Residents of the Cottage Grove neighborhood in Houston, Texas watch as floodwaters surround their house in August 2017.

Residents of the Cottage Grove neighborhood in Houston, Texas watch as floodwaters surround their house in August 2017. Scott Olson/Getty Images

Analysis

As Climate Risks Worsen, U.S. Flood Buyouts Fail to Meet the Need

The U.S. approach to buying out properties vulnerable to flooding is rife with uncertainty and delays. Now, as climate change drives more extreme coastal storms and precipitation events, the system must undergo a drastic overhaul or risk stranding millions in flood-prone homes.

After historic floods in October 2015, residents of the Shadowmoss neighborhood in Charleston, South Carolina decided they’d had enough and were ready to move elsewhere, out of harms way. In response, Charleston officials applied to the Federal Emergency Management Agency (FEMA) for more than $10 million to buy out 48 homes.

Little did the residents of Shadowmoss (or city officials) know that four years would go by before this effort would be completed. Charleston’s application for funding wasn’t approved by FEMA until October 2017. After the requisite reviews were finally completed, all the homes were purchased, but demolition was not completed until the summer of 2019. In the meantime, the neighborhood had experienced a total of four major flooding events in three years.

Such waits are all too typical, with the majority of FEMA-financed buyout projects taking more than five years to complete. These delays are a major obstacle to the effort to move people out of the growing number of areas vulnerable to flooding, rising sea levels, and other effects of climate change.

What the residents of Shadowmoss experienced is what passes for managed retreat today in the United States. Managed retreat is a long-term process that involves the deliberate unbuilding of vulnerable areas and the subsequent relocation of people, homes, businesses, and infrastructure. As climate change increases the risks of flooding, sea level rise, and other hazards, more people will need such assistance to relocate, and there will be an increasing urgency to provide it, often in the form of buyouts.

There’s an enormous gap between what FEMA’s programs can support and the number of people likely to want and need a buyout.

But the current federal policy, planning, and financing processes that support home buyouts are time-consuming, rife with uncertainty, and full of ambiguity, and can leave people in purgatory.

FEMA is (and will continue to be) one of the primary sources of buyout funding, but its programs are already struggling to provide buyouts in a timely fashion in the aftermath of today’s flood disasters.

Over the past 30 years, FEMA has supported buyouts of more than 43,000 properties. At that pace, FEMA’s current programs would support about 130,000 more buyouts over the next 90 years. But that’s a drop in the bucket compared to the projected 13.1 million Americans who could see their homes inundated by six feet of sea level rise in coastal areas by the end of the century. And millions more along the nation’s rivers and inland floodplains may need to move out of increasingly flood-prone areas as extreme precipitation events increase.

Given climate forecasts, the current scale and pace of buyouts leaves an enormous gap between what FEMA’s current programs can realistically support and the number of people likely to want and need a buyout in order to relocate to safer areas.

A for-sale sign in the front yard of a home damaged by flooding from Hurricane Florence in Conway, South Carolina in February 2019.

A for-sale sign in the front yard of a home damaged by flooding from Hurricane Florence in Conway, South Carolina in February 2019. AP Photo/Sean Rayford

In their current form, FEMA’s programs are not capable of scaling up to deliver the needed assistance. And if these are the best tools the nation has to conduct managed retreat, then managed retreat will, quite frankly, be unmanageable.

Among other things, what’s needed is a fundamental shift in thinking. Many federal, state, and local officials have worked tirelessly on buyout projects, but too often these are executed as one-and-done efforts. Localities apply for funding, buyouts are completed, and the grants are closed. Lessons learned are not applied to the next project, because either there isn’t a next project in that community or what was learned has been forgotten by the time the next project occurs. The way many communities and states conduct these projects is tantamount to re-inventing the wheel each and every time. This inefficient cycle is well described by Alex Greer and Sherri Brokopp Binder in their aptly titled research paper, “A Historical Assessment of Home Buyout Policy: Are We Learning or Just Failing?

In fact, vulnerable communities and states need to transition from conducting buyout “projects” to administering buyout “programs” that are guided by long-term thinking, careful planning, true community engagement, and a focus on equity. Research has found that these projects are generally implemented by whiter, wealthier communities, who have the capacity to take on the process of conducting buyouts using FEMA funding and jumping through the numerous bureaucratic hoops involved.

We need programs that are able to function at a much larger scale and on a much faster timeline that is consistent with climate projections and the managed retreat that will be required.

A timeline of FEMA-funded buyouts over the past 30 years. Buyouts peaked in 1993 following historic flooding in the U.S. Midwest.

A timeline of FEMA-funded buyouts over the past 30 years. Buyouts peaked in 1993 following historic flooding in the U.S. Midwest.

My team at the Natural Resources Defense Council (NRDC) has examined buyout programs that used FEMA funding in the U.S., which, over the past three decades, have totaled more than 43,000 properties and 3,839 buyout projects in 1,016 counties in 49 states. In addition to addressing issues of timeliness and equity, another key challenge is helping smaller communities, which can find buyouts to be daunting. Dennis Knobloch, the former mayor of Valmeyer, Illinois (a community that relocated out of the Mississippi River floodplain after the Great Flood of 1993) points out that “wandering through the myriad of government policies requires a full-time staff, and most small communities with part-time elected and appointed officials are not equipped for such an endeavor.”

As the federal government and communities face the prospect of managed retreat, they can look to a number of successful buyout initiatives. One of them is New Jersey’s Blue Acres program. Started in 1995, it uses dedicated state funding, staff, and resources to conduct buyouts on behalf of the state and local communities. It leverages federal dollars when they are available. After Hurricane Sandy hit in 2012, the program expanded its efforts considerably. As of last September, Blue Acres has spent $375 million on buyouts to purchase almost 1,000 properties. The typical buyout takes six to 12 months from start to close, with demolition of the property six to12 months after that.

Located nearly 200 miles from the coast, the region around Charlotte, North Carolina has flooding that is often linked to the inland effects of coastal storms. Since 1999, Charlotte-Mecklenburg Storm Water Services (SWS) has purchased 460 properties at a cost of $67 million. Frustrated with the process of securing FEMA grants for buyouts, SWS created its own self-financed buyout program that is supported almost entirely by local stormwater fees; it currently spends about $4 million annually. Now buyouts are completed in a relatively quick and efficient process that can take just a few months to complete.

Many homeowners give up as the years pass and they continue to live with the threat of another flood damaging their homes.

The programs in New Jersey and North Carolina demonstrate two key factors in successful buyouts: making sure the option is presented soon after a flood and ensuring that the purchase of a person’s home happens quickly once the process is set in motion. As Valmeyer’s former mayor Knobloch recounts, “Those who have lost their homes and businesses are looking for answers as soon as possible.”

For those interested in a buyout, many simply give up as the months and years pass by and they continue to live with the threat, and often the reality, of another flood damaging their homes. That’s been the experience of thousands of homeowners in Houston and Harris County, Texas in the aftermath of 2017’s Hurricane Harvey, which killed 68 people, caused $125 billion in damages, and destroyed or damaged an estimated 204,000 homes.

An investigation by the Houston Chronicle found that people opted to sell their flooded homes to real estate speculators for a fraction of their pre-flood value because they couldn’t bear to live with the trauma of flooding again. Many had applied for a publicly financed buyout, but could not wait for it to materialize. The result has been a lost opportunity to permanently remove properties from at-risk areas. Instead, a dangerous game of musical chairs is perpetuated, where one owner leaves after taking a loss on the house and another moves in. The only winner is the speculator who made a profit flipping a flood-prone property.

Despite these challenges, flood-weary residents are still asking for buyouts, and localities are trying to make them an option. In February 2020, six states are expected to have applied for their share of $6.875 billion in federal climate resilience funding available from the Department of Housing and Urban Development (HUD). Most of those states, if not all of them, are dedicating sizable portions of that funding for buyouts. But as currently proposed, those will look similar to the buyouts we’re all too familiar with. They’re being offered months, or years, after a flood disaster. And they’ll be pursued as one-off projects that will purchase homes and then close up shop. Few of these states are building the long-term expertise necessary to carry out a program that outlives the availability of HUD’s funding. And that’s a huge missed opportunity.

A home in Sayreville, New Jersey being demolished in 2014 as part of the state's Blue Acres buyout program.

A home in Sayreville, New Jersey being demolished in 2014 as part of the state's Blue Acres buyout program. Rosanna Arias/FEMA

Buyouts are just one piece of the managed retreat puzzle, but they’re an essential one. If we aren’t able to provide timely and equitable assistance to those who need it to move out of harm’s way, then we don’t have managed retreat – it’s more similar to a domestic refugee crisis.

And we may be seeing the first signs of that. According to the Internal Displacement Monitoring Centre, 1.25 million Americans were displaced by disasters in 2018 alone. While most of these displacements were temporary, tens of thousands of people in the United States have been permanently displaced by climate-driven disasters.

Nobody wins with these kinds of large-scale, unplanned displacements. Certainly not the individuals displaced, who have left their homes and communities behind. But the communities who lose residents are also diminished by the loss of workforce and talent, of taxpayers and neighbors. Communities that recognize the long-term challenges associated with climate change and take proactive steps to adapt will be much better prepared to retain population while moving residents away from danger.

True managed retreat efforts should include three common features. First, the public acquisition and unbuilding of vulnerable areas. Second, re-establishing people, homes, and businesses in safer locations, ideally in the same or an adjacent community. And, finally, the re-use of the newly acquired public lands for projects that further lower risks, such as rebuilding or restoring wetlands, and that provide access to green space.

Without such reforms, the nation’s buyout efforts will continue to fall short of what will be needed in the coming decades.

NRDC, where I work, has been pushing new ideas for buyouts that could make them more equitable and more efficient, including reforming the National Flood Insurance Program to allow it to offer timely buyouts to property owners when it doesn’t make sense to rebuild again and again.

Unless such reforms are enacted and other improvements made, the nation’s buyout efforts will continue to fall short of what will be needed in the coming decades. And that will leave property owners highly vulnerable, forced to fight for the resources they need to get out of harm’s way.

Such was the case for Olga McKissic after her Louisville, Kentucky home flooded multiple times. “After the April 2015 flood,” she said, “that’s when I knew: ‘I’m not going to stop until I get this buyout. You’re going to know who I am, and you’re going to feel my pain, and you’re going to see my face.’ I wasn’t just fighting for myself. I was fighting for my neighbors, too. Someone on my street had already received a buyout, so I knew it was possible.”

She received one in November 2018, but not until her home had flooded a fifth time while she waited to find out if FEMA would approve the grant that allowed her home to be purchased.

A Houston neighborhood flooded in the wake of Hurricane Harvey in August 2017.

A Houston neighborhood flooded in the wake of Hurricane Harvey in August 2017. Marcus Yam / Los Angeles Times via Getty Images

It should not be a grueling process to get assistance to relocate to higher ground, especially when it would be less costly to taxpayers to offer a buyout, rather than having the National Flood Insurance Program pay to rebuild a property over and over. FEMA, which provides the bulk of financial assistance for buyouts, is acutely aware of the problem. In the aftermath of Hurricane Harvey, Roy Wright (then a FEMA deputy associate administrator) said, “I’m working with my team and lawyers on ways I can move [buyouts] to the front. The point is, I’m not going to pay someone to redo their house, then re-buy it.”

But that is exactly what FEMA is required to do — pay someone to redo their house, then re-buy it later — under the current policies and programs that we have to rely upon to support managed retreat.

Instead we need to be able to present the option of a buyout as soon as a flood happens, or better yet, months or years before the next flood occurs. To do that, communities, states, and the federal government need to recognize the need for a managed retreat strategy. That takes foresight and planning, and it requires communities to begin having conversations about the future and the options that they want want to make available to their residents.