After Lineage fire, new California laws target cold-storage warehouses

California Gov. Gavin Newsom has signed legislation that will require some cold-storage operators to establish emergency financial resources for affected communities and allow local governments to impose substantially higher penalties for health and safety violations.

The measures, Assembly Bill 817 and Senate Bill 716, follo the June 17 fire at a nearly 500,000-square-foot Lineage cold-storage warehouse in Los Angeles. The blaze burned for eight days, triggering a state emergency declaration and a prolonged cleanup effort amid public-health concerns in surrounding neighborhoods.

AB 817, authored by Assembly member Mark González (D-Los Angeles), makes a contingency fund or insurance coverage for specified community emergency needs a condition of approval for building permits covering certain large cold-storage facilities.

The law is designed to ensure that resources are available for residents when a cold-storage emergency disrupts a neighborhood. Industry opposition groups said the measure could impose new financial obligations on cold-chain companies and ultimately raise costs through the food and pharmaceutical supply chain.

The Global Cold Chain Alliance said cities and counties could set required contingency funds from zero to $20 million as a permit condition. SB 716, sponsored by Sen. Maria Elena Durazo (D-Los Angeles), strengthens local enforcement authority for health and safety violations involving specified nonresidential buildings of at least 20,000 square feet.

For qualifying violations that lead to a governor-declared emergency or federal disaster declaration, fines may reach $50,000 per violation. The enhanced penalties will initially apply in Los Angeles County before expanding to qualifying areas statewide on July 1, 2028.

Current local penalties can amount to only hundreds or thousands of dollars, Durazo said, an amount she argued was insufficient to reflect the harm stemming from major industrial incidents. The Los Angeles Fire Department determined the fire originated on the roof at or near a 13,000-panel solar array and involved an electrical event.

However, because the precise electrical trigger could not be definitively proven, the official cause remains classified as undetermined. Lineage said its cleanup and remediation alone would exceed $100 million. That work included removing more than 89 million pounds of spoiled food, demolishing the damaged structure and disinfecting the site.

The bills are California Latino Legislative Caucus priorities and focus on the aftermath of the Lineage warehouse fire in the mostly Hispanic neighborhood, which led to smoke, cleanup challenges and concerns surrounding deteriorating food at the site. Lineage Chief Executive Greg Lehmkuhl said during an earnings call that the company had committed $3.

3 million to assist the community after the fire. “Boyle Heights showed us the lasting impact a major facility emergency can have on a community,” Newsom said in a statement. “These laws strengthen the tools, resources and accountability needed to protect residents and help communities respond when emergencies happen.”

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