Is it more economic to permit floodplain developments or mitigate them after floods?

3/26/25 – From a public policy perspective, is it more economical to permit floodplain developments or mitigate them after floods? I asked ChatGPT that question this morning. It was consistent with year’s of research on flooding.

The issue pertains directly to posts in the last two days about a proposed development called the Crossing at the Commons of Lake Houston. After being required by the City of Houston to raise the elevation of slabs two feet above the 500-year floodplain, the developer challenged the City all the way to the Texas Supreme Court.

Policymakers, urban planners, and economists wrestle with this question of prevention vs. correction all the time. The short answer: It’s generally more economical to restrict floodplain development than to pay for damages later. Here’s why.

Cost Comparison: Prevention vs. Mitigation

Upfront Development in Floodplains (Short-Term Gain)

• Pros: Cheaper land, attractive to developers and buyers.
• Cons: High long-term costs due to:
  • Property damage (often repetitive).
  • Infrastructure repair (roads, utilities).
  • Emergency response costs.
  • Health impacts (mold, contaminated water).
  • Insurance payouts or federal disaster relief.

FEMA reports that every $1 spent on mitigation saves an average of $6 in future disaster costs.

FEMA.gov

A scientific study published in the journal Nature Sustainability found similar results. Every dollar spent acquiring flood-prone land (a specific kind of mitigation) avoids five dollars in damages.

Examples of Mitigation Costs

• Post-flood buyouts: Government often buys and demolishes homes after repeated flooding.
• Levees/dams: Expensive to build and maintain — and they can fail.
• Flood insurance subsidies: Taxpayers often foot the bill via programs like the U.S. National Flood Insurance Program (NFIP), which is deeply in debt.

Smart Prevention Strategies (More Economic in the Long Run)

• Zoning restrictions to keep development out of high-risk zones.
• Green infrastructure like wetlands that absorb floodwaters.
• Elevated buildings or flood-resistant designs where development is unavoidable.
• Buyouts and conservation easements before development occurs.

In the past, Houston allowed extensive floodplain development. As a consequence, it faced massive losses during Hurricane Harvey. Post-flood buyouts and infrastructure repairs have cost billions. The estimated costs of Harvey adjusted for inflation now approach $160 billion.

“While development in floodplains may seem cheaper at first, the long-term economic, environmental, and social costs almost always outweigh the initial savings,” according to ChatGPT.

The developer reaps the profit, but taxpayers bear the costs.

Houston and Harris County

Looking at Houston and Harris County as opposed to national figures, evidence again suggests that proactive floodplain management is far more cost-effective than reactive mitigation.

The enormous expenses associated with post-flood recovery—illustrated by the massive losses from Hurricane Harvey—underscore the economic and social benefits of investing in prevention. Not only does prevention save money, it also helps protect community well-being, property values, and local infrastructure.

Houston and Harris County have adopted several preventive measures. Chief among them:

Floodplain Development Regulations:

Houston enforces stringent regulations for construction within flood-prone areas. The city’s Floodplain Management Office oversees permitting to ensure compliance with the floodplain ordinance and FEMA regulations. Notably, new structures are required to be elevated at least two feet above the 500-year flood elevation to mitigate potential flood damage. ​

Home Buyout Programs:

The Harris County Flood Control District administers voluntary home buyout programs aimed at relocating residents from high-risk flood zones. These programs have successfully acquired and demolished numerous properties, restoring approximately 1,300 acres to their natural floodplain functions and preventing future flood damages. ​

Such investments in flood mitigation have proven to be economically beneficial not just nationally, but in Houston, too. Studies indicate that for every $1 spent on mitigation, there is an average savings of $6 in future disaster costs. ​

$2.5 Billion 2018 Flood Bond

In 2018, Harris County voters passed a $2.5 billion flood bond. While primarily aimed at correcting past problems, it will also prevent future flooding. But so far, most of the money has been spent in Low-to-Moderate Income areas. That leaves more affluent areas, including the Commons of Lake Houston, with elevated flood risk.

All this underscores the need for accurate, up-to-date flood maps.

Posted by Bob Rehak on 3/26/25

2766 Days since Hurricane Harvey

The thoughts expressed in this post represent opinions on matters of public concern and safety. They are protected by the First Amendment of the US Constitution and the Anti-SLAPP Statute of the Great State of Texas.

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