(Reuters) – California risks a growing spiral of wildfire catastrophes and rising housing costs unless it completely revamps the way it rebuilds after the fires and finds ways to discourage construction in areas of high risk, according to a study published Thursday.
The study by the UC Berkeley Center for Community Innovation and the Next 10 research institute also warned of an impending insurance crisis unless the laws are changed.
Building in established communities that are largely protected from wildfires is more expensive, so developers continue to encroach on dry, mountainous terrain that is more affordable. Meanwhile, communities that have burned in past fires tend to rebuild where houses were razed.
That avoids the short-term expense of moving out of danger zones or redesigning homes in clusters surrounded by more easily defended territory, but in the long run the costs are much higher, according to the study.
“The cost (of the status quo) continues to rise,” said Robert Olshansky, one of the report’s authors.
Insurance payments for fire claims averaged $ 100 million per year from 1964 to 1990, but have soared to a total of about $ 26 billion for 2017 and 2018 alone, the study researchers found.
Among the policy prescriptions are the addition of an additional property tax in hazardous areas and an insurance regulation that would allow prices to discourage construction in hazardous areas, Olshansky said.
“What we are proposing is to think about this more broadly,” Olshansky said in a telephone interview. “There is much more political will for this than two or three years ago.”
But at a time when one in 12 California homes is located in a high-risk wildfire area, state policies restrict insurers’ ability to adjust rates based on risk or drop customers in fire-prone areas. , according to the study.
In addition, property tax law prevents the state from charging a surcharge in high-risk areas that could pay for proactive policies. An assessment of 0.25 percent of properties in high-risk areas could generate more than $ 1.8 billion, according to the study.
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