According to an Associated Press (AP) story published this weekend, “A recent study for the National Institute of Building Sciences found that society as a whole saves $7 in avoided costs for every $1 spent through federally funded grants to acquire or demolish flood-prone buildings.”
Idea Behind Buyouts
Buyouts are a strategy used by FEMA to avoid multiple payouts from the National Flood Insurance Program for properties that flood over and over again. At some point, it becomes cheaper to buy the home and tear it down than to fix it repeatedly. However, buyouts can take years to process and they are always voluntary. Moreover, even if a homeowner decides not to sell, the government continues to underwrite his/her insurance.
The AP story by David A. Lieb cited the case of Mosby, Mo. Residents there flooded three times in six weeks in 2015. Many quickly signed up for buyouts, but are still waiting for offers years later.
With 7/1 savings, one wonders why it takes government so long to acquire these homes? Buyout experts that I talked to say that one of the keys to successfully negotiating a buyout is making people offers BEFORE they rebuild their homes. That observation argues for the need to streamline the buyout process, not drag it out for years.
Attempt to Streamline Buyouts
The AP story quotes U.S. Rep. Peter DeFazio of Oregon, chairman of the House Transportation and Infrastructure Committee. His committee has jurisdiction over FEMA. He questions why “….[we] keep selling them (flooded homeowners) insurance and building in the same place?”
The article continues: “DeFazio wants to expand and revamp a buyout process that he describes as inefficient and irrational. He’s backing a proposed pilot project that would give homeowners a break on their flood insurance premiums, as long as they agree in advance to a buyout that would turn their property into green space if their homes are substantially damaged by a flood.”
Status of Forest Cove Townhome Buyouts on Marina Drive
The buyout process from Harvey is just getting started in some parts of Texas. Harris County Flood Control has already bought out many homes in the Forest Cove area. “We’ve purchased three entire buildings. One has been demolished and two more are in process,” said James Wade of the Flood Control District. “We have about 65% of the units along Marina Drive purchased and are working through the remaining units.”
But over in Liberty County, officials have just started the buyout process. Buyouts require cooperation between the federal government which funds them, and city or county officials which negotiate them. Therefore, the success of buyout programs often depends on the interest level of cities and counties.
Buyout Success Often Depends on City or County
Counties that aggressively pursue buyout dollars from the federal government can offer residents an option that other counties can’t or don’t.
While most of the Marina Drive townhomes in Forest Cove are structurally unsound and therefore uninhabitable, residents elsewhere, such as Tammy Gunnels in unincorporated Montgomery County, have clamored for buyouts with no luck for years. With the May 7th rains, her home has flooded now 11 times in 10 years.
I applaud Representative DeFazio’s attempt to reform the buyout system. It seems like one of those rare instances when the humane thing to do is also the most cost-effective thing to do.
Turning Problems into Natural Retention and Recreation
A more efficient buyout process will also help rejuvenate and beautify neighborhoods. In the case of Forest Cove, the City of Houston Parks Board and Harris County Precinct Four are already working together to build a greenbelt trail. The trail would connect the County’s new Edgewater Park, under development at Hamblen and US59 with Kingwood’s trail system. That could also open up the entire Spring Creek greenbelt system to Kingwood and Forest Cove hikers and bikers. I can’t wait!
Posted by Bob Rehak on 5/28/19
638 days since Hurricane Harvey