Environmental Impact Fund Exploration
Mountain Studies has joined forces with Quantified Ventures, Ellen Roberts, and the San Juan National Forest, with backing from the US Forest Service and Walton Family Foundation, to explore the feasibility of using outcomes-based financing to increase the impact of forest health interventions around the San Juan National Forest in cross-boundary areas and within the wildland-urban interface (WUI) in a shared stewardship fashion.
What is an Environmental Impact Fund?
The Colorado Wildfire Mitigation Environmental Impact Fund (EIF) offers an approach to foster regional collaboration through a shared financing and implementation structure for cross-boundary forest health treatments in Southwest Colorado. The EIF would be capitalized by a combination of bond proceeds, grants, and appropriations, and disburse revolving loans each year to pay for forest health treatments. Like other outcomes-based financing structures, the EIF hedges performance risk and ties payments to the success of projects.
In the proposed structure, beneficiaries of forest health treatments (or “outcomes payors”) repay individual revolving loans from the EIF based on validated wildfire risk reduction outcomes. Including multiple outcomes payors would minimize the financial burden of any one payor. The fund model allows for long-term maintenance and expansion of forest health treatments into the future.
Why do we need an EIF and what does it address?
Past fire suppression policies, drought conditions, and beetle-infested forests have increased the threat of wildfire for the people, resources, and industries of Southwest Colorado. Forest health treatments like thinning and prescribed burns can reduce this risk, but a coordinated, well-funded, and landscape-scale treatment program has yet to be implemented. While fire is a threat that cuts across jurisdictions, most of the mitigation work to date has been done within the San Juan National Forest. The region has lacked funding and coordination through existing means the funding to support a comprehensive, regional implementation of forest health treatments on cross-jurisdictional areas in the Wildland-Urban Interface (WUI) owned by the state, local governments, and private landowners.
What is the expected approach?
To meet these challenges, a collaborative team consisting of Quantified Ventures, the Mountain Studies Institute, Treatments covering this amount of land also provide the opportunity to generate a large, long-term supply of woody biomass material, which could foster the growth of a local biomass utilization industry for electricity, thermal energy, biochar, or other wood products.
For more information on the project, visit Quantified Ventures.