Tuesday, April 25, 2023

Left Holding the (Sand) Bag

Who Will Pay for the Damage Caused by Flooding and Rising Sea Levels? It Could Be Your Homeowners Association!

(Editor's Note: This article was originally published a decade ago. Given the recent storms and resulting flooding, the concerns expressed below are even more compelling today.)

The San Jose Mercury News:

From Antioch to North Richmond to Redwood City, a slowly rising Bay could endanger the properties of as many as 270,000 Bay Area residents and cause some $56.5 billion in damage by the end of the century unless measures are taken to protect them, scientists warn. But surprisingly, few cities are taking action.” 

    City of Benecia Website: 

In the event of projected flooding, sandbags are available at the Benicia Corporation Yard. Some assistance may be available, but residents should bring shovels and plan to fill and load the bags themselves.

The chance of flooding in cities in and around San Francisco Bay and other low-lying areas in California is not just speculation. It has happened many times and will happen again and again if climate change and sea level rise continue or a “perfect” storm joins with normal high tides. It's easy to see why. Look at any map illustrating the first areas around the bay that will flood when the sea rises. It should come as no surprise that they are the exact locations where the bay was initially filled to create housing and commercial developments. These low-lying areas—Redwood Shores, Alameda, Vallejo, Alviso, and many others—were bay bottom and tidelands just a few decades ago. Now there are thousands of homes. The flood danger is obvious.

But what differs today from developments built three or more decades ago is that most of these new developments will be built as common interest developments. As a result, local or state governments will maintain little of the expensive engineered facilities necessary to protect these developments from storms, rising tides, and sea level rise but, instead, will be homeowners' responsibility.

Streets, storm sewers, parks, and sidewalks in older developments are maintained by cities and counties using tax dollars raised from a broad tax base. In newer projects, these “public” works are instead made the responsibility of private owner's associations. The advent of the community association was a boon to tax-starved local governments, which saw them as a way to promote development and raise new tax dollars while avoiding responsibility for the new infrastructure.

The cities and counties require developers to place the responsibility for necessary flood control improvements in community associations or small, special districts. Responsibility for Levees, settling basins, pumps, riprap, and retaining walls built by the developers of these new projects will eventually be maintained and repaired by community associations and paid for only by the owners who live there.

Local improvement, levee, or reclamation districts began this massive shift of responsibility away from governments and onto landowners and have been widely used for many years. Much of the Sacramento delta, a system of sloughs and islands on which more and more housing is being built and proposed, is maintained by such “special” assessment districts, not the state or local cities or counties. The taxpayers within those districts pay for all levee maintenance and repair work.

Originally these districts were formed to give farmers quasi-governmental authority over the properties in a particular area. It also shifted fiscal responsibility away from cities and counties and their broader base of taxpayers. But a flood disaster in an agricultural area will only inundate crops. The same disaster in a residential community will be much worse. So it matters who is in charge and who must finance the maintenance of such critical facilities.


A community association functions like a special district—ownership of public works is handed off by the developer to the association when development is complete, and the owners, through assessments, pay for the ongoing maintenance and repair. Cities and counties, which gain considerable tax benefits from new development, can nevertheless shift the long-term responsibility for maintaining improvements associated with that development to community associations. 

By this mechanism, developers avoid long-term responsibility for such projects. The homes and buildings within the development will be sold off soon. The developer takes the profits and is protected from long-term liability not only by the assessment arrangement that shifts the cost of future repairs to owners but also by various statutes that cut off legal liability in just a few years after the project is complete.

After that, the association, or special district, is on its own. So just as the liability for landscaping, streets, parks, even schools, and unstable hillsides has been shifted to local homeowners in recent years, the flood control improvements necessary to build housing on tidelands or low-lying areas is similarly transferred to homebuyers along with the deeds to their homes. The maintenance and repair obligations start immediately. Over time, the facilities may prove inadequate to forestall the inevitable rise in sea level or flooding due to climate change, leaving homeowners on the hook for a lot more.

That brings us to another problem. We have written many times about the looming failure of community associations to keep pace with the growing cost of maintaining even simple common area components—but imagine what will happen if much more sophisticated, not to mention expensive improvements, are to be maintained solely by owner assessments--levees and retaining walls, essential, for example, to keep sea level rise or "atmospheric rivers" from flooding hundreds or perhaps thousands of homes--will be dependent upon the willingness of individual homeowners and their association to provide adequate funding. It's one thing to let the landscaping go to seed or to allow chuckholes to exist in the parking lot, but a crumbling levee is at another threat level altogether.

Of course, the proponents of new development contend that it will benefit the economy. But this benefit is short-term--if it exists at all. In fact, the “benefits” are more likely to be realized only by the developers and the local taxing authority. There is lots of land available for the necessary housing where it would not be threatened by flooding, sea level rise, or liquefaction in the case of an earthquake. And its eventual owners would not inherit the potential for fiscal and physical disaster. Planning agencies should push development where owners can afford to maintain it long-term. 

Anyone concerned with new development proposals should ask the local jurisdiction a straightforward question: 

Who will be responsible for keeping these flood control improvements working in the future?

Don't be surprised by the answer.

No comments:

Post a Comment