Insights
Publications

What California Wineries Need to Know Now to Prepare for Fire Season

April 28, 2021 Articles
North Bay Business Journal

California is at the start of another dry year, with increased likelihood that the North Bay will experience another active fire season.

Fires are always a risk and they are always unpredictable — preparing in advance can help prevent damage, mitigate loss, and reduce stress.

Protect your physical space

It is important that structures be built or retrofitted with fire-resistant building materials — this is often referred to as “hardening” a building.

It is also crucial to maintain 100 feet of defensible space around the whole perimeter of any building. These precautionary steps are best taken now when labor and building materials are easier to access and available at a lower price.

CalFire and Napa Firewise both have great resources on hardening buildings, creating defensible spaces, and general preparedness.

Make an evacuation plan

Every home and business should have a detailed plan that lists the steps to be taken to protect people and property in the event of an evacuation.

Take the time now to meet with your family members and employees and think through the different evacuation scenarios that could occur during the year. Make sure that all employees, including seasonal employees, are familiar with and can access the evacuation plan.

Some wineries find it helpful to develop an evacuation checklist for each of the main stages of production.

Consider updating insurance limits

Work with your insurance broker to review your policy limits and ensure they are sufficient to cover potential losses after a fire.

Following a wildfire or other natural disaster, construction costs can increase significantly due to heightened demand for materials and labor. This can mean that insurance limits that are adequate during normal times become insufficient to cover actual rebuilding costs.

Also, keep in mind that building costs rise every year and the limits you negotiated when you bought a property may no longer be sufficient. If necessary, increase your insurance limits now.

Understand the process for making an insurance claim

For vineyard owners, it is crucial to review your crop insurance policy in advance of a potential natural disaster and understand the process for making a claim.

Some crop insurance policies require that a grower submit initial information about a potential claim shortly after the event that gives rise to the claim (in many cases, 72 hours).

This requirement can be overlooked because smoke taint is often not detectable until the grapes have been made into wine, so the grower does not know there is a loss.

In the event of a fire, be sure to timely file any paperwork necessary to preserve a claim — it is always possible to drop the claim if it turns out the fruit was not actually damaged.

It is also important to review your insurance policies to determine what supporting materials you need to file a claim.

For smoke taint claims, for example, policies often require information regarding the location of the grapes, when they were affected, and for how long.

Many insurance companies also require lab tests to confirm the presence of smoke taint and some will only accept results from preapproved labs.

If the grapes are crushed, some policies require that juice from different lots be segregated and will not cover affected juice if it is mixed. Generally, it is advisable to keep track of blends, additions, and any measures taken to reduce the possible effects of smoke taint.

Review your grape purchase contracts

Whether you are a grower or winery, it is critical to understand what your grape purchase agreements say about accepting and rejecting fruit, who makes that determination, and what supporting evidence is required.

If you have the opportunity, you should consider amending existing agreements to clarify the process — clarity benefits both parties.

You should also be mindful of these issues when negotiating new agreements. Similar concerns apply to vineyard leases where rent is determined based on harvested tonnage.

Develop a plan for working through the smoke

Before fire season starts, develop a staffing plan that accounts for employment issues related to fires. OSHA and other regulations governing employee well being apply to employees who need to work in very smoky or otherwise hazardous conditions, including obligations to provide PPE. Employees with health conditions may also be able to request accommodations.

In addition to employment law requirements, you could encounter logistical obstacles such as power outages, evacuation orders, and road closures.

If you have a generator, ensure it works and that you have any required permits and sufficient fuel.

If you do not have a generator, consider buying or renting one.

Also, understand the process for obtaining access permits in a mandatory evacuation zone. Although it is impossible to plan for everything, developing a staffing and operational plan now with these contingencies in mind will better position you for a smooth continuation of operations.

Firm Highlights

News

Farella Represents Far Niente Winery in its Acquisition of Provenance Vineyards

Northern California legal powerhouse Farella Braun + Martel represented Napa Valley luxury wine producer Far Niente Family of Wineries & Vineyards in its acquisition of the Provenance Vineyards real estate in Rutherford, Calif. from Treasury...

Read More
Publication

Fire Season Preparedness: What Wineries Should Do Now - Video

Farella's Quinn Arntsen and MaryJo Lopez with guest speaker Christopher Thompson of Napa Communities Firewise Foundation discuss "Fire Season Preparedness: What Wineries Should Do Now." California is at the start of another dry year...

Read More
News

Ashley Breakfield Appointed to 2022 CREW SF Board of Directors

Ashely Breakfield Headshot
Read More
Publication

California’s Approach to Eviction Moratoriums

The COVID-19 pandemic has resulted in a variety of eviction moratoriums enacted by local, state, and federal governments in the United States. The California state moratorium was recently extended and modified, giving residential landlords...

Read More
Publication

How Changes to California’s Fire Regulations Could Affect North Coast Housing Projects

Both the Board of Forestry and the State Senate are considering changes to state fire regulations that would affect real estate development in California. The first set of changes can be found in the...

Read More
News

Farella Welcomes Christopher Rendall-Jackson to Energy + Infrastructure and Real Estate Industry Groups

Headshot of Chris Rendall-Jackson
Read More
News

Tony Schoenberg Appointed to Bar Association of San Francisco Board of Directors

Anthony P. Schoenberg headshot
Read More
Publication

Eviction Moratoriums and Commercial Leasing: Current Issues

Farella's Tony Schoenberg and Jonah Trotz with guest speakers Marsha Ramsey and Margaret Duskin of Cushman & Wakefield discuss "Eviction Moratoriums and Commercial Leasing: Current Issues." The pandemic has had wide ranging impacts on...

Read More
Publication

Returning to the Office: Legal and Practical Considerations for Keeping Your Team Safe

Farella's Ashley Breakfield (moderator) and Holly Sutton, along with guest speaker Tom Cashin from Shorenstein, discuss “Returning to the Office: Legal and Practical Considerations for Keeping Your Team Safe.” COVID-19 shelter-in-place mandates caused employers to close their...

Read More
Event

Bisnow: East Bay Boom!

Brent Saldaña will moderate Bisnow's “East Bay Boom!” What You'll Learn: The East Bay has emerged as a growing life science cluster. How are owners and developers capitalizing on increased investment in the market and sector...

Read More