Three ways to make home buyouts more efficient

By: Gabrielle Rosario, EDF Intern

Each year, flood risk increases from sea level rise and storms, raising major concerns among millions of homeowners. Flooding can inundate homes, damage property and cause safety and health concerns, as well as isolate residents from essential government services like trash pickup or emergency vehicle access. In fact, by 2030, over 20 million Americans will be at risk of inundation due to sea level rise, and many will be unable to afford to move.  

Managed retreat policies, such as voluntary home buyouts, can facilitate the relocation of residents out of increasingly flood-prone communities. But unfortunately, existing federal programs are slow and require local governments to meet complex and challenging guidelines. 

Innovative approaches are needed to make buyouts more efficient. Here are three strategies that can help: 

1. Establish state-level buyout programs

States can establish state-level flood buyout programs in which a state department funds, organizes and manages home acquisitions in local governments. On average, these programs are faster, less complex and provide more flexibility compared to federal programs. 

A great example is New Jersey’s Blue Acres program, a state buyout program under the Department of Environmental Protection (NJDEP). Since its founding in 1995, the NJDEP has spent $190 million to acquire more than 1,000 properties with an average processing time of six to 12 months to complete, compared to an average five years for buyouts funded by the Federal Emergency Management Agency (FEMA). And in 2022, the state allocated another $50 million to continue to grow this impactful program.

Blue Acres also builds strong relationships with localities by inviting them into the decision-making process through comprehensive community engagement and outreach. Additionally, NJDEP employs staffers with diverse backgrounds, including human ecologists, planners and social workers that have the capacity and technical expertise to help localities through each step of the process.

2. Develop state or local funding mechanisms to finance buyouts

States can help fund local buyout programs and reduce the cost-share requirements of federal programs, which can be a burden for local governments with limited budgets. 

For instance, state bonds can shorten a buyout process from 18 months to as little as three. States may also use revolving loan funds, which provide low-interest loans to localities and are funded by interest and principal payments from older loans so the program can operate cyclically. Finally, states can use grant programs, which provide debt-free funding to localities for flood buyouts.  

Local governments can also choose to fund buyouts with their own budgets, which are on average quicker and allow for greater control over the process, which can lessen burdens to meet complex federal requirements.  

Charlotte-Mecklenburg, North Carolina serves as an example of a successful locally-funded buyout program. As the area was unable to meet the complex requirements laid out by FEMA, the county created its own funding mechanism. The program now utilizes funding from local stormwater utility fees, allowing the county to streamline its process and quickly purchase homes after floods. Since 1999, the program has purchased more than 400 properties, and the buyouts take an average of six months to complete. 

3. Build capacity for local buyout programs

Many local communities lack the expertise and capacity to apply for federal funding and are unable to implement buyouts on their own. An effective strategy is for federal and state agencies to provide technical assistance or training to local governments on buyout applications.  

At the federal level, FEMA and the U.S. Department of Housing and Urban Development should develop buyout training modules for communities, including grant application workshops or cost-benefit analysis training. They can also increase funding for staffing at the state level, which would assist communities applying to federal grants. 

Increasing state agency staffing across multiple departments can also provide support for local governments, including training, templates, technical advice and interim reviews to localities, which in turn builds local governments’ capacity to implement buyouts. Greater staffing could also improve transparency of government actions during buyouts, as there are more staff dedicated to communicating with residents to explain the process. This can thereby build residents’ trust in government, leading to smoother implementation. 

With flood risks increasing across the country in coastal and inland areas alike, we need more tools in the toolbox to make our communities more resilient to climate change. Improving access to and the effectiveness of voluntary flood buyouts will help Americans adapt to a climate-driven future. 


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