1. Home Buyouts for Repeatedly Flooded Homeowners Must Happen Faster

    May 21, 2019

    By Julie Skarha.

    In July 2018, Olga McKissic of Louisville, Kentucky, received an offer to buyout her home of 32 years. She had endured five floods between 1997 and 2018—each of which inundated her home with 18–20 inches of water. In 2013, Olga began the arduous process of trying to secure a home buyout, enabling her to move somewhere that was safe from flooding. It took Olga four years to get to the point where the Federal Emergency Management Agency (FEMA) approved funding and an offer being made for her house, during which time her property flooded again. But Olga still is awaiting the final purchase of her home.

    Unfortunately, there are thousands of homeowners in Olga’s situation. Across the U.S., more than 30,000 [1] “severe repetitive loss properties” have flooded an average of five times. These properties have been rebuilt by the National Flood Insurance Program (NFIP). Negligent floodplain development and a lack of real estate disclosure laws regarding a home’s flooding history are part of the problem. Home buyouts are a potential solution.

    How does a buyout work? Using funds provided by the Federal Emergency Management Agency (FEMA), local and state agencies can purchase the homes of willing homeowners who have been damaged by or are highly vulnerable to natural disasters. When a property is bought out, homeowners are paid the pre-flood value of the home and can then relocate out of harm’s way. After the house is demolished, the land left behind is required to be maintained as open space and managed by the local government in perpetuity. The land can be used for floodwater diversion, granting a measure of additional protection to other homes in the area. Some communities have gone further, transforming old properties into gardens or parks.

    Previous research [2] by FEMA shows that although low-income households are more likely to live in high-risk flood areas, they are much less likely to purchase flood insurance. Low-income homeowners are particularly disadvantaged when it comes to repeat flooding, as they lack the financial resources to repair damages, find temporary housing, and pay for flood insurance plans. What happens to low-income homeowners who want a buyout but cannot rely on the NFIP or their savings during the lengthy buyout process?

    In 2017, Hurricane Harvey struck Harris County, Texas. More than 120,000 residential properties were damaged. Although Harris County had prior experiences with flooding, plus a 30-year-old program [3] with dedicated staff working on federal buyout assistance, the post-Harvey buyouts took nine months to begin. By that time, real estate speculators and developers had already swarmed the area, canvassing and advertising quick cash buyouts, which were sometimes as little as a third of what the homeowners originally paid [4]. Some of the people who were hoping for a buyout from Harris County couldn’t endure the long wait and eventually sold their flooded homes to the real estate speculators. Instead of those properties becoming open space, the homes are likely going to be repaired and passed along to unsuspecting buyers and renters.

    In the past 20 years, sea levels have risen three inches. Soon, millions [5] will be affected by repeat flooding, with low-income homeowners impacted the most. A federally-funded buyouts system is a win for the homeowner, who can safely move elsewhere, and a win for the government, who is able to save the tax dollars that it would pay to repeatedly rebuild these homes. But the process must happen faster. If it doesn’t, the only ones who will win are the developers who continue to make off with millions in the face of natural disasters.

    [1] Seeking Higher Ground: Climate Smart Solutions to Flooding, https://www.nrdc.org/experts/rob-moore/seeking-higher-ground-climate-smart-solutions-flooding, Published: July, 2017

    [2] Affordability Framework on the National Flood Insurance Program, https://www.fema.gov/media-library/assets/documents/163171, Published: April, 2018

    [3] Harris County Flood Control District, https://www.hcfcd.org/hurricane-harvey/home-buyout-program/latest-updates-about-home-buyouts/ , Accessed: August 13, 2018

    [4] Houston-area leaders seek ways to stem investor buyouts of flooded homes, https://www.houstonchronicle.com/news/houston-texas/houston/article/Harris-County-leaders-want-more-aggressive-buyout-12923703.php, Accessed: August 13, 2018

    [5] Matthew Hauer, Jason Evans, and Deepak Mishra; “Millions Projected to Be at Risk from Sea-Level Rise in the Continental United States,” Nature Climate Change 6 (April 2016): 691-695, https://www.nature.com/nclimate/journal/v6/n7/full/nclimate2961.html.

    Julie Skarha is a 2018 Environmental Fellows Program fellow. She was placed at the Natural Resources Defense Council office in Chicago, IL for the summer. There, she researched the impact of the federal buyout policy in the context of climate change. She is currently a graduate student in the Department of Epidemiology at Brown University. Her research interests include are how our daily environmental exposures, including environmental pollutants, social and built structures, and government policies, relate to health outcomes.