Boulder County, on Colorado’s urban Front Range, mostly missed the building boom that hit the prairies to its east a decade ago. Any land that wasn’t protected as open space was already developed. (The county has one of the most densely developed wildland-urban interfaces in the country.) What was left was pricey and strictly regulated. As a result, most homes, especially in the foothills, were expensive, if dated — relics of the ’70s, ’80s and ’90s.
But in one place, things have changed. Dozens of brand-new homes dot the landscape, many of them energy-efficient and architect-designed. Unremarkable $500,000 homes have been replaced by $1.1 million mansions in a full-tilt construction frenzy — courtesy of a raging wildfire.
The Fourmile Canyon Fire tore through 6,000 acres of Boulder’s foothills for just a few days in September 2010. But at the time, it was the costliest fire in Colorado’s history, with 168 homes, valued at over $200 million, burned to ashes. Add $14 million in firefighting costs and some $1 million in lost tax revenues on devalued property in the years since, and you’ve got a natural and financial catastrophe.
But every $1 billion fire season — and experts believe we’re heading into another one — has, believe it or not, a silver lining. Just as a fire can have positive ecological effects, so the cash spent to fight it and rebuild afterward can boost local economies, says Cassandra Moseley, director of Oregon’s Ecosystem Workforce Program and author of a study on the nuances of fire’s effects on communities.
Boulder County’s silver lining appeared shortly after the Fourmile Fire, as insurance payments flowed to homeowners who kept their policies apace with rising property values. A handful of folks abandoned Boulder altogether, using the cash to buy boats or homes in cheaper zip codes, and some bought elsewhere in the county. But at least half rebuilt. Meanwhile, the county streamlined permitting — some re-builders navigated the normally months-long process in just a few days.
During the 30 months after the fire, 182 permits were issued for single-family homes together worth $81.6 million; half were for fire-related rebuilds. That’s twice the number and value of permits issued in the county for the previous 30 months, and four times the value of those issued between 2004 and 2008, during the height of the national housing fever. The fire not only efficiently cleared away brush thickets and dead grass, it left a blank canvas for new development bankrolled by insurance payments.
Nearly all of the rebuilt homes are worth more than the ones they replaced. And, bucking expectations, the real estate market on the fire’s fringe has held strong: One home that was licked by, but withstood, the flames sold in 2007 for $537,000; last year it sold again, for $761,500. Higher price tags yield higher property taxes, filling county coffers.
But that’s Boulder. Real estate values have plummeted elsewhere by 10 to 15 percent after an initial wildfire, according to studies by Colorado State University resource economist John Loomis, and tumbled further after subsequent fires thanks to greater perceived risk. Other economic sectors, especially tourism, suffer, too. During and right after the 2012 Waldo Canyon Fire near Colorado Springs, which burned 350 homes and topped Fourmile as the state’s priciest, local lodging revenues dropped by almost 20 percent.
Yet even those hits can be offset to some degree, says Moseley. Most of the money spent on fire suppression comes from the feds or the state and is “captured” by the community when locals go to work on fire lines, or non-local firefighters buy food, gas and the like. Moseley’s study found that local capture rates vary from 5 to 25 percent, meaning that a $20 million fire could infuse the local economy with as much as $5 million.
Money rolls in after the smoke settles, too. Boulder County received $3.4 million in federal and state grants to rehabilitate the charred areas — a sort of stimulus package for local contractors. And the Colorado Springs Convention and Visitors Bureau got $110,000 in federal and state grants for post-fire PR. Meanwhile, the Federal Emergency Management Agency shoulders at least 75 percent of the costs incurred by local fire response for big blazes.
That’s not to say that wildfires have a net positive impact on communities. They usually don’t. But when the total cost of a fire is being tallied, these upsides are almost never considered. Nor, for that matter, are the serious non-financial consequences: the loss of beloved homes and property –– and, on occasion, even life –– along with the health impacts of lingering smoke. “This boost doesn’t undo any of those losses,” Moseley says. “It’s just another frame on it. It’s taking a step back and looking at the ecological and economic benefits other than what’s talked about during the moment.”
To see those benefits, take a drive down Sunshine Canyon Drive. Over there, where a little cabin, circa 1972, was reduced to ashes, now stands a half-million dollar, three-bedroom home of steel, glass and corrugated tin, with a huge deck along one side. It’s powered by the sun and specially built to resist the next conflagration. The south wall, which is entirely glass, frames an expansive view of emerald-green grass sprouting from the scorched earth.
This article appeared in the print edition of the magazine with the headline Burning money.
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