Monthly Archives: July 2019

“Hero insurance companies save thousands from fiery death-trap.”

If we were a culture that took climate change seriously, the tenor of this article would be completely reversed. As written, the article suggests that it is a problem that the high cost of insurance is preventing people from moving to high fire risk areas. Thus:

The refusal of insurance companies to cover homes in fire-prone areas is prompting home buyers to cancel purchases and look elsewhere.

That’s depriving struggling rural areas of one of their most reliable sources of economic oxygen — the steady influx of well-off retirees and other transplants from Sacramento, the Bay Area and other prosperous areas.

“It’s another … hardship that’s hit because of the wildfire issue,” said economist Jeff Michael of the University of the Pacific. “We tend to see lower incomes in those areas. People are attracted to them by the housing affordability and rising insurance costs put a real dent in that.”

Pounded by two straight years of catastrophic wildfires, insurers are raising rates, abandoning long-standing customers and refusing to write new policies. Many homeowners are forced to purchase from unregulated “surplus” carriers or the California FAIR Plan, a bare-bones policy that acts as the state’s insurer of last resort. The resulting coverage can cost up to triple what a traditional carrier would charge. Some desperate homeowners are getting quotes of up to $10,000 a year.

Realtors said this translates into lost business. Home buyers give up on purchases, or their lenders scuttle the deal because the borrowers no longer qualify for their loan.

Every single person who does not move into a high fire risk area is a success story. (Also true for floodplains, also true for water short areas.) It is a shame that the State does not have vigorous policies to keep people from moving into fire’s way, but if the same goal is being achieved by insurance companies accurately passing the cost of increasing risk onto those households, well, at least that’s a start.

In a culture that were genuinely afraid of the climate crisis, the same article would have my headline, a quote from a local fire chief who is pleased that he won’t have to defend some rural cabins, and quote from someone who lost their house to wildfire last year and wishes they hadn’t bought. There would be more from insurance executives, explaining how they priced the risk and how it is unfair to compel Californians as a whole to subsidize that risk pool.

The phenomenon that this article describes, that people are becoming aware of the magnitude of the risk (translated through money in an insurance bill) and hence, not moving themselves to the risk is a good thing. After a few more fire seasons, it’ll be reported that way.

So long as I’m talking to reporters, I’ll add that people who lived through foreseeable natural disasters shouldn’t be labeled “survivors” any more.  It glorifies them and sets the stage for rebuilding in place. After all, that label makes them, by nature, someone who survives stuff.  A better term for them would be “escapers.” “Escapers, this time”, would be even better.

***

This, from the same article:

Meanwhile, the inventory of unsold housing is piling up in the foothills. Janice Wechsler, an agent with Coldwell Banker Residential Brokerage in the rugged Foresthill area of Placer County, said the problem is worsening as homeowners, irate over rising insurance premiums, seek to get out. She’s hearing of longtime residents of the area looking at moving to Nevada, Oregon and Idaho.

“They’re being canceled, they’re watching their rates tripling or quadrupling,” Wechsler said. “It becomes the proverbial straw. They say, ‘I’ve had enough of this.’”

is fucking nuts. There is no appreciable difference in fire risk between where they live and their destination. They’ll just be underinsured when the fire comes.

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“The plans are so vague as to be worthless.”

The  Chico Enterprise-Record isn’t much impressed with the Water Plan Update 2018. My impression is that the Water Plan played it so safe that it became a meaningless list of every good thing, and my fear is that the Resilience Portfolio is headed down the same path. Fortunately, we will know as soon as the Resilience Portfolio is released, by locating it on the spectrum from safe to controversial.

Safe:

  • Information clearinghouse
  • Internal agency re-organization
  • State agency “alignment”
  • Decision support/decision “framework”
  • Creating an index/setting performance measures
  • Doing science
  • Giving out State money

All of those are essentially the State government masturbating. Not wrong, but none of them affect anything in the outside world. That’s why they’re safe.

Medium:

  • Finding “win-win” solutions
  • Doing something useful while ignoring EJ needs
  • Supporting local control
    • IRWM/GSA
  • Voluntary Settlement Agreements
  • Requiring plans (UWMP, AWMP, GSPs)
  • Enforcing existing laws
  • Recommending legislation (esp legislation that would cost anything)

Controversial:

  • Enforcing plans (UWMP, AWMP, GSPS) and holding districts accountable for not meeting plan goals
  • Doing something useful and acknowledging/meeting EJ needs
  • Correcting our godawful water rights situation
  • Using State authority over local government
  • Using State authority over local government without being obsequious about local control
  • any concept that challenges capitalism (instream flows, rights for rivers)
  • managed retreat before the calamity
  • anything that isn’t based on “economic growth”

If the Resilience Portfolio only makes it halfway through the mediums, it’ll deserve the same reception that the Chico ER gave Water Plan Update 2018.

(I am happy to add more items to the spectrum, if you leave them in the comments.)

 

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Brief thought: Can It Happen Here?

Very much enjoyed Plastrik and Cleveland’s paper Can It Happen Here? Improving the Prospect for Managed Retreat by U.S. Cities. Recommend. Here is an online summary. My brief thoughts follow.

Before this paper, I had considered that the alternative to managed retreat was post-disaster unmanaged retreat. Plastrik and Cleveland point out a different, pre-disaster retreat, in which people leave as they can afford it, leaving behind a patchwork too thin to support itself economically.  I had recognized this as a consequence of ag water markets, but not seen the application to urban systems.

***

Plastrik and Cleveland discuss the legal implications of retreat on page 36*:

Cities worry about whether certain retreat policies would trigger a ”taking” of property and its economic value and require compensation for the owners. For instance, in Del Mar, California, owners of oceanfront properties worth millions of dollars contended that the city’s consideration of managed retreat was devaluing their property.

I would like to see vigorous pushback against this error. The risk itself is devaluing the property. If the ocean were not going to move into the house, a city’s consideration of response options would not devalue the property.

I have further seen people object to planning for managed retreat because the planning effort might destroy the illusion that the house has future value. If that is the rationale for protesting the planning effort, then the clear solution is to destroy the illusion that the house has future value right away, and then plan for managed retreat. For example, by putting up a series of billboards in every coastal town, illustrating the reach of sea level rise. We cannot all pretend that a terrible thing is not coming because some homeowners want us to so that someone ignorant might buy their liability of a house.

***

At the bottom of page 24, Plastrik and Cleveland quote:

“People and communities who emerge from a storm often identify as ‘survivors,’” noted a Lincoln Institute of Land Policy report. “This sentiment makes them more likely to oppose retreat.”

Reporters could combat this tendency by referring to people who have survived natural disaster as “escapers” instead of “survivors.”

The Appendix (pages 40 – 41) list tool that cities could use to herd people away from disaster-prone areas. They range from zoning to buyouts, all to positively incentivize people away from the coast or floodplain. Honestly, I’d like to see more in the way of negative incentives –making it very expensive for people to stay.  Reflecting the true costs of insurance is the only one that I know of in current practice, and there is political pressure to buffer that. But charging people who won’t leave the shoreline for the lost beach and recreation, making them pay into funds for the clean-up of their homes when they collapse, that type of thing. The whole discussion is oriented around a positive financial pull for getting people out of risky areas, and (especially for the rich ones), I’d like to see more negative financial push.

 

 

*See, Professor Bendell? See how easy that was?

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