California Wildfires to Cost $180 Billion This Year

More Firefighters (David McNew / Getty)
David McNew / Getty

With firefighters gaining the upper hand as “red flag” winds die down, it appears that the bill for this year’s California wildfire season will come in at around $180 billion.

Weekend winds that included gusts of 40 to 60 miles per hour faded on Dec. 17, giving firefighters the opportunity to bring eleven of the twelve major CalFire Incidents to 100 percent containment.

Despite lots of dry brush and 10 to 20 percent relative humidity continuing to create wildfire risks for Santa Barbara, Montecito, Summerland, and the Matilija Wilderness; even the Thomas Fire, which has burned over 270,000 acres, destroyed 1,300 structures, and caused the death of two people, is now 45 percent contained.

It appears that next week will mark at least a temporary reprieve in the wind-driven wildfire crisis — and the clean-up will start. There were more than 100,000 mandatory and voluntary evacuation orders last week, but many of those orders were lifted on Sunday for Ventura, Ojai Valley, Santa Paula, Rincon Point, the North Coast, and Casitas Springs.

CalFire spokesman Scott McLean acknowledged on Dec. 6 that its direct firefighting costs were at least $65 million over its 2017-2018 budget of $426.9 million, which was supposed to fund operations through the end of June. Those numbers will undoubtedly spike higher as the current costs trickle, and the fire season could last into February.

But the total economic toll in the “costliest and most destructive wildfire year in California history” is already $180 billion, according to Dr. Joel N. Myers, founder, president and chairman of AccuWeather. Total loses will also include fire damage to commercial and residential structures; business and school closures; lost sales; clogged commuter routes; respiratory illnesses; and rehabilitation costs.

About $9 billion of insurance claims have been filed with 260 insurers for the October Wine Country fires including 2,300 business property claims; almost 5,000 vehicle claims; and 650 claims for other personal property, such as boats.

The Southern California fires this month could generate triple that amount in insurance claims. The insurance settlement cash will generate some economic activity in the coming months, but the insurance industry will undoubtedly hammer California residents with much higher insurance premiums in the future.

Another unknown economic cost of the fires is the impact on the the California state budget. Controller Betty Yee announced in early December that state revenues were up about $1.3 billion for the first five months of the state’s fiscal year, But the the spiking costs to fight the wildfires, lower net economic activity, and taxpayers deducting uninsured financial losses could cost the Golden State’s budget tens of billions of dollars.



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