This paper examines the importance of environmental factors (mosquito pools and home foreclosures) in human West Nile virus (WNV) transmission in California and Colorado. The role of environmental factors is investigated by applying an instrumental variable technique to a spatial filtering random-effects negative binomial model to correct for both spatial autocorrelation and endogeneity. The results suggest that mosquito pools and home foreclosures are significant in explaining the prevalence of human WNV. An innovative aspect of this research is that it emphasizes the role of home foreclosures in WNV transmission and in the allocation of resources. Knowledge of the factors associated with WNV prevalence is crucial for abatement of future outbreaks. The results suggest that more resources should be allocated to areas that have a high number of home foreclosures and mosquito pools for surveillance and mitigation of the disease.