Explaining Oregon’s problem paying for wildfire work

Oregon lawmakers will convene Thursday for a brief emergency session related to this year’s record-setting wildfire season. At the heart of the session are hundreds of millions of dollars in unpaid bills owed to the workers who helped put out blazes.

Here’s what you need to know.

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This year, wildfire touched over 1.9 million acres, making it Oregon’s most destructive fire season in modern times in terms of acres burned.

The season started out promising, with a lot of springtime rain and a high snowpack. But that precipitation helped shrubs and grasses flourish. Early summer heatwaves quickly dried them out, leaving behind endless fire fuel. Then dry lightning storms rolled in, sparking a slew of natural fires alongside human-caused ones.

Oregon’s drier east side was hit the hardest. Many landowners there pay the Oregon Department of Forestry for fire protection through a per-acre annual fee based on what kind of land they have and where it sits. Those fees go toward the state’s firefighting costs on private and public lands. Because a large chunk of 2024 wildfires burned on state-protected lands, the state saw a higher-than-usual bill.

In the end, Oregon spent a whopping $350 million fighting fires across the state.

Every year, Oregon fire officials hire a suite of contractors for wildfire response — not just specialized firefighting companies, but also businesses that provide ancillary services such as portable outhouses and food catering.

The Oregon Department of Forestry, which handles the bulk of the state’s wildfire response, can usually pay contractors within a couple of months. But this year’s costs far exceeded what the state had on hand as it awaited federal reimbursements.

The federal government helps pay for wildfires through disaster funds. It also reimburses the state whenever Oregon lends firefighting support on federally managed fires. But it can take years for those federal dollars to make their way to Oregon.

Gov. Tina Kotek called a special session to more quickly pay this year’s contractors. On Thursday, lawmakers are expected to send $218 million to state fire agencies to pay their pending wildfire tabs for 2024.

Oregon uses a complicated formula to pull wildfire funds from multiple sources, including landowners, insurance, timber taxes and the state’s all-purpose general fund.

A 2021 report commissioned by the state called the system “arguably the most complex wildfire funding structure in the country.”

There are two primary buckets of Oregon’s wildfire funding: “base protection” and “emergency.”

The base protection bucket is jointly funded by landowners and the general fund. Public and private landowners pay per-acre fees based on their location and land type — like if they are timber or grazing lands. The Oregon Department of Forestry, in turn, is charged with providing an “adequate level of protection” on those lands. Most of the land the department protects is privately owned.

If fires grow large enough to exceed basic protection, then the emergency bucket comes in. It amounts to about $20 million, which is split between the general fund and something called the Oregon Forestland Protection Fund, which gets its money from landowner assessments and Oregon’s timber harvest tax.

If annual emergency wildfire costs exceed that initial $20 million, as they increasingly do, then the general fund pays for the rest. Sometimes, state officials will opt into a private insurance plan early on if they think it’s going to be a bad year, which can help pay for this portion.

Other states' wildfire funding mechanisms are simpler in that they pull from fewer sources. A handful of other states charge landowners fees. Colorado and Utah collect money from counties. Oregon is the only state that purchases private insurance. All Western states rely on their general funds to some degree.

Oregon lawmakers put forward multiple bills earlier this year in hopes of bracing for the upcoming wildfire season. One would have asked voters if they wanted to increase property taxes to help fund wildfire protection. Another would have reinstated a tax on trees logged by private timber owners.

But those bills died, prompting the Legislature to convene a wildfire funding work group over the summer. Its members include policymakers, local officials, industry groups and tribal members. These stakeholders have met every month since June to drum up some ideas for funding wildfires that are getting bigger and costlier.

In an update to lawmakers last month, fire officials said the group has come up with about 20 ideas for potential funding solutions, but they didn’t get into specifics. Those will likely be outlined in a progress report the group is expected to publish by the end of the year.

The work group’s report could become a roadmap for lawmakers as they brainstorm new bills to put forward next session.

Wildfires have long been part of Oregon’s ecosystems. They help diversify wildlife habitats by clearing some tree canopy and underbrush, allowing new plants to grow. Many wildlife species, like woodpeckers and some fish species, need some degree of fire for food and habitat.

But decades of aggressive fire suppression has resulted in unhealthy, crowded forests that are more prone to extreme, high-severity fires. Hotter, drier temperatures from climate change have made matters worse.

The result: Bigger and more catastrophic wildfires. The average number of acres burned in Oregon has been rapidly increasing. By 2014, the state’s 10-year average increased by 64%. By this year, it increased another 57% percent.

As fires get bigger, they can spread into areas where people live, like with the 2020 Labor Day weekend fires, which destroyed upwards of 5,000 homes and businesses in Oregon.

More destructive wildfires are just one way in which climate change is making natural disasters worse. Oregon, like much of the world, is dealing with the compounding effects of heavier rain, floods, landslides and heat waves. These will continue to put pressure on public resources in a myriad of ways, including straining governmental budgets.