The Cost of Coastal Storm Surge Damage Reduction

Coastal building codes are designed to protect property against storm surge flooding. However, some property owners make improvements beyond code to provide added protection. These improvements include house elevation on fill or pilings, levee and floodwall construction and house relocation. Given recent hurricane strikes in Wilmington, NC - Bertha, Fran, Bonnie, Dennis and Floyd - we investigate the costs of storm surge mitigation for individual property owners in that region. We find: (1) least-cost improvements vary with storm surge depth, foundation type, and new versus retrofit construction; (2) the incremental benefits of structural improvements, in terms of damage reduction, are increasing in improvement expenditures; and (3) the least-cost response to a given storm surge level is to either purchase no structural defenses (beyond building code requirements) or to purchase enough structural defenses to prevent all damage--"all-or-nothing" purchase behavior. Furthermore, we show that hurricane strikes at particular locations are such low probability events that the expected benefits from defensive expenditures (beyond building codes) may not justify even least-cost improvements.

The Cost of Coastal Storm Surge Damage Reduction Academic Article