POLICY

Ideas to reduce future storm damage include carbon tax, cutting disaster aid

Superstorm Sandy is still surging, but this time the October disaster is driving a debate about how to reduce rebuilding aid -- by investing in preventive measures before stronger storms strike.

As Congress considers a $60.4 billion request from the White House to replace roads, repair islands and construct coastal fortifications, advocates with different political loyalties agree that the federal government must somehow persuade local officials to build stronger, and smarter, communities.

But that goal has been largely unmet for years, resulting in new development and climbing disaster damage in dangerous places. It comes as scientists say that higher temperatures threaten to amplify storm effects through rising seas and a tweaked hydrological cycle.

Now, advocates are pushing different ideas to reduce federal policies that encourage coastal development through cheap flood insurance, grants for economic development and, some say, the disaster package that President Obama proposed for climate adaptation.

"We have to recognize that we must stop making things worse," Ed Thomas, president of the Natural Hazard Mitigation Association, said yesterday on a conference call. "We are going to choose as a society between better standards that protect people and resources, or what we're doing today, which will inevitably result in destruction and litigation."

He and others say the nation needs a buffet of improvements that limit construction in floodplains and strengthen communities located in peril-prone zones. That includes stronger building codes, thoughtful land-use policies and hardened infrastructure standards. It also means, to some, dismantling subsidies in public insurance programs and reducing disaster funding, which some say only masks the danger of natural catastrophes.

The divergent ideas being proposed to achieve those goals include charging fossil fuel companies to pay for stronger building improvements, withholding disaster aid until communities adopt heartier standards and slashing post-disaster funding.

Obama's adaptation provision might cause more damage

Obama's proposal for New York and New Jersey includes $13 billion for mitigation projects, including $3.8 billion for dunes and other protective barriers to be built by the Army Corps of Engineers. Supporters call that climate adaptation. But others contend that some of those projects could continue the government's role in promoting what amounts to a moral hazard along the nation's shorelines -- by giving people the false impression that they're safe.

"The mitigation piece of it is problematic," said Eli Lehrer, president of the R Street Institute, a conservative organization that works with environmentalists and insurers to reduce subsidies in public insurance programs. "I think the bill should be drastically scaled back overall."

He suggests that the disaster supplemental package could be cut in half. That would save taxpayer money, he says, now and in the future -- by reducing incentives to develop coastlines. Lehrer also proposes cutting the federal share of post-disaster rebuilding costs to 50 percent. Currently, the government pays for 75 percent of recovery efforts, and Obama is asking Congress to increase that to 90 percent for Sandy survivors.

Under Lehrer's plan, communities could receive more federal funding if they commit to stronger building standards that require things like elevated homes and buying out the riskiest properties.

Sandy made landfall during a rising trend of disaster declarations. Between 2004 and 2011, the White House approved 539 requests from governors for federal assistance, or 86 percent, according to a Government Accountability Office report released in September. Those disasters are expected to cost federal taxpayers about $91.5 billion.

Withhold aid to spur mitigation

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One reason for the rise is that the Federal Emergency Management Agency, which administers the Disaster Relief Fund, uses an "artificially low" indicator to determine whether a state needs public assistance funding, the report says. FEMA assumes that a state needs funding if a disaster's damage exceeds $1.35 for every resident. So a state with 10 million people would be eligible for federal assistance if a storm causes $13.5 million in damage to public structures.

But the agency has not kept up with inflation or rising per-capita income. If it had, FEMA would be using an indicator of $3.57 per person, the GAO report says.

Some advocates believe that the cost to taxpayers could become a justification to fortify homes and infrastructure. One study shows that every $1 invested in mitigation saves taxpayers $4 in post-storm payments.

Cynthia McHale, director of the insurance program at Ceres, a group of institutional investors concerned about climate change, suggested last week that disaster aid should be withheld until communities pledge to reduce future risks.

"The federal government and Congress should link federal recovery assistance to climate resiliency planning," she said. "As part of any congressional disaster aid bill there should be crystal-clear language: No checks will be mailed without local assurances that resiliency measures are being pursued."

Should energy companies fund resiliency?

Others suggest charging a fee on activities that produce greenhouse gas emissions to fund mitigation. The Center for American Progress, a liberal think tank, released a report yesterday saying that a $1-per-ton fee on energy companies would have raised $5.4 billion for climate adaptation efforts in 2012. A 10-cent fee for every mile traveled in a car would have generated $8.4 billion.

"To ensure that communities have these resources, there must be a dedicated source of revenue to fund pre-disaster mitigation programs that is not susceptible to budget cuts or political manipulation," the center said in a press release. "Since the frequency and/or severity of extreme weather events will be exacerbated by climate change, it makes sense to raise revenue for resiliency from the fossil fuels whose combustion emits carbon pollution responsible for climate change."

The report urges the president to form a blue-ribbon panel to identify potential funding streams for mitigation, noting that it would cost less than post-disaster recovery efforts.

The Sandy supplemental funding bill is pending in the Senate, where the Banking, Housing and Urban Affairs Committee will hold a hearing Thursday on transportation infrastructure to generate support for its passage. In the House, which is moving more slowly, lawmakers are considering spending offsets in the amount of disaster assistance.

Rep. Earl Blumenauer (D-Ore.) is working with a diverse coalition of mitigation supporters to promote policies that would harden homes and infrastructure against disasters. An aide said on background that it's unclear whether there's an opportunity for Blumenauer to push for increased funding.

"After a disaster, that's easier to do," the aide said. "I think it's a good time to be raising this issue."

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