Photo courtesy of the U.S. Army
Q: Which natural disaster during the past 30 years has caused the greatest loss of life and property value?
Since the 1980s, according to the National Weather Service, flooding has caused average annual property damage of nearly $8 billion and an average death toll of 94 people. In fact, flooding accounts for 90% of annual damages and loss of life associated with earthquakes, tornados, hurricanes, and other natural disasters.
Importantly, this damage and the related human tragedies would have been even higher without ongoing Federal flood control efforts, much of which centers on the country’s 100,000 miles of levees. In 2011 dollars, federal flood reduction expenditures have exceeded $130 billion over the past fifty years and this has prevented an estimated $786 billion in damages.
The U.S. Army Corps of Engineers Civil Works program receives about $2 billion annually to plan, design, construct, and operate and maintain our flood risk reduction projects. Yet our national backlog of flood risk reduction projects represents over 50% share of the currently estimated $62 billion in active backlog of the Corps’ Civil Works Program.
For the U.S. to address this significant flood risk problem adequately, we need to find new sources of funding for these necessary flood risk reduction projects – specifically through the establishment of public/private partnerships. These partnerships have successfully advanced critical surface transportation projects such as toll roads in Indiana, Texas, and Connecticut and other projects with more traditional revenue generating systems. These include hydropower development.
But we have yet to unlock the real opportunity of joining private and public investments to address flood risk reduction. There is more than $1 trillion in private sector investment funds that, with the proper incentives, could be tapped to address our growing water infrastructure backlog including flood risk reduction.
Certain communities, such as Dallas, TX, are starting to take a serious look at forming such public/private partnerships. The incentives for local communities are associated with the ability to invest now in needed flood risk reduction projects rather than waiting years or decades for public funds and in the interim, facing growing flood risks.
Since flood risk reduction projects do not have clear vendible outputs such as exist with hydropower, recreation, and navigation projects, communities have a special burden to establish solid investment strategies, including predictable rates of returns. This can include such things as flood insurance surcharges and taxing measures for property owners whose land would gain flood protection through such projects.
With growing interest in developing a Water Resources Development Act in 2013, the time is right to explore incentives for addressing our growing flood risk reduction problem. Public/private partnerships are a key step forward.
Rob Vining, Senior Advisor
Prior to joining Dawson & Associates, Rob spent a long career with the U.S. Army Corps of Engineers, including more than four years as Chief of the Civil Works Programs, Management Division.