Weathering a crisis

Various states are finding themselves reassessing how some of the costs of damages to homes and buildings are increased because building codes for these structures were not enforced. State and local governments feel that disaster relief should emphasize prevention to help limit damages.

Since 1989, when Hurricane Hugo blasted the East Coast, leveling parts of South Carolina, the United States has been battered steadily by natural disasters, enduring the Loma Prieta earthquake (1989), Hurricanes Andrew and Iniki (1992), the Midwest flood (1993) and California fires (1993).

In the wake of each disaster came new questions. Was the large-scale damage of Andrew preventable? Were construction faults rather than earthquake faults to blame for crumbled buildings in San Francisco? Why did more than 80 percent of last year’s flood victims forego federal flood insurance?

When Hurricane Andrew ripped through Florida and the Gulf Coast in August 1992, it was the most expensive natural disaster in American history, costing insurance companies $15.5 billion and the federal government another $10 billion. According to the Florida insurance department, as much as 40 percent of Andrew’s damage could have been prevented if building code standards had been enforced. Instead, widespread deficiencies were found in thousands of construction sites in Florida, where wind resistance standards are 10 mph tougher than those in any other state.

Code enforcement had been lax because state officials fell behind during the 1980s construction boom and have never caught up. Dade County, for example, approved 20,000 building permits in 1991, but it has only 60 building inspectors.

Other states face the same dilemma. Texas’ insurance department estimates that if the state’s building codes had been enforced properly prior to Andrew, 70 percent of insured losses would have been prevented. Similarly, Louisiana’s insurance commissioner says that losses could have been reduced 60 percent in his state.

Building codes work, says Jack Weber, executive director of the Natural Disaster Coalition, a Washington-based group backed by insurance companies. But they work only with a watchful eye and strong arm to back them up. He cites a 1985 study comparing Hurricanes Alicia and Diana. Alicia hit West Beach, Texas, in 1983 and damaged 70 percent of the town’s 3,000 homes because building codes were not enforced. Conversely, Diana slammed into North Carolina with comparable winds a year later, but, because codes were rigorously maintained, only 3 percent of those homes sustained major damage.

The federal government does not write or enforce building codes, leaving that task to cities and counties, where local officials understand their particular geography. Guidelines are drawn up by the American Society of Civil Engineers (ASCE), but officials are often faced with the choice of writing standards based solely on ASCE guidelines and appeasing builders who are concerned about reliability and profit. Frequently, the result is a compromise between safety and cost.

“If the technical community could write the standards, there would be a better level of protection,” says John Kuhlman, past president of the St. Louis chapter of ASCE.

Accessing Insurance

In addition to closer scrutiny of building codes enforcement, U.S. disasters of late have forced insurers to safeguard their reserves and tighten the lid on the property market. In 1988, property insurers lost less than $1.5 billion as a result of natural disasters; in 1992, they paid out nearly $23 billion. Insurers with heavy exposure in risk-prone areas either went belly up or bailed out, drastically reducing the availability of coverage. Those who stayed lowered their limits and raised premiums.

Jim Brown, Louisiana’s insurance commissioner, reports that his state suffered more than $1 billion in losses from Andrew. Many insurers stopped writing policies, and premiums for remaining coverage were raised 10 percent. Louisiana’s property owners were left in the extremely uncomfortable position of not being able to adequately protect their homes and businesses, he says.

Unfortunately, the storm may not have passed. The National Hurricane Center says that states along the Atlantic and Gulf coasts should prepare for more frequent and intense hurricanes, while the U.S. Geological Survey says that there is a 65 percent chance of a catastrophic earthquake in the next 25 years. And the costs will be astronomical, according to Applied Insurance Research, based in Boston. The firm predicts that, by the year 2020, the total bill from earthquake damage in California, Washington state and the Midwest will be $245 billion, and total hurricane expenses along the Atlantic and Gulf coasts, as well as in Hawaii, will reach $281 billion.

That is why state and local officials, as well as insurance companies, are prodding Congress to change the current federal disaster program from one that emphasizes relief under almost any circumstance to one that encourages prevention through techniques such as better building code enforcement and incentives to build away from coastlines, fault lines and flood plains.

Washington’s Response

Lawmakers have heard those pleas. Last August, Sen. Daniel Inouye (D-Hawaii) introduced the Natural Disaster Protection Act, which would, among other things, reward states for implementing hazard mitigation and emergency response systems.

Under the bill, states would be given the incentive to adopt and enforce building code standards with the cooperation of other state agencies and working professionals, and they would be required to set up comprehensive emergency response plans. The bill also seeks to withhold federal aid from communities or individuals who do not take precautions to protect themselves from potential losses. That means mandating earthquake or flood insurance for those to whom it would apply, saving the federal government billions in disaster relief.

Such relief has cost the federal government about $20 billion since 1989, and most of the funds have gone to individuals for low interest loans to pay for precisely the kinds of losses that private insurance covers, says Weber of NDC. He adds that 41 percent of the Federal Emergency Management Agency’s (FEMA) disaster relief obligations from 1977 through 1990 went to pay for things that could have been financed through the private sector.

The cost of insurance would decrease as more people purchase coverage and spread the risk. “Actuaries conclude that such a primary insurance program would reduce earthquake insurance premiums by an average of 70 percent across the country,” says Weber. He adds that premiums would be actuarially-based, meaning that those in the most risk-prone areas still would pay the most.

In addition to requiring primary coverage, the Inouye bill calls on the federal government to be the insurer of last resort. Any insurer could buy reinsurance from Uncle Sam but would only be able to tap into the coverage after it has lost either 15 percent of its surplus or $25 billion due to disaster losses. If the reinsurance could not pay claims, the government would borrow from the treasury.

“The establishment of a federal program for natural disasters of all types would allow the creation of reserves ahead of time to prepare for these catastrophes and avoid the multi-billion dollar handouts that would otherwise be sought and that we as a compassionate society would be hard-pressed to ignore,” says Linda Chu Takayama, Hawaii’s insurance commissioner.

“One of the by-products of the federal reinsurance program is that it would discourage insurers from withdrawing from disaster-prone regions, as is occurring in Florida and other high risk states,” says Joseph LaFleur, director of Pennsylvania’s Emergency Management Agency and a representative of the National Emergency Management Association, made up of state emergency directors.

While Sen. Inouye’s bill is endorsed by a broad array of interests, some consumer groups are wary. “We are concerned … it focuses on protection of the insurance industry, rather than preventing and protecting against losses from catastrophic natural disasters,” says Mary Griffin, insurance counsel for Consumers Union, Washington, D.C. “The reinsurance program provides insurers with complete protection, with no incentives to accurately price their products or to institute loss reduction measures.”

Griffin argues that natural disasters were not the sole cause of surplus reductions but were only contributors, along with inaccurate pricing, concentration of risks in certain geographical areas and mismanagement. She says that even the insurance industry admits that its availability crisis is withering, calling into question the need for federal involvement in the reinsurance business.

The Odds

Perception that the bill is a bailout for insurers could be a major hurdle for legislators to overcome. Critics note that, if the reinsurance fund runs dry, the federal government — not the insurance industry — picks up the tab. Supporters of the measure acknowledge that danger, but they believe the reinsurance program would be actuarially-based and more cost-effective than old-fashioned handouts.

Criticism surrounding the bill will likely prevent it from becoming law soon, but insurers and state insurance commissioners plan to launch a full-fledged public relations campaign to win the endorsement of the administration, particularly that of officials from FEMA and the Department of Housing and Urban Development.

“Any sort of legislation should have two goals: reduce disaster assistance and reduce the loss of life and property from natural disasters,” says Jane Bullock, earthquake project analyst for FEMA. “This bill is a step in that direction because it ties mitigation to insurance availability, but it doesn’t go far enough.”

Sen. Inouye is optimistic that, once the facts are on the table and everyone’s views can be aired, the misconceptions will fade and some type of disaster policy will be enacted. He hopes the bill will clear the Senate and House by this Autumn and be ready for the president to sign before the 103rd Congress adjourns.

“Whether this bill becomes law or the status quo remains, the federal government will remain involved,” says Inouye. “Either the involvement is through this reinsurance program or through disaster relief. The insurance industry simply can’t afford to go it alone.”

Grinders Hasten Tree Cleanup

One of the enduring images of 1993 is that of the midwestern United States submerged beneath gallons of river and rain water as weather and outdated levees combined to bring record floods to the region.

Damage from rainfall was only part of the problem, however. Last July, for example, hurricane-force winds wailed through much of eastern Nebraska, ushering in baseball-size hail stones in addition to the heavy rain.

In the Lincoln area alone, damages ranged from downed power lines and shattered signs to battered homes and trees. More than 5,000 trees were destroyed or damaged in the storm, and officials were eager to begin removal and cleanup.

“Besides the appearance of dead limbs and trees lying around, there was increased danger of weakened limbs falling later,” says Lincoln Parks Director Jim Morgan. “We decided we had to get rid of them as quickly as possible.”

The Parks Department calculated it would take the city’s 19-member forestry crew two years to finish the cleanup. And at $440 per tree ($300 for removal, $50 to remove the stump and $90 to purchase and plant a new tree), costs would approach $2.5 million.

To save time and money, city officials contracted with Fox Bros. Hay Co., O’Neill, Neb., to grind the fallen trees into mulch and wood chips.

The tub grinders used in the project were hay grinders modified to handle trees and logs. Three grinders were placed in key parks around the city, and trees and limbs were hauled to the closest site.

The mulch was offered free to Lincoln residents, who carried it away as fast as it was ground, Morgan says. Trees larger than 20 inches in diameter were sawed up and given away as firewood.

Cleanup was completed in five weeks for considerably less than $2.5 million. “If we had to haul away the trees, limbs and brush without grinding, it would probably have cost 20 times as much,” says Morgan.

And this way, he adds, “the material is being put to good use for yards and gardens.”

Des Moines |Rents’ Power to Restore Water

With damages exceeding $12 billion dollars, last sum-summer’s flood in the Midwest ranks as one of the nation’s costliest natural disasters, second only to Hurricane Andrew, which ripped across south Florida in 1992.

Among the cities hit hardest by the flood was Des Moines, Iowa, where, in July, rivers swelled to overtake utility substations and the Des Moines Water Works, rendering hospitals, communications systems, utilities, government agencies and private businesses powerless and without water.

A long-term crisis was averted when power was restored to the Water Works plant through rented generators, allowing the plant to recharge the city water system. Water Works staff set up an operations base the day of the flood, and power was fully restored to the plant in just over a week.

One of the first steps in the reclamation process was to rent generator sets to power water pumps and rid the Water Works plant of standing water. The only other choice was to wait for the flood waters to recede so that utility power could be restored.

While the National Guard fortified a 12-foot levee built by Water Works staff, six generator sets supplied by Ziegler Power Systems, Des Moines, and Caterpillar Rental Power, Mossville, Ill., were airlifted to the plant by helicopter.

The generators were placed on top of the levee surrounding the plant, and flood water was then pumped outside the levee. Within two days, the water level had dropped enough for engineers to examine equipment inside the plant and determine the extent of damage.

By the third day, 13 additional generator sets had arrived and were up and running, providing 800 kW to power water pumps and air driers. The plant’s portable emergency backup generator, damaged by water, was repaired and put into use.

Utility power was available to the plant by this time, but it was fed by a makeshift transmission line, and there was no backup system. Water Works engineers were ready to restore the motors that drive the city’s water pumps, but they were concerned about losing utility power in the process.

From Caterpillar, they ordered two utility-grade power modules, which were transported to the plant on a makeshift road. Within hours of their arrival, the modules were paralleled and tested. Together, they provided 3,200 kW of power, which was not only sufficient to back up the utility but was also enough to feed the water system indefinitely.

With a backup power system in place, engineers began testing the water pumps that supply water to the city. None of the pumps was operational, despite efforts to repair them, but work continued on the largest one — a 1,750-hp pump that engineers feared would be too powerful for the water system, causing pressure surges during the recharging process.

By the eighth day, workers had taken steps to alleviate startup pressure, and, using electricity from the power modules, they activated the large pump and restored water to the city system. Four days later, running water was available to residents, and potable water was restored within two weeks.

GIS Guides Efforts to Contain Oil Spill

Last August, an outbound freighter loaded with phosphate material collided with two inbound barges — one carrying #6 fuel oil and the other loaded with aviation fuel — near the mouth of Tampa Bay, Fla. One barge burst into flames, and both leaked contaminants into the bay. Within hours, 300,000 gallons of fuel oil were riding the tide toward some of Florida’s most sensitive ecosystems.

To anticipate the fuel’s path, the U.S. Coast Guard and other responding agencies relied on mapping technology provided by St. Petersburg, Florida’s Marine Research Institute (MRI). Within six hours of the collision, MRI had produced the first maps showing locations of the vessels and the perimeter of the leaking contaminants.

The maps provided a “big picture,” identifying wildlife habitats and showing where booms needed to be placed, says Ensign Steven Lang of the Seventh Coast Guard District’s Marine Safety Division in Miami. Using this data, the Coast Guard directed oil skimming vessels and placed booms to steer contaminants away from the most sensitive areas. As the oil slick progressed, responding agencies predicted that weather conditions would drive the fuel toward John’s Pass, with its expensive boats, popular beaches and fragile ecosystems. As the slick neared the beaches, more precise maps — including information on road networks, navigational aids and the locations of temporary wildlife rescue headquarters — were used to coordinate the 600 volunteers ready to assist in the cleanup.

As final damages are assessed in Tampa Bay, MRI’s system, developed with Arc/Info software from Environmental Systems Research Institute Inc., Redlands, Calif., is being used to create detailed maps of the ecosystems that were affected by the oil spill and to assist in examining damages to surrounding natural resources.

Technology |Maps’ Path for Flood Recovery

As the Mississippi River swelled and washed over much of the Midwest last summer, it beat a path of destruction from as far north as St. Paul, Minn., to the southernmost extremes of Illinois. The constant rain kept the river raging at levels 25 to 35 feet above normal for several weeks. Homes, businesses, roads and airports were submerged and, in some cases, cut off from supplies.

Valmeyer, Ill., a small railroad and farming community about an hour south of St. Louis, was hit twice by the flood, once when the levees broke upstream on August 2 and again on September 10.

As the initial floodwaters began to recede in late August, Valmeyer’s 900 residents began weighing their options: rebuild, raise their structures or abandon them altogether. Some residents had already packed up and moved elsewhere, realizing they could neither afford to rebuild or repair their homes nor endure the wait to do either.

Working with the U.S. Army Corps of Engineers and Geo Research Inc., Billings, Mon., the Federal Emergency Management Agency (FEMA) was able to use mapping technology to determine damages and assist local officials in planning reconstruction.

In late July, FEMA commissioned a pilot study to assess and inventory the flood damage using Global Positioning System (GPS) and Geographic Information System (GIS) technology. A team consisting of a handful of observers from FEMA, the Corps of Engineers in Rock Island, Ill., and Geo Research began recording structure damage throughout Illinois. In less than two months, the team drove the length of the state and assessed thousands of structures, registering about 1,600 of them, including more than 250 in Valmeyer alone.

Data were recorded using Motorola’s LGT 1000 GPS/GIS mapping system and Geo Research’s GeoLink software and sent via disk to Rock Island, where the Corps of Engineers plotted community and structure maps. Within days of the data transmission, FEMA and local officials began meeting with flood victims to start the rebuilding process.

In addition to time, the GPS technology saved money, says Eric Berman, FEMA GIS coordinator for the Illinois disaster. “Thanks to GPS, people who needed help or information about rebuilding got it with little or no delay,” he says, adding that manual assessment would have required a workforce of 50 and cost hundreds of thousands of dollars more than mapping.

“Previously, it would take many people and significant amounts of time to collect the data and build a single-scale map of a given area,” explains Harry Bottorff, computer systems coordinator for the Rock Island Corps of Engineers and project manager for the Mississippi mapping program. “By using GPS and GIS, we created hundreds of maps on a variety of scales within a few days. Until now, this amount of work would take years to complete.”

“GPS can be used to not only produce maps, but to show locations of hazards, roads, waterways and where to set up disaster centers,” says Berman. “And, once an area has been mapped, we can reuse that database to help in planning for future disasters.”

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