Business in San Diego County came to a crawl during the devastating fires that started burning up vast areas of the region on Oct. 21. While no one yet knows what the full economic impact will be when the smoke clears, some business leaders are venturing some guesses.
“The business community knows that it will have a huge impact,” said Sandy Rees, president and chief executive officer of the San Marcos Chamber of Commerce, and president of the North County Chamber Executives. “Even if they are open, they are not doing business. It will take a recouping of the whole region. Let’s just say that it will be an interesting last quarter.”
The county estimates the cost of the fires at more than $1 billion. And, with more than 560,000 residents evacuated from their homes in the past week, many taking refuge at temporary shelters around the county, and traffic curtailed, there has been no business as usual.
According to information supplied by the county on Oct. 24:
– The Witch Fire, in the Witch Creek area east of Ramona , with 70 percent of its area inspected , is expected to suffer the loss of 545 homes, 230 cars and 175 outbuildings, for an estimated loss of $251.8 million.
– The Rice Fire in the Fallbrook area, with 100 percent of its area inspected, destroyed more than 200 homes, two commercial properties, 40 outbuildings, 20,000 avocado trees and 91 cars, for an estimated loss of $60 million.
– The Harris Fire had moved to the northeast, threatening structures from Jamul to the east, and to the Jamacha community to the west. Based on a 55 percent inspection of the area, 155 homes, two commercial properties, 17 outbuildings and 120 cars were destroyed, for an estimated loss of $53.5 million.
Rees said communication will be key for businesses. “We will keep them posted on what we can do for the business community,” she said. “We will be on top of it. Nobody is living in a vacuum.”
Luanne Hulsizer, president and CEO of the Poway Chamber of Commerce, said that retail and restaurant trade probably will be impacted for a few days.
“But we foresee a positive for the economy,” she said. “This will provide opportunities in rebuilding in the community, and retailers here are looking to provide discount opportunities for our residents that were affected.”
Meanwhile, said Hulsizer, “We will be working in conjunction with the Economic Development Department in the city. We were breaking out our ‘Shop Poway’ campaign for the winter. After the first of the year, we will reassess to see if the fires have impacted those sales.”
Gary Knight, president and chief executive officer of the San Diego North Economic Development Council, in San Marcos, said that businesses seem to be reacting to the crisis in their own ways.
“You go down the street and see a Starbucks closed, and a Home Depot open,” he said. “It hasn’t had a uniform impact.”
In some areas, the impact will come less from actual fire damage, than it will to displaced workers unable to report to work, traffic restrictions and the subsequent absence of shoppers.
“We are going to be there to help the businesses, or those displaced workers who want to get back to work,” said Knight. “Then we’ll start an assessment of damages. The community has been fantastic.”
Echoing that sentiment was Harvey Mitchell, chief executive officer of the Escondido Chamber of Commerce.
“We came through pretty well,” he said. “We will come back from this like we always do. People have a good attitude here, and are willing to help. Everybody chips in.”
Ted Owen, president and CEO of the Carlsbad Chamber of Commerce, said that the fires shouldn’t have an adverse impact on the area’s golf manufacturing, biotech and high-tech businesses, though agriculture would likely take a hit.
As for how this crisis was handled, compared with the 2003 fires, Owen said, “It’s a 100 percent better effort. There was more cooperation and the 911 reverse system worked very well.”
Jim Baumann, chief executive officer for the Vista Chamber of Commerce, also recalled those 2003 fires, when he was heading up the Poway chamber.
“It seemed like business rallied, with restaurants donating food, and grocery stores helping out,” he said. “They all felt that the impact on them was so minor, compared to people who lost homes in the fires. I think the same thing applies now.”
Like Owen, Baumann gave high marks to how the current crisis is being handled.
“People out on the front lines say that the weather and fires actually are worse this time,” he said. “It seems that, so far, the damages, in terms of loss of property and life, have been far less. It shows that we learned a lot from ’03.”
Some good news was announced Oct. 24 for the fire-ravaged constituents of county Supervisors Dianne Jacob, 2nd District, and Bill Horn, 5th District. They won the unanimous green light from their board to waive permit fees for those needing to rebuild in the unincorporated areas of the county, and received approval for an expedited building process for fire victims.
Also on Oct. 24, Gov. Arnold Schwarzenegger heralded the major disaster declaration issued by President Bush for California. This will mean millions of dollars in assistance to help residents and businesses rebuild and recover, said the governor.
Included will be low-interest loans from the U.S. Small Business Administration, grants for temporary housing, home repairs and disaster unemployment assistance.
Assessing The Damage
Meanwhile, the San Diego Regional Chamber of Commerce wants answers. In the coming days, it will be sending out a survey to thousands of businesses, asking about their experiences in the fires, and recommendations on how to handle future emergencies.
Scott Alevy, the chamber’s vice president of public policy, is especially interested in how the smaller operations fared.
“Over half of the chamber’s members have less than 10 employees,” he said. “We want to know how this affected mom and pop liquor stores, hamburger stands, taco shops, and small offices with 30 employees versus the large corporations.”
While it’s difficult to assess the long-term damage to the region at this point, some things are known, Alevy said.
“From a business standpoint, there has been a tremendous impact, because the normal corridor of trade has been impacted,” he said, referring to the temporary shutdowns of Interstate 5 last week, as well as other vital roads in the county. “This will have a tremendous impact on the economy.”
Alevy also lauded the response to the current crisis.
“We had much better coordination of public safety entities, and we were able to get the military involved earlier,” he said. “It can always be better, but this saved a lot of property and lives. I think that our leadership responded well in a crunch.”
In agreement was Julie Meier Wright, president and CEO of the San Diego Regional Economic Development Corp., which helps businesses expand in or relocate to the area.
“Everybody is doing a magnificent job,” she said. “Look how seamless and effectively we have responded, how well the shelters are working for San Diegans. We are showing some of the best of San Diego to the rest of the world.”
A reported 15,000 evacuees were encamped at Qualcomm Stadium at one point , dwindling down to about 500 by Oct. 25. The emergency shelter was stocked with everything from free bottles of water and sunscreen, to camp chairs, blankets, pillows, food and beverages. Business had set up booths to offer both aid and comfort, and some practical assistance.
“We’ve been at all the rescue sites, settling claims on the spot,” said Adrian Gammal, a life insurance specialist with Farmers’ Insurance Group’s Carlsbad-based state office. “We’ve been giving out checks of up to $5,000 for relocation costs.
Customers didn’t have to come armed with their paperwork, thanks to Farmers’ fully high-tech tricked-out RV, said Gammal. “We (could) look up the policies on-site.”
Gordon Liu, a fire claims representative for the State Farm Insurance office in Mission Valley, said that a lot of people dropping by his booth wanted basic information.
“We help them with submitting claims, and anything else they need,” he said. “We explain how their policy works. We try to be consoling.”
Leap Wireless International Inc., which offers the Cricket flat-rate wireless service, had a booth nearby where people could make free calls in the United States and charge their cell phones.
“We had to close a lot of our stores because of the fires,” said Luis Gonzalez, an account representative. “We wanted to provide phones, so people could call their loved ones.”