A house built of cards will crumble

On Jan. 29, 2026, fire victims in the Palisades and Altadena who had applied for federal Small Business Administration (SBA) rebuilding loans received an email from the SBA titled, "New Option to Accelerate Rebuilding Thanks to President Trump."

President Trump's Jan. 27 "California Wildfires" executive order

The SBA Jan. 29, email came on the heels of President Trump's Jan. 27 Wildfires Executive Order 14377,  "Addressing State and Local Failures to Rebuild Los Angeles After Wildfire Disasters." The executive order called on particular federal agencies, specifically the Secretary of Homeland Security (DHS), through Federal Emergency Management Agency (FEMA), and the SBA, to consider promulgating regulations that "preempt state or local permitting processes and other similar pre-approval requirements," and replace them with a federal self-certification process. The order recommended that new, proposed rules issued by Feb. 26 and that final regulations be promulgated by April 27. The federal regulations would be a mechanism "to advance the policies" of the president's wildfires executive order.

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In the order, the president singled out, by name, California state and Los Angeles local officials for failing (i)"to contain wildfires," (ii) "to engage in responsible forest management," (iii)"to maintain water distribution and reservoir systems," (iv)"to quickly communicate evacuation warnings" and failing to (v) not "act decisively or cohesively" to contain the spreading fires. Los Angeles Mayor Karen Bass was chastised by the president for "traveling abroad" during the fires. The Biden Administration was also blamed too for making "big promises" (after the Jan. 7, 2025 fires) concerning debris removal. The order asserted that debris removal did not begin in earnest until after President Trump took office on Jan. 20, 2025 (13 days later).

Additionally, the executive order alleged that the federal government had "approved numerous" fire victim relief claims (from both homeowners and businesses), but that the victims were unable to access federal funds as a result of burdensome local and state building requirements.

The SBA's Jan. 29 email to Palisades & Altadena fire victims

The Jan. 27 executive order was discussed in the SBA's Jan. 29 email to fire victims who had applied for SBA (federal) rebuilding funds. In addition to lauding the president for his commitment to "accelerating rebuilding" in California, the SBA described its own, new powers vis-à-vis California's state and local authorities as follows:

"President Donald J. Trump has empowered the SBA to implement new regulations through a new executive order," which allow "SBA disaster borrowers to bypass certain state and local permitting requirements if the borrower has been unable to obtain requisite approvals after an extended period of time."

The SBA email also stated that if the fire victim had applied for a rebuilding permit and the permit had not been acted upon withing 60 days of submission, then the victim (and the victim's builder-contractor) could self-certify that "applicable building codes, safety measures and other substantive requirements" have been followed, and build.  

The SBA's self-certification forms are not a result of any administratively promulgated regulations

No administrative regulations have been promulgated or are in the works, which would arguably be the first step in any SBA attempt to supersede local and state building and zoning regulations. In fact, on Jan. 29 (the same day as the SBA email), the SBA issued something called "regulatory guidance" related to Pres. Trump's EO 14377 (incorrectly referred to in the guidance statement as a non-existent EO 14277) (emphasis added). The regulatory guidance statement is entitled, "Options to Bypass Permitting Delays." The guidance statement directs the reader to fill-in-the blank federal self-certification forms.

However, a regulatory guidance statement is not a promulgation of an administrative rule. Pursuant to the Administrative Procedures Act (APA), 5 U.S.C, Sec. 553, administrative rule-making requires formal notice published in the Federal Register with (among other things) reference to (i) the legal authority relied in support of the proposed rule, as well as (ii) a statement regarding the time, place and nature of the public rule making proceedings. Thereafter, as part of the administrative rule making process, the federal agency gives (iii) notice to "interested persons" to participate in the rule making process (iv) through "submission of written data, views, or arguments with or without opportunity for oral presentation."

The actions of the federal government in entreating California fire victims and their contractors to use federal self-certification forms is very "cart-before-the horse."  It has not been established that the identified federal agencies have the legal authority to create such forms or, in any way, that they have complied with the APA's requirements.

What do you as a lawyer tell your client, the fire victim and/or builder contractor?

Imagine that you represent a fire victim and/or a builder-contractor who received the SBA's "go self-certify" email. Suppose your client asks you whether they should self-certify and start rebuilding without following the established permitting processes of the locality, county, and the state.

What should you say? Quick answer: Don't do it. Or if you do it--don't rely on it. Self-certifying that you have complied with all laws does not mean that you are exempted from liability for not following the laws of the city, county and the state in which the building is to be constructed.

Tell your client that the federal government's avenue for "self-certification" implicates several constitutional issues. Translation? Neither the president or his agents have the constitutional authority to direct that a state's inhabitants skip or ignore state and local zoning requirements. There is no federal legislation or constitutional provision that vests in the president or the executive branch the ability to nullify California's zoning requirements. That "Trump officials vow to speed up permits for fire rebuilding" does not make it so and does not make it legal.

Loyola Law School professor Justin Levitt, an expert in constitutional law, said it best: "The president has no power to order agencies to preempt state and local law without congressional authorization - " ... nothing in the executive order would give . . .any comfort that [one can] ignore any local regulations without Congress acting first."

Bottom line: fire victims beware

Federally encouraged rebuilding "self-certifications" are not a magic bullet. Homeowners and contractors must still obey and follow state and local laws and abide by those practices. A federally self-certified structure is just a house of cards. Should the house fall in on someone, no federal self-certification will inoculate the homeowner or the contractor from liability.

An old adage (modified slightly) is apropos here. "Be wary of federal officials bearing gifts."