Research Shows States Need to Budget More for Wildfires

PEW researchers have found that “Wildfires: [are] Burning Through State Budgets.”

One of the “up and coming” types of climate-driven disasters, one among many, is wildfires. PEW found the following:

• States most commonly draw on general fund revenue for wildfire activities and often pay upfront for these costs while awaiting reimbursement from other levels of government. States primarily use backward-looking estimates based on past suppression costs to decide how much funding to allocate for these expenses.
  
• These budgeting practices are under strain: In recent years, the estimates states have used to inform their wildfire budgets have frequently proved insufficient, forcing states to cover spending gaps using after-the-fact budgeting tools such as supplemental appropriations. While these reactive mechanisms provide needed flexibility during emergencies, they also obscure from the state budgeting process the true costs of wildfires.
  
• Federal and state investments in cost-saving mitigation activities are growing, both to manage forests and to make homes, buildings, and other infrastructure less susceptible to fires. However, barriers persist to allocating resources toward mitigation, including the continued prioritization of fire suppression, difficulty in accessing and managing federal mitigation funds, and investing at the scale required to address the mounting frequency and severity of fires.

It is the same for risk insurance, fire insurance, all those other climate-driven hazards that are changing the landscape. Bigger fires, more damages, and more recovery measures are needed. States will likely need to add a couple of zeros to the numbers that they have used in the past when budgeting. These funds are normally general fund type expenditures, and losses and mitigation efforts will pull funds away from other state programs.

Based on these findings, Pew developed three recommendations for policymakers who are tasked with managing the growing risks and spending associated with wildfire:

• States should evaluate and strengthen current budgeting practices to account for growing risk. By comparing actual spending versus expected spending, assessing the threat of future fires, and implementing other tools, states can more accurately understand how much to budget for wildfire management, including mitigation.

• States should maximize investments in evidence-based mitigation activities. Beyond simply increasing mitigation spending, this means looking for ways to ensure that the immediate need for suppression funding does not directly compete with mitigation investments, which can help manage these costs in the long term. Additionally, steps should be taken to reduce the barriers states and localities face in accessing and implementing federal mitigation funds.

• States should explore opportunities to better track and share data on wildfire spending. Wildfire spending data should be made more accessible, transparent, and comprehensive across all levels of government, which could improve intergovernmental coordination and provide policymakers with evidence to more strategically allocate resources.