With 7 million Californians and $600 billion in assets at risk, Assembly oversight hearing examines the state’s liability for flood damages and the annual $1 billion investment gap in flood management infrastructure spending
Precipitation in California can vary greatly from year to year, from devastating droughts to calamitous floods, sometimes even both in the same year. Floods and droughts are regular features of our state’s highly variable climate, and just as no one part of the state can be immune from drought, there are few very few parts of the state that are immune to flood risk – since 1950, flood disasters have been declared in every county at least ten times.
Flooding can occur in a number of ways: heavy precipitation events and snowmelt can cause rivers to rise and flood their banks in the northern part of the state; heavy downpours cause flash flood events and alluvial fan flooding in the southern desert areas; coastal areas are at risk from high tides, storm surges, tsunamis, and other ocean events; and heavy rains can cause debris flows in areas that are recovering from fires.
Flooding can cause loss of life and billions of dollars in damage. The Department of Water Resources estimates that one in five Californians lives in a floodplain, putting more than 7 million residents and $580 billion in assets at risk. The impacts of flooding include damage to critical transportation, utility, and water infrastructure, and isolation or even closure of vital services such as hospitals and other emergency services. It’s important to realize that flooding can never be entirely prevented; the risk and consequences can only be reduced.
Recognizing the flood risks facing the state despite the current exceptional drought conditions, in January of this year, Chair Marc Levine of the Assembly Committee on Water, Parks, and Wildlife held on informational and oversight hearing on California’s Flood Control Planning and Infrastructure.
“This past year, we have often heard the famous saying, never waste a good crisis, but we shouldn’t wait for crises to act,” began Chair Marc Levine. “That is why I am convening this hearing on flood control now. California has a long history of alternating between periods of drought and periods of flood. According to the California Department of Water Resources, over the last 60 years California has experienced more than 30 flood events, major flood events, resulting in more than 300 lives lost, more than 750 injuries, and billions of dollars in disaster claims.”
One in five Californians – over 7 million -live in the 500 year flood plain; nearly $600 billion in assets, crops, structures, and public infrastructure are exposed to flooding, he pointed out. “With future development, population changes, climate change, the loss of major infrastructure, critical facilities, and state commerce, that figure could climb much higher,” he said. “So before the next flood event, whether it’s this year or five years from now, we should understand our flood control system, who is responsible for it, and where we need to make the most strategic improvements and investments.”
Chair Levine noted that the Governor’s budget was recently released and it proposes expediting the remaining $1.1 billion of Proposition 1E funds to DWR for projects that are consistent with the Central Valley Flood Protection Plan.
To provide a bit of an overview prior to the start of testimony, the following video was shown:
ELLEN HANAK: Senior Fellow, Public Policy Institute of California
Ellen Hanak kicked off the testimony portion of the hearing with a brief overview of some of the statistics, as well as some recent work that the Public Policy Institute of California recently completed on finance issues for flood infrastructure and management. “It’s true that we are making a lot of investments right now to improve the reliability of our levees and so on, but in a sense we are also facing growing risks despite the fact that we’re making improvements,” she said.
Ms. Hanak presented two maps from the Flood Futures report and said that although the Central Valley is a big place for both population exposed and for risk, there are flood risks statewide.
Noting that on the map, darker means more, she pointed out that the most population and the most assets exposed are in coastal Southern California. “In addition to the tremendous risks and vulnerability in the Central Valley, we also have a lot of vulnerability in coastal areas, and that includes the Bay Area, and especially around the low lying areas around the San Francisco Bay and along the coast.”
Although we’re improving our flood infrastructure in some places, the risk is growing because of other factors, she said:
Population growth: “We know that we can’t completely eliminate the risk especially behind levees, but when more people and businesses locate in those places, it just increases the potential damage when we do have a flood.”
Sea level rise: “California has been facing rising sea level in our coastal areas ever since the end of the last ice age, and this is something that may accelerate as the climate warms, but what that does is it increases the likelihood of storm surges and it basically makes it more likely to have bigger flooding in coastal areas. This is a concern along the ocean coastline in the Bay Area and in the Delta.”
Extreme weather: “According to climate models, It’s also likely that we’re going to be having more extreme weather. More extreme droughts, more extreme floods, and warming temperatures also mean that we get less snow and more rain and that can increase the effect of individual big storms in the winter and make it more likely to flood.”
California’s flood management system is complex and is managed by state, federal, and local agencies. The elements of the system include reservoirs, levees, channelized rivers, urban stormwater systems, floodplain bypasses, and seawalls.
Some types of flood protection can yield other benefits, and the Yolo Bypass is one example of that, she said. “The Yolo Bypass has been around since the early 20th century and it’s critical to the protection of the Sacramento Metro Area from flooding,” she said. “It turns out that, from an ecosystem perspective, it provides a lot of benefits. We’re discovering that in addition to helping with birds, it’s also actually a great place to raise baby salmon. Some bypasses can also be useful for helping to recharge groundwater basins.”
Setback levees can also provide multiple benefits, she said. “Instead of building levees very close to the edge of the river, building them back a bit so it gives a bit more room for the river,” she said. “This can increase the flood protection for the folks behind those levees, but it also can enhance the other benefits.”
California flood management faces significant challenges. “There is a big investment gap,” Ms. Hanak said. “Also in the Central Valley, the state is liable, potentially, for billions of dollars in damages, stemming from the Paterno ruling in 2003 which held the state liable for the failure of a locally managed levee within the Central Valley. That relates to the complex nature of the state – federal role in Central Valley flood protection in particular, which I think was probably one of the factors that really got folks mobilized after Hurricane Katrina to get some flood money into a bond on a ballot and ask voters to approve it.”
Flood control investments help but don’t eliminate the risk, and can sometimes even increase risk, given the low federal standards, she said. “That’s especially an issue in places where we are building according to federal standards, where basically federal flood insurance standards require communities to restrict construction in places with less than protection from a 100 year flood,” she said. “There are only about 4% that lives in those areas that are very flood prone, but then if you have protection from that 100 year flood, which is a flood that’s large enough that it has a 1% chance of occurring every year – if you have better protection than that thanks to a levee for example, then there are no restrictions, at least under the federal law.”
“The fact that we can’t eliminate flood risk means that we need to complement investments with other tools like insurance,” she said. “There is federal flood insurance available; it can be quite expensive in the 100 year flood plain but in the areas that are protected for at least that amount of protection, it’s actually not that expensive. However, folks don’t tend to use it that much.” Ms. Hanak said recent data from DWR suggests that uptake is down, probably because of the drought and recession, so even in the 100-year floodplain, it’s only estimated 22% of the people have flood insurance.
She then presented a bar graph breaking down spending on water systems by federal, state, and local entities, as well as the sectors where the money is being spent.
“Flood management is not the big ticket item in the overall scheme of things,” she noted. “The big ticket items are especially urban water supply and urban wastewater systems, which are vast underground systems, miles and miles and miles of plumbing and treatment facilities and so on. A little bit less than $2.2 billion is spent annually on flood management and a big chunk of that by locals. Locals cover most of the maintenance and they cover about half of the investment, and then the state and the federal governments come in with money, mostly to help with the investments.”
Ms Hanak noted that for the period of 2008-2011, the federal government provided about $250 million a year; the state about $575 million, and locals about $1.325 billion total. “Local agencies are raising some money for this, even though they are relying importantly on federal and especially increasingly state help,” she said.
In November of 2006, voters approved both Prop 1E and Prop 84 which provided $4.9 billion for flood protection. “This is new for California,” she said. “California was not used to using GO bonds for this purpose, and I think this really came in recognition of the fact there was a big investment gap.”
“The federal policy is for any project that’s authorized and has a chief’s report, local agencies are eligible for quite a large cost share, up to 65% in some cases, but the federal government just hasn’t had the kind of funds available to fund all the projects that would in principle qualify,” Ms. Hanak said. “That’s led to a long waiting list of projects and so the state has really stepped into help there.”
The Governor now proposes in the administration’s budget to spend the remaining funds from Prop 1E, $1.1 billion. “That will be big jump compared to the typical annual state spending that’s going to be really welcome, but then when that’s gone, look what’s in Prop 1 that just passed,” she said. “Not a whole lot, so not to diminish the value of every dollar that’s there, but clearly this is going to be on the agenda soon again in terms of finding state funds to bring in the state’s share.”
She presented a pie chart showing where the bond funds for flood management have been spent, noting that it was for a range of different things, with over half the funds spent on levees. She noted that this was mostly in the Central Valley, which was the focus of Prop 1E.
She then presented a slide depicting the flood investment gap. “The DWR Army Corps report estimated that California had a flood investment need of at least $50 billion,” Ms. Hanak said. She said they adjusted the numbers because they included funds for flood protection for water supply including peripheral canal or tunnels.
“When instead just put in money for shoring up Delta levees and not thinking about the water supply project, that gets you to about $34 billion,” she said. “If we spend that in 25 years, that is about $1.4 billion a year that we should be spending on investments, not including maintenance investments. … We have been spending about $600 million annually, so we have to more than double that, basically.”
The near term bond funds will help, but federal funds are lagging and won’t be increasing in the current federal budget environment, and locals face a lot of challenges in raising these funds due to Prop 218. “Some local agencies have been successful but they have to go to voters now,” she said. “Since 1996, it’s not the locally elected boards that can decide about the assessments; this has to go to voters and it’s hard to get them to approve things, especially if they already have 100-year protection.”
She then presented a graph breaking it down by region, explaining that the slide shows what happens on a per capita basis if the investment gap is filled with state funds or local funds. The green bar shows the per capita current level of spending on flood investments, the orange bar shows the per capita cost if the funds to fill the investment gap are generated locally, and the brown bar shows the per capita cost if the additional investments needed are funded through state bond funds. “Basically California has to double the amount of spending that we’re doing at the local level in order to fill this investment gap, about $30 per person statewide,” she said.
Ms. Hanak pointed out that the highest per capita costs are in the Sacramento Valley and San Joaquin River regions. “That’s because there’s a very high flood risk here, a big investment gap, and not as many people,” she said. “The way that we fund GO bonds is through the state general taxes, and those are heavily skewed towards income tax. The higher incomes are in the Bay Area and in the South Coast, so you can see that the Bay Area’s brown bar is bigger. It’s just something to consider in terms of what the ability to pay in different areas is and what the appropriate mix of funding is.”Ms. Hank then concluded with her thoughts on policy priorities:
“I think that the legislature in 2007 took some really important steps with a flood package for the Central Valley that raised urban protection standards to a 200-year flood, doubling the federal protection level,” she said. “New planning tools – the Central Valley Flood Protection Plan is a testament to that, really looking in a very sophisticated way at a lot of these issues and ecosystem objectives are being incorporated in very creative ways. We think that the state should consider extending these reforms to other regions. As you saw in that first graph with the maps, there are big risks elsewhere in the state as well.”
“Local agencies need more ways to raise funds and one of the things we suggested in our funding report was that the state could consider a regional fee enacted at the state level by legislature with the Governor’s signature that would allow funds that would not necessary require the local vote that Prop 218 requires for every local agency,” she said. “The state’s going to need to prioritize the bond funding, because there’s just not enough to go around to all of the needs, and we think in addition to thinking about liability issues that the state faces, that these multi-benefit approaches are especially valuable.”
Flooding in Southern California …
While the focus of this hearing was more on the flood risks for those in the Central Valley, significant flood risks exist in Southern California as well. Here’s more on the specific flood risks facing Southern California:
The report, California’s Flood Future, was produced by the Department of Water Resources and the Army Corps of Engineers, and provides a look at the statewide exposure to flood risk. More than 140 public agencies statewide provided information that was used to describe the problem and formulate recommended solutions.
The Who, What, Where and Why of Flood Control in the Central Valley: During the second portion of coverage from this hearing, representatives from the Central Valley Flood Protection Board, the Central Valley Flood Control Association, the Delta Stewardship Council, the Department of Water Resources, Army Corps and Cal Office of Emergency Services explain their roles in flood operations, management, and emergency response.
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