Physical Impacts and Policy Implications of Hurricane Florence

Hurricane Florence has reiterated what was already proven last year by Hurricanes Harvey, Irma, and Maria: America’s infrastructure is not prepared to withstand major natural disasters. 

Only two years ago, Hurricane Matthew struck a similar area as this year’s Florence, in the southeastern United States, killing 34 people and inflicting around $10 billion dollars in damage. To date, 51 people have died as a direct result of Hurricane Florence—three in Virginia, nine in South Carolina, and 39 in North Carolina. Over four days, the massive storm deposited 10 trillion gallons of rain across 14,000 square miles, with rainfall accumulating to an average height of 17.5 inches and peaking at nearly 36 inches in Elizabethtown, North Carolina. The storm has been recorded as the second wettest on record, only rivaled by 2017’s Hurricane Harvey deluge over the Houston area.  

While the total costs of the hurricane are still being tallied, current estimates of the damage and economic losses range between $30 billion and $50 billion. An estimated 700,000 homes have been affected, with more than 51,000 homes directly impacted by storm surge alone. But the effects of a disaster can linger long after a storm passes. A recent report from CoreLogic found that, within months of the storms, areas affected by the 2017 hurricanes and wildfires saw the rate of mortgage delinquencies and rent increases double and even triple. 

The risk modeling company RMS has estimated that Hurricane Florence has caused between $2.8 and $5 billion in insured losses, with between $800 million and $1.2 billion coming out of the federally-backed National Flood Insurance Program (NFIP). However, between 70 and 85 percent of the flood damage from the storm is estimated to have occurred to uninsured properties. As BPC has previously discussed, NFIP is in desperate need of reform. From faulty floodplain maps to a broken rate model, the NFIP does not adequately protect Americans from the increasing risk of natural disasters.  

Infrastructure 

Here is a quick run-down of some of the physical infrastructure that was affected by the storm. 

• Power. 1.4 million customers lost power as the high winds tore down electrical lines. As electrical systems go offline, a variety of interconnected infrastructure can be adversely affected, including communications networks and water treatment systems. 

• Dams. South Carolina has 178 “high hazard” dams, or any dam where a loss of human life is likely if the dam fails, or serious damage is likely to occur to homes, industrial and commercial buildings, important public utilities, primary highways, or major railroads. Notably, for the 2,400 regulated dams in South Carolina, there are 20,000 unregulated dams that are not subject to oversight and evaluation from the state. North Carolina has 1,445 dams statewide—185 of which are listed as in a poor or unsatisfactory condition. During Hurricane Florence, at least a dozen dams failed in South Carolina, and at least two dams were breached in North Carolina.  

• Drinking Water and Wastewater. Several wastewater systems have been overwhelmed in the affected areas, including a catastrophic failure of the wastewater treatment system in coastal Onslow County, NC, which was inundated by a storm surge. As Vox’s Umair Irfan summarized, “One big takeaway from all these events is that our waste management schemes are alarmingly vulnerable…” Further complicating the recovery efforts, the flooding has introduced a variety of pollutants into the environment, potentially contaminating drinking water sources, including stored coal ash and pig manure.  

• Roads and Bridges. Prior to the storm, 10 percent of the bridges in North Carolina and South Carolina were rated as structurally deficient. During Hurricane Florence, 2,200 primary and secondary roads were forced to close due to flooding.  

Reform (and More Money) Is Needed 

Hurricane Florence has, like many other recent disasters, exposed a variety of flaws in the pre-disaster and post-disaster policies of the United States. These gaps undermine the nation’s resilience, endanger residents, and further jeopardize the soundness of already aging infrastructure. For immediate recovery needs, Congress has repeatedly turned to supplemental funding as short-term fixes, but to prevent this level of destruction from reoccurring in the wake of the next disaster, there needs to be a dramatic overhaul of the national infrastructure investments and disaster framework. Spending more upfront, with a focus on increased resiliency and mitigation, saves money when a disaster hits. For every $1 spent on mitigation, an estimated $6 is saved that otherwise would have been spent in recovery costs.  

Spending on mitigation works, and thankfully Congress has started to take notice.  

Earlier this year, the 2018 Bipartisan Budget Act attempted to incentivize mitigation efforts by allowing the federal government to increase its share of recovery costs from 75 percent to 85 percent for states that have invested in mitigation projects. The current version of the Water Resources Development Act, or WRDA, which has passed the House and is awaiting a vote in the Senate, would require an assessment of the resiliency of each of the nation’s water systems (with $25 million available in technical assistance grants to conduct the assessments), and would allow the Environmental Protection Agency to create a Drinking Water System Infrastructure Resilience and Sustainability Program to annually distribute $4 million in 2019 and 2020 in grants for project that increase a system’s resilience to natural hazards.  

And most recently, the Disaster Recover Reform Act (DRRA) has just been passed in a resounding display of bipartisanship as a provision in the Federal Aviation Administration’s reauthorization bill. Along with authorizing a variety of studies and implementing several technical updates to  programs within the Federal Emergency Management Agency, or FEMA, the DRRA will allow the administration to set aside additional funding for pre-disaster mitigation projects, up to 6 percent of the total spending on FEMA disaster programs, across seven grant areas.  

For fiscal year 2018, FEMA was allocated $235 million for hazard mitigation grants. While nearly a quarter of a billion dollars is a hefty sum the United States spends, on average, between $9 and $12 billion a year on disaster relief. And in years of major disasters total spending can be significantly higher, as in 2017, when the United States spent upwards of $306 billion on disaster relief. At average levels, the DRRA’s allocation cap of 6 percent of total spending would double or triple the available grants to anywhere between $540 million and $720 million for mitigation projects, which can include relocating residents in high-risk areas, creating natural barriers, and strengthening electrical transmission systems. Applying the ratio of $6 saved for every $1 spent on mitigation, each annual investment at these levels could theoretically save upwards of $4.3 billion in future disaster costs. Despite several widely supported reforms, certain sections in the DRRA have received criticism from stakeholders that are concerned with how its changes will be implemented and affect local decisions, and if the pre-disaster fund will actually receive the maximum funding that it is now allowed.  

If it comes to fruition, a half-billion dollar increase in pre-disaster projects is a valuable start to increasing resiliency in the United States. However, even more is needed. Across all infrastructure classes, there is a $2 trillion shortfall in maintenance needs, which doesn’t include the upfront cost of upgrading assets with added resiliency. Unfortunately, this resounding need for new infrastructure investment is in sharp contrast with the current fiscal outlook for the federal government. The federal deficit for 2018 alone is projected to be $782 billion, creating pressure on Congress to decrease, rather than increase spending in the coming years. Additionally, the 2017 tax reforms are projected to further increase deficits by $1.9 trillion between 2018 and 2028. 

How Congress and the administration balance the inevitable risk of natural disasters, given impending fiscal constraints, may determine whether Hurricane Florence is a turning point for our vulnerable infrastructure or just one of the many damaging storms still to come.