Property damage from January wildfires in Los Angeles County, including the Eton and Palisades fires, is estimated at between $28 billion and $53.8 billion, according to a report released Thursday.
The report, commissioned by the Southern California Leadership Council and the LA County Economic Development Corporation, examines the broad economic impacts of two of California’s most devastating wildfires. The report examines the destruction and economic losses caused by the fire and provides data-driven recommendations to guide recovery efforts.
Some important findings from the report:
The fire will bring labor income reductions to up to $3.7 billion. Federal, state and local governments were able to see tax revenue losses ranging from $730 million to $1.4 billion. Business disruption is projected to result in up to $8.9 billion in economic losses in Los Angeles County over the next five years.
The report examines investments in prevention and recovery taking into account the economic damage and personal casualties of the fire, former California Gov. Grey Davis, co-chair of SCLC, said at an online press conference.
“The recovery process is especially important to speed from a financial perspective,” Davis said. “Job 1 is to help people rebuild and return to their new homes.
“We must learn the lessons from this fire and the previous fire. We need to build a better home. So we will not repeat this terrible tragedy. Let’s learn the lessons.”
This study examined how fires are projected to affect major industries. Research shows that retail, healthcare, professional services, construction and education services have been hit hardest.
Disruptions in supply chains and labor movements could exacerbate the economic challenges of the region, the report said.
LAEDC President and CEO Stephen Cheung said the best-case scenario will recover by 2029, but the process could take years more. The effects of the fire will grow with the length of recovery, he added.
The report says steps towards recovery will include efforts to rebuild rapid tracing with coordinated permitting processes and financial incentives, reducing recovery timelines by up to 50% and strengthening fire-prone communities to improve emergency response systems, microgrids, and fire-resistant construction materials and methods required by current building standards in California.
Additionally, alternative insurance models such as parametric insurance can be implemented to quickly guarantee financial relief for affected businesses and homeowners. Parametric insurance pays an amount set based on the magnitude of the event, not the magnitude of the loss in traditional coverage policies.
Researchers further suggest that direct support will be provided to affected businesses and displaced people through grants, training programs and SMEs recovery initiatives to prevent long-term economic declines, the report said.
Establishing a multi-agency wildfire task force using a clear recovery roadmap could also reduce response times and improve post-disaster efficiency, according to the report.
Source link
