The Natural Hazard Mitigation Association (NHMA) Comments on “Establishing a Deductible for FEMA’s Public Assistance Program”

At the Natural Hazard Mitigation Association (NHMA), we are tremendously supportive of the proposed Public Assistance Program (PA) Deductible because it has the potential to reinforce and support one of our core tenets: that we as a Nation must, state-by-state and community-by-community, establish higher development standards to be more resilient and to reduce future risk. While these types of efforts are sometimes associated with upfront higher costs, a careful and reasonably constructed program will actually have the potential to save vastly more costs in the long run and lead to a more resilient and prosperous community. We also strongly support the investment and commitment of individual states, tribes and local governments to enact and implement natural hazard mitigation measures.

The savings of disaster damage risk reduction (used interchangeably with hazard mitigation) are well-documented including the 4 to 1 dollar return on investment stated in the 2005 Multihazard Mitigation Council’s (MMC) of the National Institute of Building Sciences “Natural Hazard Mitigation Saves: An Independent Study to Assess the Future Savings from Mitigation Activities“. Other studies from the Wharton School at the University of Pennsylvania and the large insurance company Swiss Re indicate that higher design standards have a far greater payback than 4 to 1. More specifically, Swiss Re reports that “Evidence suggests that every dollar spent on disaster risk reduction has a ten-to-one cost benefit ratio, and our own studies show that we can avert up to 65% of climate risks using cost effective measures.”
In any case, those higher standards place the cost of the development on those who develop and use the development, rather than permitting those costs to be improperly externalized to society as a whole. This basic philosophy has been affirmed all the way up to the Supreme Court with Justice Samuel Alito observing in the Koontz v. St Johns River Water Management District case: “Insisting that landowners internalize the negative externalities of their conduct is a hallmark of responsible land-use policy, and we have long sustained such regulations against constitutional attack.” (for more information on legal perspective regarding externalities, see:

We believe that safe design and zoning standards, which protect the property and rights of all in the community, have an even greater payback to the community than good building codes, which are normally based on life safety. Good building codes typically only consider disaster damage risk reduction, building functionality, and operability, essential components to avoiding major costs and disruption, only when “where practicable to do so.” For example, the National Earthquake Hazards Reduction Program Provision’s objective states that ordinary buildings in earthquakes will: “Avoid serious injury and life loss due to structural collapse, failure of nonstructural components or systems, and release of hazardous materials… and reduce structural and nonstructural repair costs where practicable to do so.” [from in-progress draft as of summer 2014]

At the 2016 Building Innovation Conference and Expo, sponsored by the National Institute of Building Sciences, Dr. Keith Porter suggested that if the goal of building codes were to be resilience, costs would increase about 1%; the savings in areas prone to earthquakes would be many multiples of the extra costs. In following the earthquake example in the above paragraph, earthquake codes could be modified as Dr. Porter suggests from current standards to a more holistic one: “Ordinary buildings in earthquakes will: ‘Avoid serious injury and life loss due to structural collapse, substantial damage to nonstructural components and systems, and release of hazardous materials, and be largely habitable or functional.”’ [Emphasis added] The codes should be modified for other foreseeable natural hazards as well to incorporate resilient standards into our development practices and avoid the costly scenario of losses and future retrofits.

NHMA observes that the effort to establish a deductible on the merits of state/local action has many parallels to the origins the United States systems of dealing with the reduction of urban fire risk. As indicated in the FEMA Publication America at Risk America Burning Recommissioned (FA-223/June 2002) when discussing fire loss in urban portions of the United States:
“Today, the threat of fires is still with us. But we have done a lot to address the risk, minimize the incidence and severity of losses, and prevent fires from spreading. Our states and localities have an improving system of codes and standards; most of us are aware of the risks; we have accomplished a lot, but we have much more to do.”
“As the… report (FA-223/June 2002) very clearly indicates, the success of America’s fire services over the past 100 years is instructive for the strength and sustainability of America’s communities for the next 100 years as well. Today, we must not only continue and reinvigorate our successes, but also expand them to include the natural and man-made threats that each of our counties, cities, towns and villages face every day – floods, earthquakes, hurricanes, hazardous material spills, highway accidents, acts of terrorism, and so much more.” [Emphasis added] In addition, the FEMA National Flood Insurance Program (NFIP) Community Rating System (CRS), has also successfully provided incentives for communities to exceed floodplain standards. The lessons drawn from the establishment and enhancement of CRS is to first identify the most important and meaningful activities that earn incentives. By definition, these would be activities that represent best practices and can demonstrate measurable improvement.
Lastly, NHMA encourages FEMA to use its existing authority under Section 323 of the Stafford Act (PL 93-288), which can require safe land use and construction practices, to help achieve the implementation of the PA Deductible.

Therefore, we believe the following two overall principles are most important for the PA Deductible which are proven meaningful techniques that are working:
• Heavily incentivizing better development standards – We make a strong recommendation that disaster damage risk reduction take a prominent place in both zoning codes and building codes so that life safety concerns, post event operability as well as disaster damage risk reduction, including to help in that transformation. Building and zoning/land use codes that better address real resilience to natural hazard risk. These codes should address disaster damage risk reduction including operability and functionality post-event. Examples of how this could be applied are enhanced building codes and resiliency into planning like the incorporation of hazard mitigation into State and local comprehensive planning requirements (e.g., the Safety element in the California state planning requirements and the California Earthquake Authority education and retrofitting mitigation activities)
• Investment and commitment of state/local/tribal resources – Provision of state/local/tribal funds to develop or match projects that reduce risk. Use of local planning to minimize, or design to higher standards future and post disaster development in hazard prone areas. Capital improvement to protect existing facilities and infrastructure. See, e.g., Hazard Mitigation in Disaster Recovery, by Edward A. Thomas, Esq., and Lincoln Walther, FAIA, in Planning for Post Disaster Briefing Papers, American Planning Association, 2015. Located at:

Below are detailed activities that should be considered for demonstrating investment and commitment of state/local/tribal resources:
State Government
• Enhanced State Hazard Mitigation Plan (SHMP) that is not only approved by FEMA, but documentation shows that it is routinely updated/implemented through a plan maintenance process that involves all state agencies, as appropriate (i.e., not limited to a one-agency plan).
• State funding for hazard mitigation projects as identified in the SHMP
• The percentage of population covered by a state-led Cooperating Technical Partners (CTP) programs which shows commitment of state resources to flood mapping and flood risk reduction
• Adoption of state building codes that are consistent with or exceed the latest (or recent) versions of I-Codes
• State enabling legislation for planning requires hazard-specific elements to be incorporated into local comprehensive/general plans
• State-specific guidance for integrating climate adaptation or disaster damage risk reduction into local planning (such as CA and CO)
• Uniform Minimum Credit (UMC) points as issued for the state under CRS
• Establishment of state-specific PA program (such as NC)
• Establishment of Disaster Reserve Fund (or similar “rainy day” fund, that includes but is not limited to match funds for FEMA grant programs)
• Adoption and compliance with statewide hazard disclosure laws for realtors, lenders, etc.
• Accredited state agency under the Emergency Management Accreditation Program (EMAP) that includes credit for mitigation and long-term recovery

Local/Tribal Government
• Local funding and/or other resources used for hazard mitigation projects/actions as identified in the local hazard mitigation plan
• Documentation that local policy and planning processes (comprehensive plan, Capital Improvement Program, zoning ordinances, development regulations, etc.) have incorporated disaster damage risk reduction principles and practices
• The percentage of population covered by a regional or local-led Cooperating Technical Partners (CTP) programs which shows commitment of regional or local resources to flood mapping and flood risk reduction
• Documentation of other risk-based but non-regulatory approaches to planning for disaster resilience (e.g., local incentives, education/outreach campaigns, guidance, etc.).
• Designation of a full-time Chief Resilience Officer (or equivalent) who reports directly to the chief executive officer or elected official(s), with general oversight and responsibility for implementing disaster damage risk reduction activities across local departments/agencies
• Documentation that a portion of the local government’s financial resources are dedicated to disaster damage risk reduction outcomes (e.g., similar to the “10% Resilience Pledge” under the Rockefeller Foundation’s 100 Resilient Cities Challenge).
• Documentation of losses avoided (following the event that triggers a PA declaration)
• Positive CRS and Building Code Effectiveness Grading Schedule ratings (easily obtained from the Insurance Services Office; FEMA has already identified as metric for local commitment to risk reduction)
• Documentation that shows how the local government has decreased its aggregate risk to hazards through future conditions-based mitigation planning and project implementation (e.g., what Charlotte-Mecklenburg County, NC has done for flood risk)
• Adoption of a Post-Disaster Redevelopment Plan / Recovery Plan that includes specific governance measures, land use policies and regulatory actions relating to “disinvestment” in hazard areas that are severely damaged or destroyed by disaster (e.g., Hillsborough County, FL)
• Accredited local agencies under the Emergency Management Accreditation Program (EMAP) that includes credit for mitigation and long-term recovery