Gov. Jerry Brown warns 'new normal' of wildfires could bring fiscal stress for California

Key Points
  • California Gov. Jerry Brown said the state has sufficient funds to pay for firefighting costs from the more than dozen large wildfires raging in the state.
  • But the governor cautioned a downturn in the economy is inevitable at some point and could change the state's fiscal situation and require borrowing for such emergencies.
  • Brown also called the wildfire situation in California "the new normal that we have to face."
California Governor Jerry Brown
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California Gov. Jerry Brown on Wednesday called the wildfire situation in the state part of "the new normal." He said California has the money to fight fires today, but cautioned things could get tighter in coming years due to a likely downturn.

More than a dozen major wildfires are burning in the state, including the monster Carr fire in Northern California that has already destroyed more than 1,000 homes and killed six people. Seventeen large fires have burned more than 250,000 acres and thousands of residents still are evacuated.

"So far, this fire activity is a small part of our very large budget but it is a growing part and will continue to grow as we adapt to the changing weather," Brown said during a news conference about wildfires at the State Operations Center in Mather, California.

Through last Friday, California had already spent $115 million on emergency firefighting since the start of the July 1 fiscal year, or about one-fourth of the state's $442.8 million annual so-called e-fund budget. However, if the state's fire costs exceed its e-fund budget in fiscal 2018-19, California can tap into its traditional budget reserves.

"There's money in this year's budget," Brown said, noting that the state is experiencing its ninth year of recovery. "We have a rainy day fund. We're not down to our last dollar at this point."

However, the governor conceded that the state will at some point experience a downturn in the economy that likely will change its fiscal situation. When that happens, he said the state could resort to borrowing if needed.

More destructive fires and more billions spent

"Things will get much tighter in the next five years as the business cycle turns negative and as the fires continue," Brown said. "Maybe the fires will pause for a year or two, but over a decade or so we will have more fire, more destructive fire, more billions will have to be spent on it."

Still, even when the state's fiscal situation gets "tough," he said, "there's always available borrowings" the state can tap to get funds.

More than 13,000 firefighters currently are on the lines battling the large wildfires across California, state officials said Wednesday. They also said California has reached out to other states as far away as Maine and to other countries for fire assistance.

"There's a tremendous effort fighting these fires," Brown told reporters. He also called the fire situation "the new normal that we have to face."

The Democratic governor, a critic of President Donald Trump, was asked if he's had contact with anyone in the administration about the fire situation. Brown said he was in contact this past week with Homeland Security Secretary ‎Kirstjen Nielsen to discuss the wildfires. "It's always pleasant when I talk to her," Brown said. "She's a very congenial interlocutor."

As for the Carr fire, crews have been making progress on the blaze about 220 miles north of San Francisco. The fire in Shasta and Trinity counties has already charred more than 115,000 acres and was 35 percent contained Wednesday morning.

Other large wildfires in Northern California include two blazes in and around the Mendocino National Forest. Together, the two Mendocino region fires have burned nearly 91,000 acres and burned homes in the Scotts Valley area of Lake County.

There's also the Ferguson fire now in its 20th day burning near the Yosemite National Park as well as the arson-caused Cranston fire in Southern California. It was listed as 89 percent contained Wednesday.

Big air tankers could make a big difference

Meanwhile, California could get seven C-130H air tankers from the federal government for added firefighting capabilities under legislation approved by the Senate on Wednesday. The legislation was spearheaded by Sen. Dianne Feinstein (D-Calif.) and included as a provision in the larger National Defense Authorization Act.

The House approved a compromise NDAA last week. The defense policy bill requires the president's signature.

The seven C-130H aircraft are now in the Coast Guard fleet and under the NDAA provision would get transferred to the California Department of Forestry and Fire Protection, or Cal Fire. The Lockheed C-130 can drop almost three times the amount of fire retardant as the Grumman-built S-2 air tankers now in Cal Fire's fleet.

"This would be a big step for us," Cal Fire Deputy Chief Scott McLean told CNBC. He said the agency's current S-2A tankers can drop about 1,200 gallons of fire retardant and the C-130 is capable of roughly 4,000 gallons of retardant so it would allow the agency to pack more punch from each drop.

A California Air National Guard C-130 plane fitted with a firefighting system dropped fire retardant Tuesday on the Carr fire. The Nevada National Guard this week also deployed two of its C-130 aircraft fitted with special firefighting equipment to help combat wildfires in California.

Cal Fire currently has 22 air tankers in its fleet as well as a dozen helicopters and 17 air tactical aircraft. McLean said Cal Fire's aviation assets are set up as an initial attack and located throughout the state, which has allowed the agency to keep most wildland fires to 10 acres or less.