CBO provides information about the amount of damage that could be reduced through spending for flood adaptations—projects aimed at preventing damage from flooding.
The federal government provides funds for flood adaptations—projects aimed at preventing damage from flooding. Those projects include constructing dams and levees, restoring beaches, and elevating or buying out individual properties. In this report, the Congressional Budget Office provides information about the amount of damage that could be reduced through spending for flood adaptations.
Flood Damage. Over the past 10 years, damage from flooding in the United States has averaged $46 billion per year (in 2023 dollars). That damage is projected to be a quarter to a third greater in 2050 because of increases in flood risk due to climate change.
Federal Spending for Flood Adaptations. Since 2020, most federal funding to reduce flood risks has been appropriated to the Army Corps of Engineers and the Federal Emergency Management Agency (FEMA). Annual and supplemental appropriations for that purpose in 2022 totaled $15 billion; about half of that amount was funding provided by the Infrastructure Investment and Jobs Act.
Reductions in Damage Due to Adaptation Spending. Although the effects of adaptation projects can vary widely, estimates from the Corps indicate that two-thirds of its projects—excluding those with the highest one-sixth and lowest one-sixth of benefit-cost ratios—were expected to reduce flood damage by $2 to $6 per dollar of spending over a 50-year project lifetime. For those projects, the average expected reduction in damage was $3 for each dollar spent. CBO’s assessment of FEMA’s flood adaptation projects indicates roughly $2 in expected reductions in damage for every dollar spent. (All of those estimates reflect the value of future costs and benefits at the time the projects were planned.)
Beneficiaries of Spending. Benefits from reductions in expected flood damage accrue primarily to households and the federal government. Businesses and state and local governments also benefit, but to a lesser extent.
