Managed Retreat in the Face of Climate Change: Examining Factors Influencing Buyouts of Floodplain Properties
Qing Miao, Meri Davlasheridze
Abstract
Managed retreat from hazardous areas is a long-term strategy for mitigating natural disaster risks and adapting to climate change. In the United States, managed retreat is often sponsored by governments through acquiring properties in the aftermath of a major disaster event. This study empirically examined the institutional factors that influence government buyouts of floodplain properties across US counties, with a particular focus on local fiscal conditions and existing flood management practices. The empirical analysis drew on a nationwide panel data set of buyout projects funded through the federal Hazard Mitigation Grant Program over the period 1990–2016. Using a double-hurdle model, the authors found that counties with more property tax revenues and a lower fiscal reliance on property taxes have more postflood buyouts. Results also indicate a negative impact of flood insurance take-up rates and levee protection on a county’s buyouts of flood-prone properties. These findings shed new light on the challenges for government buyouts and possible conflicts among different policy instruments in flood risk management.