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Why Is California rebuilding in fire country? Because you’re paying for it

Christopher Flavelle, BLOOMBERG NEWS

At the rugged eastern edge of Sonoma County, where new homes have been creeping into the wilderness for decades, Derek Webb barely managed to save his ranch-style resort from the raging fire that swept through the area last October. He spent all night fighting the flames, using shovels and rakes to push the fire back from his property. He was even ready to dive into his pool and breathe through a garden hose if he had to. His neighbors weren’t so daring—or lucky.

On a recent Sunday, Webb wandered through the burnt remains of the ranch next to his. He’s trying to buy the land to build another resort. This doesn’t mean he thinks the area won’t burn again. In fact, he’s sure it will. But he doubts that will deter anyone from rebuilding, least of all him. “Everybody knows that people want to live here,” he says. “Five years from now, you probably won’t even know there was a fire.”

As climate change creates warmer, drier conditions, which increase the risk of fire, California has a chance to rethink how it deals with the problem. Instead, after the state’s worst fire season on record, policymakers appear set to make the same decisions that put homeowners at risk in the first place. Driven by the demands of displaced residents, a housing shortage, and a thriving economy, local officials are issuing permits to rebuild without updating building codes. They’re even exempting residents from zoning rules so they can build bigger homes.

State officials have proposed shielding people in fire-prone areas from increased insurance premiums—potentially at the expense of homeowners elsewhere in California—in an effort to encourage them to remain in areas certain to burn again. The California Department of Forestry and Fire Protection (Cal Fire) spent a record $700 million on fire suppression from July to January, yet last year Governor Jerry Brown suspended the fee that people in fire-prone areas once paid to help offset those costs.

Critics warn that those decisions, however well-intentioned, create perverse incentives that favor the short-term interests of homeowners at the edge of the wilderness—leaving them vulnerable to the next fire while pushing the full cost of risky building decisions onto state and federal taxpayers, firefighters, and insurance companies. “The moral hazard being created is absolutely enormous,” says Ian Adams, a policy analyst at the R Street Institute, which advocates using market signals to address climate risk. “If you want to rebuild in an area where there’s a good chance your home is going to burn down again, go for it. But I don’t want to be subsidizing you.”