Santa Monica Developer Pushes for Palisades to Secede from LA

Faced with fire damage, frozen permits and a City Hall she says can’t scale, a Pacific Palisades developer has made a radical pitch a year after the destruction: break away from Los Angeles.

Santa Monica-based developer and reality TV alum Elaine Culotti is pushing for the Pacific Palisades to secede from the City of Los Angeles after losing roughly 20 percent of her real estate portfolio in the January fire, the Santa Monica Daily Press reported. Culotti argues the city’s disaster response exposed deeper structural failures that threaten property values, rebuilding timelines and insurability across fire-prone hillside neighborhoods.

In the days after the blaze, Culotti said state and local officials touted debris-clearing capacity that appeared robust until she realized the figures applied to all of California, not Los Angeles County or the Palisades specifically. As residents struggled through conflicting guidance and opaque timelines, Culotti said it became clear the city lacked the logistical capacity to handle a disaster of that scale.

Culotti’s, who starred on Discovery’s “Undercover Billionaire,” makes the call after she devised an alternative debris-removal strategy dubbed “Debris on Rail.” It would have moved fire waste from the Palisades, Malibu and Altadena via rail lines to a processing facility in Puente Hills. The plan, she said, was vetted with FEMA, the governor’s emergency services office and the Army Corps of Engineers and even pitched to federal appropriations staff in Washington. California ultimately declined to adopt it.

Culotti took the rejection as an indicator that the size of Los Angeles’ government has made it unwieldy to respond effectively to crises. She says the breakdown has direct consequences for real estate, from stalled permits and frozen valuations to mounting carrying costs for owners unable to rebuild, rent or sell damaged properties.

“How do you value real estate if you can’t sell it, rent it, repair it, or build on it? How do you keep paying mortgages, security, maintenance, brush clearing, insurance with no path forward?” she told the Daily Press. “No industry can survive like that. And no homeowner should be asked to.”

Her answer is municipal divorce. Culotti is advocating for the Palisades to become its own city, with local control over infrastructure, emergency response and rebuilding. She is also working to establish a community center to serve as a civic hub, though she claims even that effort has run into resistance from city agencies.

No major neighborhood has successfully seceded from an existing large city like Los Angeles in modern times. But nearby examples like West Hollywood, which incorporated in 1984, and Malibu, which followed in 1991, show how affluent, civically engaged communities have used cityhood to seize control of zoning, development and environmental rules. Those took years to organize, but ultimately reshaped local real estate outcomes for decades.

The secession push comes as wildfire risk, insurance pullbacks and rebuilding delays increasingly shape land values across Los Angeles’ hillside markets. That pressure has only intensified as the Los Angeles City Council has moved to forcibly clear the last uncleared Palisades fire lots nearly a year after the blaze as prolonged cleanup timelines stall rebuilding and prolong uncertainty for owners and lenders alike.

— Judah Duke