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Tentative Report on
Economic Effects of the Rodeo/Chediski Fire
Thomas, Warren and Associates, economic and policy consultants out of Phoenix were among those who furnished, free of charge, their expertise in assisting with physical, advisory and financial assistance following the Rodeo/Chediski fire that burned about 475,000 acres and destroyed over 600 structures in the White Mountain area. Thomas, Warren's contribution was a study assessing the (estimated) economic fallout as a result of direct and indirect fire damage.
In the draft report, Thomas, Warren noted that the fire left 800 million board feet of dead timber. The Arizona Republic says 1 billion board feet.
Regardless, it's a lot of good resource. In the October 2 issue of Pioneer, Dan Adams reported that a mere 45,000 acres of timber killed by the Mt. St. Helen's eruption yielded enough timber salvaged by Weyerhauser (timber company) to build 85,000 houses. Going by that very rough estimate, the Rodeo/Chediski fire burned enough timber to build approximately 800,000 houses!
And that's not counting the trees that are still green but will likely die from injuries inflicted by drought followed by fire.
The draft report did not comment on the potential economic impact of 1 billion board feet of dead but salvageable timber.
Thomas, Warren said the more subtle impacts of the fire are its effect on the region's day to day economy (tourism, services and government), which disrupted the region's trade and commerce for 30 days at the height of its most profitable season. In addition, the loss of revenue and jobs from displaced residents, lost businesses and reduced tourism may be even more significant than the immediate physical damage.
Heber-Overgaard, as a community, suffered the most from the fire, with more than 200 residences and six businesses destroyed. Aside from the direct loss, all the White Mountain communities depend on a tourist season of perhaps five months (May-September) for the majority of their income. This year, the tourist season was gutted by the fires.
The Thomas, Warren study points out that White Mountain local governments are "heavily dependent on sales tax collections," (with the largest portion collected in the summer season). Only time will tell the direct effect of the fire on sales tax collections, but Show Low, for example, collects about $9 million annually, Eagar and Springerville close to $5 million and Snowflake/Taylor about $6 million. In St. Johns, annual sales tax collections are under $2 million. Thomas, Warren estimated that the Show Low/Pinetop/Lakeside area lost more than $1 million in sales tax revenues as a direct result of the fire. The Eagar/Springerville estimated loss is $120,000 and even towns out of the forest such as Snowflake/Taylor may be down as much as $180,000 or $190,000 in sales tax revenues. The St. Johns loss is calculated at $16,000.
"The increase in unemployment in July, 2002 due to the fire was estimated to be 21.3 percent for Apache County and 25.6 percent for Navajo County."
Thomas, Warren presented two charts of lost wages estimates as a direct result of the fire that included Heber/Overgaard (which is not incorporated). One chart is an optimistic scenario, the other a pessimistic scenario. The "optimistic" scenario estimates: Apache County lost wages of $266,400 for July, $219,800 for August and $179,800 for September.
Navajo County lost wages are estimated as $746,700 for July, $623,100 for August and $516,100 for September.
Heber/Overgaard lost wages are estimated at $17,600 for July, $15,400 for August and $13,200 for September.
The "pessimistic" scenario for lost wages in Apache County is still $266,400 for July, but $286,400 for August and $309,700 for September.
For Navajo County, the pessimistic scenario for lost wages is $746,700 for July, $804,300 for August and $867,400 for September.
Heber/Overgaard wage losses are estimated at $17,600 for July, $19,700 for August and $21,900 for September.
Small (one owner or Mom and Pop) businesses are another story. Official statistics used by government and consultants never seem to be much help in calculating small business losses, or their contributions to the economy.
The conclusions of the Thomas, Warren study are: "Perhaps the greatest opportunity for new economic growth comes from attracting retirees to the area," because "retirees have increased the commercial aspects of every region in which they locate." Also, "that while tourism is the key element to the region's economic well-being, tourism needs to be viewed as only ONE ELEMENT of the regional economic potential. The region also offers opportunity for limited technology parks... that focus on light manufacturing and assemblage... that could be developed in association with programs offered through Northern Arizona University and Northland Pioneer College."
The White Mountain region is urged by the consultants to focus on developing a "more balanced" business and employment base.
Payson.cc © 2002 Carrol Cox
Payson Arizona Editorial and Opinions on National USA / World / and Local News Issues