Ppeople are becoming increasingly concerned about how they will be affected when rising seas engulf coastal properties. For starters, there are homeowners who live on the threatened land. In addition, there are mortgage lenders and home insurers who have a financial stake in these properties. But indirectly, anyone who relies on public education, fire departments and other municipal services should worry when parcels of land fall below the high tide line. Because when the land disappears, so does the property tax revenue it generates to fund these public services.
The threat of this loss of revenue to American communities was freshly illustrated in a earth risk analysis published Thursday by Climate Central, an organization focused on tracking how extreme weather and rising sea levels affect local communities. According to the report, individual properties along the US coast – a total of 75% of New Jersey – are projected to be partially or completely submerged in about 30 years. Billions of tax dollars are likely to wash away with them, straining government and school district budgets.
Findings derived from water boundary data from the National Oceanic and Atmospheric Administration and sea level rise models from United Nations Intergovernmental Panel on Climate Changeshow that nearly 650,000 tax parcels totaling 4.4 million acres may be affected, with 48,000 of them entirely within the high tide line by 2050. By 2100, the number of affected parcels doubles in compared to the 2030 figures, and the number of affected buildings jumps sixfold because as you move further inland, the number of residences and commercial spaces becomes denser.
“Our ancestors decided to build [there] because we thought it was safe,” said Don Bain, senior adviser at Climate Central, in a press conference ahead of the report’s release. When the waters enter these communities, the problem “gets worse, very quickly.”
However, not every coastal region has the same level of risk. Consider that the model shows a global average sea level rise of 8.4 inches between 2000 and 2050. However, look at this model and some areas like Alaska where melting land ice is causing the land to rise and the sea level to fallwill see no change or even lower sea levels, while other places like Miami Beach, Florida, Galveston, Texas, and Grand Isle, Louisiana, will have to contend with 12-inch, 19-inch, and 23-inch sea-level rises, resp.
As these examples show, East Coast and Gulf Coast communities are under the greatest threat. Climate Central, which released 250 county-specific reports, found that 87% of the country’s affected area is concentrated in just four states: Louisiana (8.7% of the state’s total land), Florida (1.8%), North Carolina (1.3%), and Texas ( 0.2%). These states also have the highest number of individual tax parcels affected, as the chart below shows, with Louisiana having the most properties that will be 100% submerged.
When the tides overwhelm the land, the people who live there have to shoulder the financial burden in several ways. First are the immediate emergency and infrastructure repair costs. On top of that, there is a systemic decline in revenue as property values depreciate and the tax base shrinks as people migrate away from eroding coastal lands. The report notes that when the properties are abandoned, the cost of them is likely to fall to the government, adding new costs.
These losses have a knock-on effect on police and fire departments, public transportation, parks and public housing—not to mention public schools. According to Lincoln Institute of Land Policy, statewide public education revenue totaled $771 billion in the 2018-2019 school year, nearly half of which came from local government sources. Of this local revenue, about 36% comes from property taxes.
Using data from Regrid.com, a company that collects property tax information, Climate Central attempted to put a dollar amount on that loss by conservatively estimating lost property taxes by 2050 in counties that have assessment data. . While this is only a partial financial picture, the numbers are still staggering: Florida has $7 billion at risk in 44 counties. Texas and North Carolina each expect about $5 billion in potential tax losses in nine counties and 21 counties, respectively. (Too many counties in Louisiana did not have data for the researchers to make an estimate.)
Although many homes are still not abandoned or falling into the water dramatically, the properties they sit on are getting smaller and some coastal cities are struggling with landowners who expect their taxes to go down in tandem to reflect their smaller lots. But in other cities, the exact opposite is happening: despite clear evidence that water is taking over the land, rebuilding and new construction continues right along the water’s edge.
In one example, Bain presented to Climate Central a map of property parcels on Dauphin Island, Alabama, where more than a dozen parcels were entirely on the water. “We have properties that are now underwater as a result of coastal erosion and property owners who are still receiving property tax bills associated with those properties that they can no longer use,” he said. Still, federal aid and insurance allowed payments to the island to constantly recover.
Some experts hope that by estimating property tax losses, even if the numbers are in their infancy, local governments will begin to generate more honest conversations about how much waterfront property is worth. “There’s a lot of effort to not reveal it [flood] risk to keep those numbers artificially high,” said AR Siders, an assistant professor at the University of Delaware’s Center for Disaster Studies, who was not involved in the report but spoke on the call with reporters. “We are still building in these flood-prone areas [because] we’re so obsessed with having more property value, more property tax revenue.”
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