Local capacity and resilience to flooding: community responsiveness to the community ratings system program incentives

Abdul-Akeem Sadiq () and Douglas Noonan

Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, 2015, vol. 78, issue 2, 1413-1428

Abstract: To incentivize more community flood risks mitigation, the US Congress implemented the community rating system (CRS) in 1990. The CRS seeks to help communities build capacity to address flood risks and become more resilient to future flood disasters. Communities participating in CRS can reduce their flood risks and enjoy discounted premiums (up to 45 %) on federally required flood insurance commensurate with their community’s CRS score. A participant community is placed into one of the ten classes depending on its CRS score. Although previous research finds that the program’s structure creates opportunities for communities participating in CRS to respond to its incentives, no study has examined the characteristics of communities that changed their mitigation behavior due to this incentive scheme. In order to evaluate the performance of CRS and its tiered incentive structure, this study investigates the extent to which communities are responding strategically to CRS incentives and the characteristics of those communities behaving strategically. This study uses a regression discontinuity approach to compare the characteristics of communities above and below CRS class thresholds. The results show strategic behavior of communities participating in CRS. Communities with more information-based flood management activities, lower property values, lower flood risk, and lower population densities are more likely to respond strategically with respect to smaller CRS subsidies. For larger subsidies, the results indicate that CRS communities with higher property values are more likely to respond strategically to the policy incentives. The study concludes with a discussion of the implications of these results for the CRS program. Copyright Springer Science+Business Media Dordrecht 2015

Keywords: Local capacity; Resilience; Community rating system; Flood management; Climate change; Natural hazard (search for similar items in EconPapers)
Date: 2015
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DOI: 10.1007/s11069-015-1776-9

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