Business
Conditions May Have Stymied Black Hawk Crew Before Fatal Crash
Flying helicopters near Ronald Reagan National Airport always carries some risk. But the conditions on the moonless night of Jan. 29, when an Army Black Hawk helicopter and an American Airlines passenger jet collided, were unusually challenging.
Many of the factors that contributed to the disaster are still being uncovered as investigators from the National Transportation Safety Board try to reconstruct the collision that killed 67 people. The midair crash, which caused wreckage from both aircraft to tumble into the icy Potomac River below, was the nation’s deadliest aviation accident since 2009.
Investigators have said the helicopter was flying about 100 feet higher than authorized in its designated portion of the airspace and are trying to determine why.
But interviews with helicopter pilots suggest that the Black Hawk was also dealing with a set of complex flying conditions, some of which are typical for the bustling area around National Airport outside Washington and some of which were unique to the series of events that happened last Wednesday. And the crew was flying an older-model aircraft that lacked certain safety technologies in its cockpit that are commonplace in those of commercial airplanes in the United States.
“Given the complexity of everything going on there, it is a higher-risk place to fly,” said Austin Roth, a former Black Hawk instructor for the Army who says he often flew the helicopter routes near National Airport while in service.
N.T.S.B. safety investigators have not assessed any blame on the Black Hawk crew, which Defense Secretary Pete Hegseth described as “fairly experienced.”
The safety agency said on Tuesday that there was still information that needed to be collected from the helicopter, a process that is expected to begin this week when its wreckage is lifted from the Potomac. Investigators said the two aircraft collided at 300 feet — a detail that has raised questions about how the helicopter got off course, given that it was not authorized to fly higher than 200 feet above ground.
The New York Times, through interviews with six current and former military aviators and a civilian helicopter pilot who frequently flies the routes near National Airport, has pieced together some understanding of the conditions that the crew faced the night of the crash.
The crew in the UH-60 Black Hawk left its home base, Fort Belvoir in Virginia, after dark last Wednesday to conduct a training mission to allow the co-pilot, Capt. Rebecca Lobach, to perform a required annual evaluation flight.
It was part of the small group of military and civilian law enforcement helicopters authorized to fly in the highly restricted airspace over Washington and Northern Virginia. Those pilots must fly along designated routes that generally follow the Potomac and Anacostia Rivers. The air traffic controllers inside the tower at National Airport manage that airspace for helicopters and planes alike.
These routes specify certain altitude restrictions for helicopters along the water, including Route 4, the one that prohibits flying higher than 200 feet over the stretch of the Potomac where the collision occurred.
That restriction, according to several of the pilots, provides little room to maneuver in case of an emergency. At such a low altitude over a river, moving up — not down — is the more realistic response.
Mr. Roth said there are helicopter routes at Dulles International Airport and Baltimore/Washington International Thurgood Marshall Airport that allow pilots to fly over the commercial jet airspace rather than through it, which gives pilots more options in the event of an emergency.
“I can’t think of anywhere where you can fly next to a major airport at 200 feet,” said Mr. Roth, who was in the same unit as the crew of the helicopter that crashed. A combination of dark skies and surrounding city lights — lights that would have been amplified exponentially if the crew members were wearing night-vision goggles — may have distracted them as they searched for nearby air traffic.
“So they’re flying over a black water surface of the Potomac with ground clutter and the buildings behind them,” said Senator Tammy Duckworth, the Illinois Democrat who flew Black Hawk helicopters during her military career.
At about 8:46 p.m. last Wednesday, an air traffic controller warned the helicopter crew that a passenger jet was nearby. That plane, American Airlines Flight 5342, had been redirected from Runway 1, which regional jets commonly used, to the lesser-used Runway 33.
Captain Lobach was most likely in the right-hand seat, said a senior Army official who has flown the National Airport helicopter routes repeatedly but requested anonymity because he was not authorized to speak publicly.
This is significant, the official said, because if the instructor pilot was busy or distracted with something, Captain Lobach’s seat on the right side of the aircraft might have put her in poor position to view the descending American Airlines flight on her left.
Still, other experienced military pilots said they were puzzled at the crash, given that military pilots are trained to be ready for such hazards.
The Black Hawk, a twin-engine aircraft introduced in the 1970s that has inspired a variety of models, has long been a fixture in the U.S. military, both for general purposes and for more tailored missions. In the Army alone, about 2,000 Black Hawks are in operation today.
In the Washington area, which is home to the White House, the Pentagon and several air fields from which both training flights and the transport of the president and other senior officials often originate, Black Hawks are ubiquitous.
The 12th Aviation Battalion at Fort Belvoir flies two types of Black Hawks: the UH-60L, an old model, and the VH-60M, a newer one. The aircraft involved in the crash was the older model. It does not have the ability to let pilots fly on autopilot but it is not considered insufficient for the job, according to the senior Army official.
Regardless, the official said, the crew flying along the Potomac River would not have found autopilot helpful. Low-level flying, he said, requires constant attention to terrain, obstacles and routes.
The Black Hawks, even the older models, are not especially hard to operate, said current and former military aviators. But the congestion around National Airport, one of the country’s busiest public airspaces, requires particular adeptness and a willingness to hang back if necessary to let passenger jets take off or land safely.
“That aircraft was in the wrong place well before they were in the same literal airspace with the CRJ,” said Jon-Claud Nix, a former Marine Corps helicopter pilot, using the abbreviation for the jet that was involved in the collision.
Mr. Nix, who has reviewed the air traffic control recordings and other public details of the crash, added, “They just needed to hold off a little bit to properly identify or locate their correct traffic.”
He said that in the final moments before the crash, the Black Hawk crew was essentially on its own to avoid collision. That is because the crew, according to a recording of the air traffic control audio, had requested what is known as “visual separation,” which under aviation rules means the crew would search out nearby traffic on its own, without assistance from controllers.
And the older Black Hawk model the crew flew last Wednesday most likely did not have certain air-safety systems that are standard among U.S. passenger jets.
For example, it would not have had the Traffic Collision Avoidance System, nicknamed TCAS, which alerts pilots to the fact that their planes are dangerously close to other aircraft and can redirect pilots to quickly climb or descend if a crash seems imminent.
The pilots say one or all of these factors could have contributed to a tragic sequence of events.
“Especially on that route,” Mr. Roth said, “it’s 200 feet which is a low altitude. It’s in proximity to other aircraft. The lighting conditions are tough and there’s just not many places in the world where all of that is happening to anyone all at once.”
Anthropic is teaming up with several large investment firms to create a venture that will help companies integrate artificial intelligence tools into their systems, the latest example of the deepening ties between Wall Street and the A.I. industry.
The private equity firms Blackstone and Hellman & Friedman and the investment bank Goldman Sachs through its investment funds are among the financial backers in the new firm, which will work with companies to deploy Anthropic’s A.I. model Claude.
In announcing the creation of the firm on Monday, Anthropic and the investment firms said the technology around A.I. was changing so rapidly that many companies were finding it challenging to integrate Claude.
The backers of the new firm said it would work with Anthropic’s engineers to help companies deploy Claude, which has abilities that “change on a monthly or even weekly basis.”
The creation of a firm combining Wall Street and Anthropic comes as the A.I. industry is locked in a fierce competition to become the go-to A.I. model in the private and public sector. It is also happening as A.I. companies, including Anthropic and its rival OpenAI, are expected to soon go public in what could be the largest series of public stock offerings ever, creating a boon for Wall Street.
The decision by Blackstone, Goldman and the other investment firms to partner with Anthropic is a notable endorsement of an A.I. company that the Trump administration has criticized for refusing to allow the Pentagon to deploy its models without meeting the company’s ethical limits.
Anthropic and the Pentagon are in federal litigation over the Defense Department’s decision to label the company a supply chain risk, an unusual use of the government’s power to raise concerns about how corporations build their products.
Many of the details of Anthropic’s venture with Wall Street have not yet been announced, including its name and chief executive. But one area that the venture said it would start working on is integrating Claude at portfolio companies of the private equity firms that backed this deal, including Blackstone and Hellman & Friedman.
Anthropic, Blackstone and Hellman & Friedman said they would each put $300 million into the new company, and Goldman Sachs would contribute roughly $150 million, according to two people familiar with the deal terms. General Atlantic, Leonard Green, Apollo Global Management, GIC and Sequoia Capital are among the other firms that are taking part and investing in the venture.
Wall Street banks have been among A.I.’s enthusiastic corporate users. During the first quarter earnings reports from the largest banks, some executives discussed with unusual candor how A.I. had automated certain jobs, which in turn led to job cuts and higher profits.
Elon Musk recently demanded that banks, law firms, auditors and other advisers working on the I.P.O. of his company, SpaceX, to buy subscriptions to his A.I. chatbot, Grok.
Business
Regulators may seek to suspend State Farm’s license, citing widespread mishandling of L.A. wildfire claims
California regulators may seek to suspend State Farm’s license for up to a year and levy millions in penalties against the insurer, alleging it mishandled January 2025 wildfire claims in Los Angeles County.
In an extraordinary step, the Department of Insurance announced Monday that it filed an administrative action against the state’s largest home insurer after an investigation into 220 sample claims found 398 violations of state law in about half of them.
“Our investigation found that State Farm delayed, underpaid, and buried policyholders in red tape at the worst moment of their lives,” Insurance Commissioner Ricardo Lara said in a statement. “That is unacceptable, and we are taking decisive action to hold them accountable.”
The department is seeking a cease-and-desist order to stop the insurer from engaging in unfair or deceptive practices — and to possibly suspend State Farm’s “certificate of authority” for up to a year, meaning it could not write policies during that period, department spokesperson Michael Soller said.
While the terms of the proposed suspension aren’t clear, the move could prevent the insurer — which covers more than 1 million homes — from issuing new policies at a time when the state is facing an insurance crisis.
The case will be heard by a state administrative law judge, who will provide a recommendation to Lara on a possible monetary penalty and whether to carry out the license suspension. State regulators declined to comment on the action or how it might affect policyholders.
State Farm on Monday rejected the department’s claims that it engaged in a “general practice of mishandling or intentionally underpaying wildfire claims” and said it will further respond through the legal process.
“California’s homeowners insurance market is the most dysfunctional in the country,” State Farm said in a statement. “The California Department of Insurance should take responsibility for regulatory delays and uncertainty that have contributed to fewer choices and higher costs for consumers.”
State Farm said it has paid more than $5.7 billion and handled more than 11,700 residential and auto claims. That is nearly one-third of those filed after the Jan. 7, 2025, fires that damaged or destroyed more than 18,000 structures and killed 31 people.
The department in June 2025 launched a “market conduct exam” into State Farm General — the subsidiary of the giant Bloomington, Ill., insurer that handles California home insurance — after complaints by victims of the fires in Pacific Palisades, Altadena and nearby communities.
The Times reported that within two months of the fires homeowners were getting frustrated with the insurer over its handling of smoke damage claims. They contended that State Farm was resisting hygienic testing for toxic chemicals and was trying to minimize cleanup costs, which the company denied.
Later, anger was directed at Lara, with fire victims saying he wasn’t cracking down on State Farm. More than a dozen homeowners told The Times this year that the department did little to resolve a wide range of complaints they filed against State Farm.
Los Angeles County also has an ongoing investigation into the insurer.
Nevertheless, the threat to suspend State Farm’s license because of the alleged violations was met with skepticism. The company has a roughly 20% market share. It’s unclear where its policyholders could find coverage.
State Farm’s decision to not renew some 72,000 residential policies in March 2024 because of its losses after a series of wildfires sparked fears that California’s home insurance market could be on the brink of collapse.
“Given how the department has bent over backward to prevent State Farm from carrying out its threats to leave the state due to its alleged financial problems, it’s hard to believe,” said Carmen Balber, executive director of Los Angeles advocacy group Consumer Watchdog.
Soller said the terms of a possible suspension — including whether it would apply only to new policies or existing policyholders — would be set after the hearing.
“Any order must define the terms of a suspension based on the evidence at a hearing. We cannot predict what an order after a hearing on the evidence will be,” he said.
The results of the market conduct exam were released Monday in support of the legal action.
It found that the company failed in numerous cases to pursue a “thorough, fair and objective investigation” into claims, failed to come to “prompt, fair, and equitable settlements” and made settlement offers that were “unreasonably low.”
Other alleged violations included a failure to give timely responses to claims, provide a factual or legal basis for claim denials and give victims a primary point of contact after assigning three or more adjusters in a six-month period.
The legal filing also faults the company’s handling of smoke damage claims, including denials of payments for hygienic testing.
The company denied it was at fault in some cases and admitted it was at fault in others, often saying that the problem was due to issues with specific adjusters, and that it held meetings with adjusters after hearing about the alleged violations.
State Farm said Monday that the “additional payments tied to the issues identified in the Market Conduct Examination were about $40,000 in the context of more than $5.7 billion paid.”
The alleged violations each carry a fine of up to $5,000 in general and up to $10,000 if they are found to be willful.
The department said the alleged violations could bring penalties of $2 million or more. Soller said regulators also want State Farm to make policyholders whole, but does not have authority to order restitution
Soller noted that is why the department is sponsoring a bill by state Senate Insurance Committee Chair Steve Padilla (D-Chula Vista) that would require insurers to pay restitution directly to policyholders.
State Farm released a statement April 22 that outlined five “commitments” to policyholders.
They included providing single points of contact and improved communication so there are “fewer handoffs, fewer repeated explanations, and seamless support.”
Fire victims have long called for a crackdown on the insurer and to bar a rate increase State Farm was seeking until it resolved their complaints. They also called for Lara’s resignation, claiming he was not enforcing the law, while he contended the market conduct exam needed to take its course.
The company was ultimately granted a 17% rate hike in March after a three-way agreement that also involved Consumer Watchdog, which had intervened in the matter as allowed under state law.
Joy Chen, executive director of Every Fire Survivor’s Network, a community group that led the calls to stop the rate hike and for Lara’s resignation, said the insurer must make harmed policyholders whole.
“We call on the department to act on every outstanding complaint, and report transparently on outcomes. State Farm’s parent sits on $240 billion in assets. They have the money to fulfill their obligations to L.A. fire survivors,” Chen said.
Possible sanctions against State Farm are a “positive development” but mean little in practice for Pacific Palisades property owner John Hurley, who continues to fight the insurer to mediate asbestos and heavy metal contamination from the fire nearly 16 months ago.
He said State Farm stopped reimbursing him for lost rent on the unrepaired house. Hurley has filed at least half a dozen complaints with the state insurance department, to little avail.
“I unfortunately feel the insurance companies and the state are somewhat allies,” Hurley said. Even if the state agency were to prevail in sanctions against State Farm, “who gets the money? The state … or the insured?”
Times staff writer Paige St. John contributed to this report.
A few months ago, Matt Bedsole got a call from two real estate developers asking for his help. Their plan to build a four-story apartment complex in Chattanooga, Tenn., had a financial hole that no backer seemed eager to fill. The developers needed $8 million. Would Mr. Bedsole be interested in stepping in?
Mr. Bedsole is not a normal investor. He is the chief executive of Invest Chattanooga, a fund set up by the city of 200,000 to invest in local apartment projects. Unlike private equity firms — the main backers of new construction — he judges deals not solely on their financial return, but on how much housing they can deliver the city.
The apartment complex cleared that hurdle. It called for 170 new units that would replace a self-storage center ringed by barbed wire, in a gentrifying part of the city. But Mr. Bedsole had terms. In exchange for the $8 million investment, he got a 51 percent stake in the building and an agreement that 30 percent of its units be priced below market rate. The developers said yes. They closed the deal over pastrami sandwiches.
“Money is tight and developers don’t have a ton of options for capital right now,” Mr. Bedsole said in an interview. “We have it, but we want affordable units in the deal.”
Invest Chattanooga is part of a new class of government-backed funds that invest directly in new housing. The aim is to speed up construction and create housing that is permanently affordable and controlled locally. In the process they are rewriting how local housing programs have traditionally operated.
Each effort is a little different, but the guiding principle is to get developers to build more housing, with lower rents, in exchange for public investment. Instead of asking a high rate of return, as a private investor would, these funds require less money back from developers but stipulate that a portion of the units carry below market-rate rents.
They come at a time when a mix of higher interest rates and rising costs for insurance and materials like lumber have caused investors to run from new construction. Economists estimate the nation needs about 2 million new housing units, yet the pace of home building slowed last year.
Some states, like Hawaii, have created funds that lend money to developers on more favorable terms than Wall Street or a bank would, while others, including New York, have created funds to accelerate stalled projects. Atlanta aims to use public land to stimulate new home building: The city’s Urban Development Corporation contributes city-owned land to private development projects and keeps a stake after the building is completed.
Then there are public investment funds like the one in Chattanooga.
There are about two dozen of these funds in the United States, said Shaun Donovan, the chief executive of Enterprise Community Partners, which recently created a team to help them and is trying to set up its own fund to augment their efforts. The funds provide “capital, but capital at this moment of maximum impact, which is getting the building out of the ground,” said Mr. Donovan, who served as the housing secretary in the Obama administration.
Most of these efforts were inspired by Montgomery County, Md., whose Housing Opportunity Commission has for decades been a kind of national laboratory for affordable housing innovation. Mr. Bedsole has been something of a human catalyst in this process: He helped create Atlanta’s system based on the Montgomery County model, then took these ideas to Chattanooga last year.
“The cavalry isn’t coming, so we have to figure this out on our own,” said Tim Kelly, Chattanooga’s mayor.
From Public Housing to Patchwork
Figuring out how to produce low-cost housing for people who cannot afford market rents is a riddle that has vexed cities throughout the modern era. Governments have spent much of the past century veering between public and private sector solutions. Today most new affordable housing is delivered by a hybrid system, in which public subsidies finance private development.
That system is a product of shifting politics more than considered policy design. Starting in the 1970s, the federal government essentially stopped building public housing as part of a broader shift away from welfare benefits. What replaced it was a patchwork of rental vouchers and tax benefits — the biggest of which, the Low-Income Housing Tax Credit (LIHTC), was created in 1986 — for companies that provide affordable housing. Local governments now depend on that credit to build everything from low-cost apartments for teachers to supportive housing for people leaving homeless shelters.
One of the problems with low-income tax credits is that they are complicated to use and expire over time, often between 15 and 30 years, at which point the building’s owner can start charging market rents. It’s a galling turn for cities, since they often give millions in grants to finance affordable projects. To prevent building owners from evicting low-income tenants after the affordability restrictions lapse, many governments end up buying buildings back.
“So now the state has paid for the building twice — initially with subsidies, and then by giving a wad of cash to the developer,” said Stanley Chang, a state senator in Hawaii. “That is obscene.”
A Small Chip at a Growing Problem
Mr. Kelly, the mayor of Chattanooga, said he created Invest Chattanooga to prevent that obscenity. A businessman who ran car dealerships and co-founded the local soccer club, he was elected in 2021 (and re-elected last year) on an affordable housing platform.
At first, Chattanooga responded to its housing crisis by overhauling its zoning laws to allow more density, and legalizing backyard units on residential lots. This was the formula followed by many state and local governments over the past decade as rent and house prices have ballooned. But, as in many cities, the construction that followed leaned heavily toward higher-end buildings, where rents are too expensive for large swaths of the work force.
According to a city report, over the past five years Chattanooga has lost about half of its apartments that rent for less than $1,000 a month. The new apartments rent for too much, while federal programs do not produce enough units to meet the need.
But there are two ingredients in construction: land and money. So Chattanooga decided to focus on the second of these and became an investor, putting up $20 million to create Invest Chattanooga and hiring Mr. Bedsole from Atlanta to run it.
Invest Chattanooga is run like a business that makes money, then turns profits into cheaper housing. It puts up the initial cash, usually a mix of equity and debt financing, that developers need to get a bank loan. In exchange for the money, projects built with the fund must have at least 30 percent of their units reserved for families making below the median income in the area.
The city gets a return but it’s low — about 8 percent on the recent deal to replace the storage center, versus private equity firms that in many cases ask for double that amount. That difference can mean a developer saves several million dollars on a multiunit building, making it possible to lower the rent. And unlike units built with federal tax credits, Invest Chattanooga owns the building so can capture the upside of higher land values down the line.
Mr. Bedsole said Invest Chattanooga has a relatively modest goal of producing 100 affordable units a year by 2030, and to raise an additional $20 million for more projects. It is one little chip in a problem that gets bigger every day. Unlike the public housing agencies of old, his agency is not replacing developers in the process of building housing. Rather, it is trying to replace the financiers who decide what does and does not get built.
“I’m not competing with developers,” Mr. Bedsole said. “I’m competing with private equity.”
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