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DHS FEMA NFIP Services - eWaterwark Article
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Mitigation Saves
Michael McFadden, NFIP Bureau and Statistical Agent
An independent study released in December 2005 has yielded research-based
proof of what federal, state, and community natural hazard mitigation officials
have long known through hands-on experience: FEMA's natural hazard mitigation
initiatives really work! The study also proved that FEMA's mitigation initiatives
more than pay their own way by producing significant monetary savings for
society at large and for the U.S. Treasury, both of which translate into
direct savings for taxpayers.
The study was undertaken as a result of a Congressional mandate for FEMA
to commission "an analytical assessment... [of] the degree to
which mitigation activities will result in future 'savings.'" Although
the study was commissioned and funded by FEMA, it was conducted independently
of FEMA by the Multihazard Mitigation Council (MMC) of the National Institute
of Building Sciences (NIBS).
More than 50 national experts in a variety of disciplines participated
in the study. They represented NIBS member organizations and other professional,
scientific, and academic organizations. Their formal objective was to
"quantify the future savings (in terms of losses avoided) from hazard
mitigation activities related to earthquake, wind [hurricanes and tornados],
and flood that are funded through three major natural hazard mitigation
grant programs (the Hazard Mitigation Grant Program, Project Impact [1997-2001],
and the Flood Mitigation Assistance Program)" during the 10-year
period 1993-2003.
The Preface of the MMC report stated that "FEMA grants to mitigate
the effects of floods, hurricanes, tornados, and earthquakes between 1993
and 2003 are expected to save more than 220 lives and prevent almost 4,700
injuries over approximately 50 years." In a reference to the massive
property damage, recovery expense, and human suffering caused by Hurricanes
Katrina, Rita, and Wilma last year, the Preface also noted that "Recent
disaster events painfully demonstrate the extent to which catastrophic
damage affects all Americans and the federal treasury."
The report was released to Congress and the public during a December
19 press conference at the National Press Club in Washington, DC, attended
by reporters, members of Congress, members of NIBS, FEMA officials, and
numerous others. Brent Woodworth, MMC chairperson and manager of IBM's
worldwide Crisis Response Team, told those present that "For years,
there have been anecdotal reports, but this information gives policymakers
the evidence that proves that mitigation is a worthy investment in our
nation's safer future."
David Maurstad, Director of FEMA's Mitigation Division, which administers
both federal natural hazard mitigation initiatives and the NFIP, noted
that "We've all seen that mitigation helps to save lives and reduce
property damage. But until the MMC study, we haven't had independent,
objective, quantitative data analysis to show that building stronger and
safer is also a sound investment."
Methodology
The independent MMC study proceeded along two parallel tracks. The first
track examined a "statistically representative sample of FEMA-funded
mitigation grants so that results could be generalized for the entire
population of FEMA mitigation grants." This random-sample research
track focused on the effectiveness of individual mitigation grants awarded
by the three studied mitigation grant programs.
The second track examined a blindly selected sample of eight communities
that had received FEMA mitigation grants and that represented "predetermined
demographic categories." This empirical research track focused on
the effectiveness of broad-based community mitigation grant programs.
The MMC's two-volume report is titled "Natural Hazard Mitigation
Saves: An Independent Study to Assess the Future Savings from Mitigation
Activities," Volume I is a concise statement of findings, conclusions,
and recommendations to Congress. Volume II provides more than 360 pages
of study documentation. Both volumes are available in the MMC area of the NIBS website,
as is the 2002 "Phase 1 Report" about design parameters for the study.
Findings
The MMC study found that:
- FEMA mitigation grants "have high benefit-cost ratios"
and that "a dollar spent on mitigation saves society an average of
$4." In addition, according to the study, "a dollar spent from
the federal treasury on FEMA mitigation grants potentially saves it about
$3.65... in avoided post-disaster relief costs and increased federal
tax revenues. These results are statistically robust."
- FEMA community mitigation grants "are cost-effective, often
leading to additional non-federally funded mitigation activities, and
have the greatest benefits in communities that have institutionalized
hazard mitigation programs."
Furthermore, mitigation officials in the eight communities selected for
empirical analysis concurred in their conviction that "the [FEMA]
grants permitted their communities to attain [through non-federal matching
grants] mitigation goals that might not otherwise have been reached"
and produced, in addition to quantifiable benefits, "increased community
awareness, esprit de corps, and peace of mind."
Conclusions
On the basis of the study's findings, the MMC Board of Direction concluded
that:
- "Mitigation is sufficiently cost-effective to warrant federal
funding on an ongoing basis both before disasters and during post-disaster
recovery.
- "Mitigation is most effective when it is carried out on a
comprehensive, community-wide, long-term basis.
- "Continuing analysis of the effectiveness of mitigation activities
is essential for building resilient communities."
Recommendations
Noting that the study's results provide "conclusive evidence that
natural hazard mitigation activities are of benefit to the nation as a
whole and are a cost-effective investment of federal funds," the
report presented three recommendations of the MMC Board of Direction for
federal government policymakers:
- "Invest in natural hazard mitigation as a matter of policy
on an ongoing basis both before disasters occur and through federally
funded disaster recovery and rebuilding activities and programs;
- "Support mitigation activities that will increase the resilience
of communities by increasing knowledge and promoting institutional commitments
to mitigation at the local level; and
- "Support ongoing evaluation of mitigation by developing a
structured process for assessing the performance of buildings and infrastructure
after all types of natural disaster and by measuring the benefits that
accrue from process mitigation activities."
Losses to Society Avoided
The MMC mitigation study defined "benefits" of mitigation as
"losses to society avoided." The following benefits were identified
by the study:
- "Reduced direct property damage (e.g., buildings, contents,
bridges, pipelines)
- "Reduced direct business interruption loss (e.g., damaged
industrial, commercial, or retail facilities)
- "Reduced indirect business interruption loss (e.g., ordinary
multiplier of 'ripple' effects)
- "Reduced nonmarket damage (e.g., environmental damage to wetlands,
parks, and wildlife and damage to historic structures)
- "Reduced human losses (e.g., deaths, injuries, homelessness)
- "Reduced cost of emergency response (e.g., ambulance service, fire
protection)"
Michael McFadden has worked with flood insurance for more than 8 years
as a member of the NFIP Bureau and Statistical Agent's Department of Technical
Assistance and Communications.
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Friday, 21 January 2011 |
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