HOW IT WORKS

A performance-based tax credit that funds wildfire prevention phase by phase

WPTCs are modeled after proven federal tax credit programs that mobilize private capital into public-benefit projects — making verified treatment outcomes the basis for private investment.

Here's how the credit works across a full multi-phase treatment sequence:

01

Project Sponsors
Treat the Land
An eligible sponsor — state agency, tribe, NGO, utility, or collaborative — submits a multi-phase treatment plan. The Third-Party Administrator pre-authorizes a credit allocation tied to verified completion.
02

Independent Verifiers
Confirm Completion
After each phase, an accredited third-party verifier confirms the work meets standardized measurement and reporting protocols. Results are recorded in a national registry. Credits are not issued until verification is complete.
03

The IRS
Issues a Tax Credit
Upon verified completion, the IRS issues a transferable tax credit worth a percentage of eligible project costs. Each tranche is issued independently — payment flows through the tax system, not appropriations.
04

A Syndicator
Markets the Credits
Syndicators aggregate credits across projects and place them with institutional investors, including utilities, insurers, and corporate taxpayers. This intermediary structure solves timing mismatches and enables large-scale capital participation.
05

Proceeds Fund
the Next Phase
Proceeds from credit sales flow back to the project sponsor, financing the next treatment phase. The cycle repeats until the full multi-phase sequence is complete — funding the work all the way through, not just the first step.

Established precedent
WPTCs build on the design logic of existing federal tax credit programs that have mobilized private capital into affordable housing (LIHTC) and carbon capture (45Q). Modeled scenarios suggest each dollar of federal tax expenditure can catalyze approximately $3.50 of total treatment investment — a level of leverage not achievable through direct appropriations.

    LIHTC model
      A long-standing federal program that attracts private investment into affordable housing by offering predictable, tradable tax credits.
    
    45Q structure
      A federal tax credit that pays only after carbon is captured and verified, demonstrating how outcomes can be monetized through the tax system.
    
    Transferable credits
      Tax credits that can be sold to other taxpayers, allowing projects without tax liability to access private capital upfront.
    
    Fraud-only recapture
      Credits are not clawed back for performance variability — only in cases of fraud or misrepresentation — reducing investor risk.
    
    MRV registry
      Measurement, reporting, and verification standards, combined with a public registry, ensure that treatment completion is independently verified and transparently recorded.
    
  

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