A Place Worth Protecting: Rethinking Cost-Benefit Analysis Under FEMA’s Flood-Mitigation Programs
As climate change threatens coastal areas with more frequent and intense flooding, the federal government has adopted a greater focus on mitigating the effects of natural disasters. While neighborhoods differ in terms of physical risk exposure, they also differ in social vulnerability—the characteristics that influence a community’s ability to safely weather a storm, withstand disruptions to employment and housing, navigate the rebuilding process, and eventually return to normal. Funding for federal flood-mitigation projects administered by the Federal Emergency Management Agency (FEMA) is currently distributed according to a simple metric—the benefits of a project must outweigh its costs. FEMA’s approach to cost-benefit analysis (CBA), however, primarily measures physical risk to property while neglecting the long-term, intangible social costs incurred by vulnerable communities. This approach has resulted in higher-property-value communities receiving a disproportionate share of mitigation infrastructure, while lower-income communities are either left without protection or relocated. The distribution of mitigation funding therefore plays a role in exacerbating place-based inequality.
This Comment proposes ways in which FEMA could better account for the distributional effects of its projects and promote efficient policies that take into account the full range of social and economic costs associated with natural disasters. It begins by detailing how FEMA neglects to consider distributional outcomes in its mitigation programs, consistent with the single-minded focus on economic efficiency prevalent in federal regulatory decision-making. Next, it surveys empirical research documenting the ways in which FEMA’s use of CBA exacerbates wealth inequality and social vulnerability to flooding. The Comment then considers various legal avenues for redressing the disparate impacts resulting from FEMA’s policies, concluding that none are likely to be successful. Instead, it offers five policy adjustments that FEMA could implement in its cost-benefit methodology to ensure that resources for flood mitigation are more equitably distributed, emphasizing ways in which these better accord with the agency’s own focus on economic efficiency.
"A Place Worth Protecting: Rethinking Cost-Benefit Analysis Under FEMA’s Flood-Mitigation Programs,"
University of Chicago Law Review: Vol. 88:
8, Article 4.
Available at: https://chicagounbound.uchicago.edu/uclrev/vol88/iss8/4