(Covers information from the S.D. Perry novels)
The Raccoon City outbreak (tentative name) was a viral outbreak of the T-Virus, which ravaged the city of Raccoon City, Pennsylvania.
The cannibal killings
When the Spencer Mansion was destroyed, the police noticed a sudden stop in the murder incidents. Chief Brian Irons commented in an issue of Cityside (dated August 3) that the killers may have been hiding out there and that they have since left the Mountains. Regardless of the apparent end to the killings, the curfew in the city was still under effect, and all under-18s were still not allowed out after dusk.
The city was destroyed in a widespread fire on Sunday October 6, 1998, with the external media believing the blazes to have killed as many as seven thousand residents. The family members of those who were caught up in the fires stayed in the nearby Mountain community, Latham, where they awaited news of their loved ones' fate. Over the next few days, General Martin Goldmann granted permission for firefighters to recover bodies from the debris, and seventy-eight survivors were pulled out of the debris in the first two days. These people, according to a news report on the day, were found to be suffering from an "illness" (zombification) and were transported to an undisclosed facility. Along with the zombified survivors, the recovery teams discovered a number of corpses that had been left relatively-intact during the fires, which suggested to the public that the fire wasn't the only cause of the deaths, due to the frequency in bodies found with gunshot wounds.
On October 10, "Nationwide Today" reported that the death toll had been reduced from the previous estimate of 7,000 to 4,500. A link between the pre-fire chaos and the illness being quarantined was made more likely when Umbrella, Inc. offered to assist in any investigation into if one of its chemical labs had inadvertently leaked into the city. By the morning, there had been 142 recovered survivors: forty-six were found uninjured but were suffering from some sort of mental breakdown (a suggestion of zombification); seventy-nine were severely injured and had to be operated on, and seventeen were found with light injuries.
On October 18, a newspaper produced a story suggesting a conspiracy regarding the outbreak (printing the death tally as 7200 - far above the previous, downgraded estimate). In their theorization, Chief Brian Irons was angered by Mayor Devlin Harris' insistence that the S.T.A.R.S. unit be disbanded after an inquest after the Mansion incident suggested that Bravo Team was intoxicated and crashed (and subsequently published a fake story about Umbrella being to blame for it) during a murder investigation in the mountains. Reacting over the top, he was suspected of conspiring with the S.T.A.R.S. survivors to occupy an Umbrella chemical plant and take its personnel hostage, threatening Harris with the plant's destruction if his financial demands were not met. This theory blatantly refused, thanks to Umbrella's control of the media, to accept the possibility of their being a link between the cannibal murders in June and the cannibal murders in October.