Cal Cities urges legislators to reform legal liability laws

By Johnnie Piña, legislative advocate, and Brian Hendershot, Cal Cities Advocate managing editor

Cal Cities and a coalition of local government, education, and joint powers authorities are urging the Legislature to enact meaningful reform for civil actions against public entities. The coalition’s proposed changes would protect survivors’ access to justice and ensure taxpayer dollars remain focused on the services Californians rely on every day. 

Forty cities from throughout the state have signed onto the coalition’s letter to lawmakers, along with dozens of school districts.

California’s cities, counties, schools, and special districts are facing an unprecedented surge in liability costs — a trend that threatens the stability of essential public services across the state. New data from the California Association of Joint Powers Authorities shows that public entity liability exposure has tripled in just seven years, now exceeding $7 billion, with costs projected to rise another 70% by 2027–28.

If these trends continue, public agencies throughout the state could face insolvency or be forced to cut essential services.

Civil litigation claims can take years to process — especially larger ones. It takes six years on average to close out claims over $1 million. These large claims make up less than 1% of all claims but represent 60% of all claim funds. It’s also common for private law firms to claim up to 50% of a taxpayer-funded settlement.

Other states — including Oregon, Colorado, Minnesota, and Maine — impose caps on such lawsuits. California already imposes reasonable limits in medical malpractice cases, recognizing the public’s interest in such restrictions.

How are claims against public entities funded?

Most cities cannot rely on traditional commercial insurance: It’s too costly, too limited, or simply unavailable. Instead, they self‑fund liability costs or pool risk through publicly funded joint powers authorities (JPAs). When a JPA pays a large claim, every member agency feels the impact through higher premiums, special assessments, or reduced coverage. As a result, even agencies with no claims are seeing steep, double‑digit premium increases.

Additionally, every self-funded claim — including those paid out of a JPA — comes from taxpayer-funded member contributions paid by cities, counties, schools, and other public agencies from the same general fund dollars that fund police, fire services, roads, and other essential services.

What Cal Cities and the coalition are asking for

Cal Cities is urging the Legislature to create:

• Defined benefits, including caps on damages in civil actions against public entities. This would ensure survivors and other injured parties receive financial compensation while preserving cities' capacity to deliver essential services.
• Proportional liability so that taxpayers pay only for the share of harm actually attributable to the public agency. This way, the perpetrators bear the cost of their own conduct and not taxpayers.
• Heightened evidentiary and procedural standards for claims where witnesses, records, and evidence archives are absent or insufficient to assign culpability.

Things are moving quickly in the Legislature, so if you are interested in joining the letter, please let us know as soon as possible. For more information or to join the coalition, contact your regional public affairs manager.