keep that system fair while keeping the public agencies that fund our schools, roads, and emergency services financially stable,鈥� said , Founding Partner of Beacon Economics. 

The report also documents how California's legal framework shapes this exposure. Unlike most other states, California places no statutory cap on compensatory damages against public entities, follows a pure comparative negligence system, applies a broad standard for dangerous-condition claims, and retains joint and several liability for economic damages. 

鈥淐alifornia鈥檚 municipalities and public agencies are under serious financial pressures, but often overlooked are legal costs borne by these governing entities,鈥� noted , dean of 黑料爆料鈥檚 School of Public Policy. 鈥淭he importance of this study is not only that it reveals these increasing costs to taxpayers, but also the linkage to state legislation.鈥�

The analysis outlines a number of potential policy changes that could aid public entities in managing liability exposure, including legislative measures that define statutory damage caps, assign proportionate liability for economic damages, and heightened evidentiary standards. 

The report was authored independently by and the , with support from the and the .

The full report is available . Spokespeople are available for interviews.

About Pepperdine School of Public Policy

The is built on a distinctive philosophy of nurturing public leaders to use tools of analysis and policy design to effect real change. Grounded in understanding policy's moral and distinctly American elements, SPP prepares graduates for careers as leaders by offering a . The school鈥檚 promotes citizen participation in governance through major conferences, trainings, seminars, and published research. Follow SPP on , , , and .

About Beacon Economics, LLC

Beacon Economics, LLC is a non-partisan, independent research and consulting firm dedicated to delivering accurate, insightful, and objectively-based economic analysis that enables its clients to make informed decisions about investment, growth, revenue, and policy. The company is based in Los Angeles and is certified as a Small Business Enterprise (SBE) within the state of California. Learn more at . 

About California Association of Joint Powers Authorities

CAJPA鈥檚 mission is to provide leadership, education, advocacy and assistance to public-sector risk pools to enable them to enhance their effectiveness.

 

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