- within Strategy and Insolvency/Bankruptcy/Re-Structuring topic(s)
California Governor Newsom yesterday issued an executive order that reserves the right to commandeer hotels and other similar facilities to serve as facilities for dealing with individuals affected with Covid-19.
Under the California Emergency Services Act (Ca. Gov. Code § 8550 et seq.), the Governor is authorized to commandeer or use any private property or personnel deemed necessary in the exercise of emergency powers during a state of war or state of emergency. The state must pay the reasonable value of the private property or personnel commandeered.
According to the executive order, the California Health and Human Services Agency and the Office of Emergency Services are supposed to identify and otherwise make available facilities that would serve as quarantine, isolation and treatment facilities for individuals suffering from Covid-19, or that have had high risk exposure and are thought to be in the incubation period. The order directs the State to try to reach a contract or agreement with the owner, and if necessary, exercise the power to commandeer the hotel, medical facility or other temporary facility if an agreement cannot be reached. The executive order is silent on the issue of "reasonable value" pursuant to the statute.
According to published reports, the State is currently using a vacant 120 room hotel in San Carlos as the first such site. The cruise ship passengers that docked in Oakland, California earlier this week and tested positive have been under quarantine by Federal officials at that hotel.
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