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New Study Shows Real Economic Impact of Wildfires

The study shows that the 2003 San Diego wildfires cost $2 billion more than estimated.
A firefighter fights a recent Southern California wildfire.
A firefighter fights a recent Southern California wildfire.

Californians are all too familiar with the devastating impacts of wildfires – to the environment, to property and to lives. But a new San Diego State University study shows that the actual economic costs of wildfires are much greater than generally estimated – results that are staggering, particularly given the state of California’s budget.

Researchers studying the 2003 San Diego wildfires looked at factors not typically analyzed after a major wildfire, and found that the actual economic impact of that fire was more than $2 billion more than was actually estimated.

Why such a large disparity? Because historically, reports about the economic impacts of wildfires have looked at suppression costs, federal assistance or loss of property. They have neglected to analyze long-term impacts, such as watershed and water quality mitigation, sensitive species and habitat restoration, and bond offerings and firefighting investments as a result.

“You think about what happens when you shut down the city of San Diego for a couple of days, which in essence is what happened,” said Matt Rahn, director of research and education at SDSU’s College of Sciences' Field Stations Programs, who led the study. “You close down our city, you close down our airport, you close down our ports and you realize how many delayed or cancelled flights there were, what the tourism impact was, what the impact to business lost was.”

Real costs of wildfires

During the 2003 wildfires, a total of 375,917 acres were burned in San Diego County, including 3,241 homes lost. Other significant impacts found by the SDSU study include:

  • Lost Business: $365 million
  • Medical Costs: $10 million
  • CalTrans: $15 million
  • Watershed Protection: $47 million
  • Infrastructure: $147.3 million

Recommendations for future planning

The study also provides recommendations on how to improve assessments and help governments and fire fighting organizations better prepare for future wildfires, including:

  • Conduct future economic assessments promptly, to avoid loss of data or institutional memory
  • Develop a rigorous, statistically valid and standardized protocol for future assessments
  • Develop a strategy for assessing impacts to cultural and historic resources
  • Ensure proper staffing and resource needs to ensure effective response and control for wildfires

According to Rahn, suppression costs – staffing and equipment used to put out the fires – are a very small part of the overall costs, just 2 percent. Yet without proper staffing, the damage can be worse and, in the long run, the economic impacts potentially even more severe.

Download the Wildfire Impact Study here.

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