While emergency managers review and analyze disaster mitigation, preparedness and response efforts in New York and New Jersey after Hurricane Sandy, the immediate question for many businesses and residents of the affected region is how and whether to rebuild homes and business centers. The faster Congress acts to augment funding and financing tools for the region, the sooner residents can demonstrate their resilience in the face of disaster.
Congress provides three types of assistance through the Disaster Relief Fund: individual assistance such as temporary housing, public assistance to rebuild public infrastructure and facilities, and hazard mitigation assistance to reduce future hazards. Congress also typically establishes a package of federal tax relief and tax incentives to encourage reinvestment in hard-hit areas such as the Gulf Coast after Hurricane Katrina and the Midwest after the 2008 floods. Working within the framework of the sequester and emergency supplemental appropriations, Congress can and should do more to rebuild from these disasters ó not by spending more but by leveraging private investment in public-good projects. This can be accomplished with tools such as:
The Water Resources Development Act
Congress has already initiated hearings on this legislation to reauthorize the Army Corps of Engineersí work with state, local and county officials to study and implement a plan to reduce the risk of future flooding along the coast and to protect business districts from future disasters.
Economic Development Assistance Programs
Congress has the ability to provide additional authority to the Department of Housing and Urban Development and the Department of Commerceís Economic Development Administration for grants to leverage state, local and private resources for capital-heavy projects that serve as regional economic anchors. These grants are typically only a small share of the overall project cost.
The most recent transportation bill, MAP-21, authorizes funding for highways, bridges and mass transit. But it also provides cost sharing for state and local projects, such as pedestrian walkways. Amending this bill can perhaps help restore one of the most prominent boardwalks in the U.S.
Private financing leveraged with federal grants, loans and loan guarantees is an increasingly acceptable method of financing large-scale development projects. Congress has previously reduced private risk in projects such as toll roads and rail corridors that have dedicated revenue streams. The same can hold true for water and wastewater systems, taxes dedicated to rebuilding the boardwalk and a coastal- flood or tsunami siren warning system or other disaster mass notification system.
Reducing the cost of redevelopment and encouraging charitable investments are important incentives in disaster response. Tax credits attract private investment dollars to large-scale redevelopment and rehabilitation projects.
These tools are readily available and should be considered by Congress in assisting a region hard-hit by the latest natural disaster. This disaster relief can come faster, smarter and cheaper than past disasters with the right financial assistance tools.
Andrew Garfinkel is a principal of Aronnax Public Strategies LLC in Washington, D.C. Adam Kaufman is a principal of the Kaufman-Zita Group in West Trenton, N.J.