Brown-John: Who should pay for floods, other climate change disasters?

Published May 31, 2024 • Last updated 12 hours ago • 3 minute read

Household items damaged by the flooding in Harrow are shown in front of a home on Maple Street on Sept. 5, 2023. Photo by Dan Janisse /Windsor Star

By: Lloyd Brown-John

As we move into summer here in Canada’s deep south it’s time to remind ourselves that summer can bring major flooding.

On Sept. 29, 2016, parts of Windsor and Essex County received 75mm of rain in 24 hours. This resulted in $108 million in flood-related costs. Even worse than the Great Flood of 2016 was another local rain deluge in August 2017 causing $124 million in estimated damages.

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Then there was the flood disaster in Harrow and Colchester last August 24. I’ve not been able to find an estimate of the total cost of that disaster but it certainly totalled in the multiple millions of dollars.

Both the federal and provincial governments have funds available to assist those affected by massive unanticipated flooding. Ottawa has two different programs, Disaster Financial Assistance Arrangements and the Federal Disaster Assistance Initiative.

Ontario has a Disaster Recovery Assistance for Ontarians fund which includes support of up to $250,000 per application for flood relief.

In 2018, the City of Windsor launched a Disaster Mitigation and Adaptation Fund largely in response to the 2016 and 2017 city floods. The Town of Essex, in light of last year’s Harrow area flooding, now has available flood protection subsidies.

But notice that this is all government-related or -sponsored disaster relief funding. Property owners in many disaster situations in Canada almost invariably look to governments for relief and bail-outs.

Can property owners be blamed for appealing to governments when insurers are hedging their risks given the increasing magnitude of natural disasters?

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Private insurance companies are beginning to either consolidate or shrink their risk exposure with higher annual premiums. Worst-case example might be that ostensible sun paradise Florida where annual premiums on a normal family home will likely cost owners around $11,700 this and into next year.

Just focusing domestically, a federal National Risk Profile found that many factors are increasing risks of flooding in Canada. Climate change is expected to impact flooding differently across the country in consequence of changes in precipitation, snow and ice melt, and water levels.

And increased urbanization is leading to more impermeable surfaces like parking lots, greenhouses and large industrial structures which often disrupt natural drainage systems.

Finally, there continues to be widespread commercial and residential development and other infrastructure construction on flood plains.

A flooded Erie Street North in Harrow is shown on Aug. 24, 2023. DAN JANISSE/Windsor Star Photo by Dan Janisse /Windsor Star

The Essex Region Conservation Authority (ERCA) is undertaking studies of both shoreline erosion and flood-prone areas in Essex County.

Homeowners in flood-prone areas eventually discover that property values decrease as flooding becomes more frequent, and insurance premiums simultaneously rise to account for increased risk.

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A study in 2018 in the “Journal of Urban Economics” found that homes constructed on flood plains incurred an eight-per-cent decline in value.

Ironically, two things are at play. First, governments and elected politicians are always keen to protect homeowners and businesses from consequences of climate change. Yet the pool of available funds ultimately depends upon dollars derived from those same homeowners and businesses that cannot sustain long-term subsidization of costs incurred by property owners due to floods and other disasters.

Hence the second area of government involvement — what are usually termed transition risk costs. What incentives can governments offer to encourage property owners to reduce their carbon footprint?

For example, the watchdog International Energy Agency estimates that large buildings alone are responsible for 18 per cent of global energy-related emissions. So how do governments create incentives to assist in reducing that contribution to climate change?

And in the case of unusual floods, what can those living on flood-prone areas do to prepare for future potential disastrous floods?

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Climate change is not something happening elsewhere. It is impacting Canada, Ontario, and especially here in our country’s deep south.

The basic question all of us should grapple with is simple: how long can governments at all levels seek to shield home and property owners from increasing risks associated with a climate clearly under transition?

Insurance companies seem to understand those risks, but can governments afford to keep stepping in to cover what those businesses no longer covere?

Lloyd Brown-John is a University of Windsor professor emeritus of political science and director of Canterbury ElderCollege. He can be reached at lbj@uwindsor.ca.

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