Flooding is the most expensive and common natural disaster in the U.S., and managing flood risk is critical to protecting homes, local and regional economies, and community well-being. Faced with this potential crisis, local governments increasingly turn to buyouts as one strategy to cost effectively reduce flood risk, offer relief to residents and potentially improve access to open space in urban areas, the Urban Land Institute says in a new report, On Safer Ground: Floodplain Buyouts and Community Resilience. 

However, to achieve the fullest success, these measures require long-term strategies. That’s an area where greater private-sector involvement can reap community benefits.

“Floodplain buyouts are just one of several tools that governments can use as part of a climate resilience strategy, and their increasing use by governments may be a signal for the private real estate sector to prepare for more involvement in the practice,” says Leah Sheppard, manager of the ULI Urban Resilience program and lead report author. “As more land use decision makers avail themselves of this approach, innovation in policy and partnership models may help break barriers for buyouts.” 

A floodplain buyout is a property acquisition in which a government agency purchases private property, demolishes any structures on it, and preserves the land as open space, as an area that absorbs excess water, or for both purposes. Although buyouts are currently almost entirely used for residential properties in the U.S., the increased use of the approach in urban areas has important implications for all real estate types and also for future land use regulation and climate resilience strategy. 

On Safer Ground provides examples of communities that have successfully implemented floodplain buyouts and leveraged purchased sites for open space or other community amenities. They include the following:

• In 1995, New Jersey created a state program called “Blue Acres.” After Superstorm Sandy ravaged the state and destroyed hundreds of coastal homes in 2012, the Blue Acres staff ramped up its work to counsel homeowners considering a buyout. This buyout program provides support for relocation assistance to property owners and tenants in flood-prone areas.
• Due to extreme demand to protect its sewers and pipes, North Carolina’s Mecklenburg County, home of Charlotte, created a stormwater utility. The fees created by this utility have created a constant revenue stream for its Floodplain Buyout program, which has acquired more than 400 properties and returned more than 180 acres to floodplains to natural land and open space. 
• Harris County in Texas, the home of Houston, has faced catastrophic floods for decades. In response, the Harris County Flood Control District mounted the Voluntary Acquisition Program to identify property in likely inundation paths and work with residents. It finds success on two paths: delivering public spaces that control flooding impact and executing buyouts that rescue homeowners. 
• The Church Creek drainage basin, in Charleston, SC, has repeatedly flooded, affecting nearly 50 townhouses. In 2015, after a 1,000-year flood event, the city of Charleston bought out residents and embarked on the Church Creek basin resilience project, which will mitigate flooding for the surrounding community by delivering a 20-acre greenway and park system that will offer water storage during weather events and a new amenity. 

Pictured: Flooding in Houston as a result of Hurricane Harvey.