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A Burning Issue: Stanford scholar testifies on rising costs of wildfire

Michael Wara addresses U.S. Senate Committee on the Budget

Woods Senior Research Scholar Michael Wara addresses U.S. Senate Committee on the Budget about the economic risks of climate-fueled wildfire

While the risk of fire in the west may seem far off now, U.S. legislators are bracing for what’s to come as the human and economic costs of recent conflagrations mount. The U.S. Senate Committee on the Budget recently invited Woods senior researcher Michael Wara to brief legislators on the risks and ways to prepare during a March 8 hearing on “A Burning Issue: The Economic Costs of Wildfires” (watch full hearing on the committee’s website). Among other jurisdictions, the committee is chiefly responsible for drafting congressional budget plans and overseeing federal spending for things like wildland firefighting costs of the US Forest Service. 

Those costs averaged $4 billion in 2020 and 2021 and are on the rise, Wara warned.  “The impacts of climate change - realized through higher summer temperatures and lower seasonal vapor pressure deficit - mean that these numbers are not going to fall. Instead they are going to predictably increase,” Wara testified. ​​

“Behind these growing costs is a growing human toll in our wildland firefighting workforce as well. The workforce is being asked to fight more intense wildfires, for longer wildfire seasons, and this is taking a real human toll on the workforce that pay raises will help to make more manageable but will not solve. Maintaining force readiness in the face of 21st Century wildfire is likely going to require fundamental structural change in wildland firefighting that will increase costs at the state and federal level even beyond where they are now.”

This session was the third in a series of hearings new Budget Committee Chairman Sen. Sheldon Whitehouse (D-R.I.) has convened to focus attention on the economic costs of climate change. His first session covered global economic threats from extreme weather, while his second focused on risks associated with sea level rise.

“I can make the case for the danger of unchecked climate change blowing the debt through the roof, in the same way that both the mortgage meltdown and the pandemic together added $10 trillion to the deficit,” he said in an interview with the New York Times.

The comments from Wara and other speakers at Wednesday’s hearing emphasized the fiscal costs from wildfire extend far beyond property loss. A “status-quo” approach to suppression-based fire management policy has dire implications for housing in areas stressed by rising home costs.

“California, Oregon, Colorado, and other western states have lost truly unprecedented numbers of structures to wildfire over the past 5 years. California alone has lost close to 40,000 homes,” Wara testified.  “These losses have important knock-on effects that impact the federal budget and create systemic risk for the national economy. Housing markets in California and the west are tight and housing affordability is a kitchen table issue – maybe the kitchen table issue. In any region where a wildfire occurs, these issues become supercharged.”

Intended as educational for committee members, the hearing featured four experts, including Wara, who directs the Woods Institute’s Climate and Energy Policy Program and has served on the California Commission on Wildfire Cost and Recovery as well as on the oversight board of the California Wildfire Fund, a utility wildfire insurance mechanism created by California in 2019.

Other witnesses called before the committee included Veronica Serna, Mora County Commissioner, District 1, New Mexico; David Burt, founder and chief executive officer of DeltaTerra Capital; Morgan Varner, Director of Research and Senior Scientist, Tall Timbers and Nicholas Loris, Vice President of Public Policy, C3 Solutions.

As the two-hour session drew to a close Sen. Ron Wyden (D-Oregon) asked Wara to draft a set of recommendations for bolstering the nation’s firefighting workforce. “These firefighters have been so courageous, so gutsy - but they’re coming to my meetings and explaining this is impossible to sustain,” Wyden said.  The state of Oregon has “forestry in our DNA and we never expected anything like this. This is not your grandfather’s forestry challenge.”

Wara’s full testimony and video of the event are available at the committee’s website.

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The Woods policy and engagement team is available to assist Stanford researchers interested in connecting with federal or state policymakers.

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