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Measuring the Economic Impact of Catastrophic Wildfire

As many residents east of Flagstaff remain worried about flooding below the Schultz Fire burn area, they are joined by many other residents statewide who are waiting to determine what life will be like after the big one.  In eastern Arizona, the Wallow Fire burned more than 500,000 acres.   The short and long term impacts will ripple through local and statewide economies well after the last ember is out. Looking back at past fires in Arizona and New Mexico might help  some people gauge Wallow’s impact on future recovery.

Up until Wallow sparked on May 29, 2011, the Rodeo-Chediski in June 2002 was Arizona’s worst forest fire ever. The Rodeo-Chediski forced over 40,000 people in Pinetop-Lakeside, Show Low, and Heber-Overgaard to evacuate their homes and businesses. Over 465,000 acres burned in less than a month.

Peter Tims, owner of White Mountain Jewelers in Show Low, worried most about the aftermath and how the Rodeo-Chediski fire would affect his hometown and local businesses.

“I thought no one in the valley would come up here because they thought we were all burned up,” Tims says. “It was eight months, maybe a year, before I noticed things really getting back to normal. Roughly 60% of Show Low’s economy relies on retail sales.”

Tims’s jewelry business recovered faster than he assumed it would, despite fire-related unemployment in Navajo County shooting up to 26%, and his overall opinion on how cautious consumers were once they returned to Show Low.

“My store suffered an immediate decrease in business, but it came back strong. The numbers even surprise me.”

Large fires affect communities in diverse ways. Unlike the Rodeo-Chediski, the May 2000 Cerro Grande Fire in Los Alamos, New Mexico, only burned 48,000 acres but consumed just over 350 homes. Cerro Grande forced Los Alamos residents to evacuate, similarly leaving business and commerce at a standstill just as Wallow has in Arizona.

“None of our businesses were burned by Cerro Grande,” states Leslie Bucklin with the Los Alamos County Information Office. “We have a huge commuting population because of the National Laboratory here, so business wasn’t as affected as people might have expected.”

Wallow has already made some short-term impacts in the White Mountains and throughout the state. While business owners are forced to close in evacuated areas, and because many communities rely on products that aren’t provided by local industry, stopping commerce between towns like Nutrioso and larger cities such as Flagstaff or Phoenix has a domino effect.

On a positive side, as residents leave their homes, possibly rushing to relatives in larger cities or neighboring towns, communities throughout Arizona do experience spikes in revenue. Especially those that help lodge firefighting teams or federal employees.

Long term economic impacts are harder to gauge than the short term. According to the Arizona Department of Health Services Public Health Assessment of the Rodeo-Chediski Fire, the southern districts of Navajo and Apache counties lost 12 full days of sales tax revenue during the height of tourist season due to the evacuation of Show Low, Pinetop-Lakeside and Heber-Overgaard. This resulted in rippling budgetary problems for both counties long after the fire ended.

“Hopefully people will still be able to camp in areas that haven’t been burned [by the Wallow fire] around the towns,” Tims says. “Hunters, campers and tourists will come back, but it depends on how bad the burn is, and how much the towns have to recover.”

With federal agencies like FEMA designed specifically to help communities get back what disasters render on local homes and businesses financially, Arizonans will also have to band together to offer other kinds of support to ailing communities. Los Alamos did receive recovery assistance from the federal government, but it was also accompanied by a strong showing of resident-volunteers.

“Our community totally rallied together during the Cerro Grande Fire,” say Bucklin. “Volunteer groups sprouted from everywhere and offered to throw seed balls around Los Alamos. Eleven years after experiencing Cerro Grande, we’re still sensitive and very emotional about fires.”

Los Alamos has sent resources to help fight the Wallow fire, a good-willed gesture from one community that understands once the fire is extinguished, the immediate and extensive recovery begins.


Photo:  Peter Tims, Photo by Bradley Brock 

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