Government Flood Assistance - What's Fair?

[CaptainYooh]

I was hoping this would not be about potential changes to flood insurance or prevention but rather what would be the best (or the least unfair) way to compensate flood victims now. I can only sympathize with this task that all government levels are faced with at this time. There is no win-win scenario here.

[pylon]

Personally, I am of the opinion now is the perfect time to address this once and for all. High River is all but destroyed, I would much rather see the gov't buy all those people out in a one shot deal at fair market value, but they cannot rebuild the town there. Yeah it will cost a lot more now, but it will save the government money and resources over the long haul. I sympathize with them, but you can only sympathize so long if you CHOOSE to live in such a vulnerable area that has been proven over and over and over and over to be a stupid place to live.

This is the third time in my lifetime they have has the same crisis. Rebuild the town somewhere where it isn't floodable, or if you choose to stay, you are on your own next time financially.

[Kavvy]

Originally Posted by pylon

Personally, I am of the opinion now is the perfect time to address this once and for all. High River is all but destroyed, I would much rather see the gov't buy all those people out in a one shot deal at fair market value, but they cannot rebuild the town there. Yeah it will cost a lot more now, but it will save the government money and resources over the long haul. I sympathize with them, but you can only sympathize so long if you CHOOSE to live in such a vulnerable area that has been proven over and over and over and over to be a stupid place to live.

This is the third time in my lifetime they have has the same crisis. Rebuild the town somewhere where it isn't floodable, or if you choose to stay, you are on your own next time financially.

Fine... but we the tax payers then have to FULLY pay for relocation.

And while I don't 100% disagree with you... it is different when you are talking about someone else's home.

It is different when you need to move your own life.

Your making it sound simply by the word "choose", it isn't that cut and dry when relating to someones home.

[pylon]

Originally Posted by Kavy

Fine... but we the tax payers then have to FULLY pay for relocation.

And while I don't 100% disagree with you... it is different when you are talking about someone else's home.

It is different when you need to move your own life.

Your making it sound simply by the word "choose", it isn't that cut and dry when relating to someones home.

And I certainly don't disagree with you either. It would be very difficult for all involved. But it seems insane to keep putting a band aid on the same wound over and over. Eventually you have to sew the wound shut permanently. Isn't it Einstein that said the definition of insanity is the doing the same thing over and over and expecting different results? Something has to be changed here. I guess it is a matter of figuring that out.

[Rudee]

Without a doubt there will be many people who will be profiting from this. Especially after the numerous donations are disbursed.

[Table 5]

Originally Posted by pylon

And I certainly don't disagree with you either. It would be very difficult for all involved. But it seems insane to keep putting a band aid on the same wound over and over. Eventually you have to sew the wound shut permanently. Isn't it Einstein that said the definition of insanity is the doing the same thing over and over and expecting different results? Something has to be changed here. I guess it is a matter of figuring that out.

Sorry to do this, but it's neither the definition, nor is there any proof that Einstein said that.

[Rathji]

Originally Posted by SebC

So the government should provide insurance. It should have premiums and an uncapped, percentage deductible.

Simply providing insurance for free distorts the market in favour of the floodplain dwellers. Having said that, if the floodplain dwellers are net subsidizers despite their free insurance, then you charging them insurance premiums would increase the market distortions that favour suburbia... which means you need to eliminate both the suburban subsidy and the floodplain subsidy together.

Totally agree.

[SeoulFire]

Originally Posted by SebC

So the government should provide insurance. It should have premiums and an uncapped, percentage deductible.

No it shouldn't. Some areas just may end being unisurable as dictated by the market. If insurance companies are not willing to offer the product, I see absolute no justification for the government to do so either. People can make their own choices on whether to live there or not on the absence of insurance.

Simply providing insurance for free distorts the market in favour of the floodplain dwellers. Having said that, if the floodplain dwellers are net subsidizers despite their free insurance, then you charging them insurance premiums would increase the market distortions that favour suburbia... which means you need to eliminate both the suburban subsidy and the floodplain subsidy together.

It is just as easy to reframe the situation to say that the higher tax burden on the 'floodplain dwellers' (FDs) is simply an insurance premium (assuming government assistance will follow) levied by the government. Thus, the FDs are not actually subsidizing the suburbs, but simply paying market value for such insurance. The size of coming financial aid can then be measured against the FDs tax premium to determine if it was in fact sufficient or if it should be increased.

I see why you do this—distorting the facts and reframing everything to fit your own views is kind of fun!

[SebC]

Originally Posted by SeoulFire

No it shouldn't. Some areas just may end being unisurable as dictated by the market. If insurance companies are not willing to offer the product, I see absolute no justification for the government to do so either. People can make their own choices on whether to live there or not on the absence of insurance.

The problem with that is that if you don't insure them, then you end up bailing them out without recovering your costs from them. Telling people "too bad, you chose to live on a floodplain" isn't politically viable, but telling them "we're going to create an insurance program that you can use" could be.

Originally Posted by SeoulFire

It is just as easy to reframe the situation to say that the higher tax burden on the 'floodplain dwellers' (FDs) is simply an insurance premium (assuming government assistance will follow) levied by the government. Thus, the FDs are not actually subsidizing the suburbs, but simply paying market value for such insurance. The size of coming financial aid can then be measured against the FDs tax premium to determine if it was in fact sufficient or if it should be increased.

That's almost what I said, except that not all subsidizers are "FDs". There's high ground in the inner city too. Furthermore, there are far less basements per capita in a condo building. Building up is a great way to deal with floodplain issues!

[Nage Waza]

Originally Posted by SebC

The problem with that is that if you don't insure them, then you end up bailing them out without recovering your costs from them. Telling people "too bad, you chose to live on a floodplain" isn't politically viable, but telling them "we're going to create an insurance program that you can use" could be.

But the insurance program cannot pay for itself, which is the exact reason insurance companies don't provide it. This flood might cost $1,000 per house in Alberta if everyone is 'bailed' out. In other words, if only those that needed this insurance bought into it, it would cost thousands per house. Probably around 20,000 to 100,000 per house. Who knows when the next flood is going to happen.

I think we are all better off if these people didn't have developed basements.

[SebC]

Originally Posted by Nage Waza

But the insurance program cannot pay for itself, which is the exact reason insurance companies don't provide it.

Sure it can. You just have to set the rates appropriately. I suspect that the reason private companies don't do this is that if they had to pay out in year one, they'd go bankrupt. That doesn't apply to the government.

On the other hand, a private company that doesn't insure floods would never have to pay for one. Whereas voters can force to the government to cover the ininsured.

Originally Posted by Nage Waza

I think we are all better off if these people didn't have developed basements.

I agree. And I think that if having an undeveloped basement would lower their premiums, there'd be less developed basements. But an insurance-based solution, where your premium is tied to the value of your insurables, would allow people to have a developed basement as long as they are willing to bear the costs for it. And I like that.

[Northendzone]

I worry about some hotshot lawyer who lived on the elbow river looking at the governments offer and the starting a class action suit looking for more money........it is going to be a mess when the government announces thier plan.

And, I agree that something more drastic has to be done in high river. The risk needs to be mitigated somehow.

[GGG]

I would like to see basements not covered in the 50 year flood plain or maybe even the 100 year flood plain. There is no reason to put in a basement that will destroyed within the lifespan of the house. Put caveats on the titles that basement development will not be covered.

If you live in an area that would get 1st floor damage in a 25 yr flood you should be forced to raise the first floor of your house or not rebuild or if the area is large enough and the flood prevention measures cheap enough structures like the inglewood berm should be built to prevent future incidents.

High River is a good example, the areas that are below the banks of the river that get flooded every time the highwood spills its banks should not be rebuilt. The areas with just flooded basements should be repaired for living but not the basements.

[Bownesian]

We were flooded just into the basement ceiling but fortunately not over the main floor.

The basement of our house has flooded thrice in the last 20 years so we're looking at taking any money we get and putting it into building living space over the attached garage rather than over-developing the basement like it was. For the basement, our plan now is mould-resistant or treated metal studs and closed-cell spray foam insulation for the walls (with paneling rather than drywall) and some kind of flood-hardened flooring like tile or rubber or epoxy like in the hospitals or something that can be washed clean next time. We'll use it for some low-risk storage, a sparse spare bedroom and as a big open area for the kids to bomb around in, not as a real living space like before.

[Slava]

Originally Posted by SebC

So the government should provide insurance. It should have premiums and an uncapped, percentage deductible.

Simply providing insurance for free distorts the market in favour of the floodplain dwellers. Having said that, if the floodplain dwellers are net subsidizers despite their free insurance, then you charging them insurance premiums would increase the market distortions that favour suburbia... which means you need to eliminate both the suburban subsidy and the floodplain subsidy together.

Why do you have to turn every thread into this discussion? We get it. You want the city limits to end at 17th avenue in the south and 16th avenue in the north. I, for one, can't wait until the day you buy a property and its in the suburbs!

[Northendzone]

i wonder what percentage of those who had basements damaged by the flood, had thier basements developed without obtaining the permits, and thus side stepping property taxes?

Just one more consideration for the folks trying to figure out the compensation formula.

[Ark2]

I don't really understand why the government should be paying anything to flood victims. Don't get me wrong, I am sympathetic to those that have had to endure it, and certainly don't blame anyone for wanting government assistance, but I am not sure how this is the government's responsibility. I'll probably get flamed for this but oh well...

[Hack&Lube]

Fortunately my only flood loss was some minor water damage to underground storage with no major valuables and hundreds of dollars in spoiled food due to an untimely Costco run just prior to the flood and power outage.

I wouldn't expect anybody to cover that, I just have to eat it (as in the cost, not rotten food).

It makes sense to me that basements in a floodplain should be considered a liability in the first place but downtown is springing up with condos with parkades and personal storage rooms, etc. all below ground. All the newish condos by Eau Claire and by Stampede all had flood damage in their parkades and many still can't return. What about those places where hundreds are affected in a single building?

[GGG]

Originally Posted by Hack&Lube

Fortunately my only flood loss was some minor water damage to underground storage with no major valuables and hundreds of dollars in spoiled food due to an untimely Costco run just prior to the flood and power outage.

I wouldn't expect anybody to cover that, I just have to eat it (as in the cost, not rotten food).

It makes sense to me that basements in a floodplain should be considered a liability in the first place but downtown is springing up with condos with parkades and personal storage rooms, etc. all below ground. All the newish condos by Eau Claire and by Stampede all had flood damage in their parkades and many still can't return. What about those places where hundreds are affected in a single building?

I would say that contents of parkades in the hundred year flood plain should not be bailed out by governments. By buying a Condo with a storage area below river level you risk losing everything in the storage area if the river spills its banks. It should be your risk. Given a flood of somekind was predicted on the Monday there would have been ample time for people to move expensive items from their storage up into their Condo.

Cars are covered under autoplans so should not be covered by the government.

The Parkades themselves should be covered as a part of the Condo's insurance plan. Like businesses I believe that Condo's can get flood coverage (not sure on that). If not than the Parkade itself, not the contents should be covered by flood relief.

I wonder if parkades could be sealed off from flood waters with berms that erect themseles around the doors.

[photon]

Originally Posted by GGG

The Parkades themselves should be covered as a part of the Condo's insurance plan. Like businesses I believe that Condo's can get flood coverage (not sure on that). If not than the Parkade itself, not the contents should be covered by flood relief.

Some are, my condo sent out an email that they have flood coverage in the insurance (if they use it or not depends I guess on the cost and the deductible etc).