Federal Spending for Flood Adaptations

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.

• Data Underlying Figures and Table

• Flood Damage Avoided by Potential Spending on Property-Level Adaptations: Working Paper 2024-03
  May 28, 2024
• Flood Damage and Federally Backed Mortgages in a Changing Climate
  November 13, 2023
• Communities at Risk of Flooding
  September 13, 2023
• Army Corps of Engineers: Budgetary History and Projections
  November 29, 2022
• FEMA's Disaster Relief Fund: Budgetary History and Projections
  November 29, 2022
• Expected Costs of Damage From Hurricane Winds and Storm-Related Flooding
  April 10, 2019
• Potential Increases in Hurricane Damage in the United States: Implications for the Federal Budget
  June 2, 2016