New Analysis Shows Federal Government to Save Nearly $2 for Every $1 Invested in Flood Prevention

WASHINGTON, D.C. - Today, at the request of U.S. Senator Jeff Merkley (D-OR), Ranking Member of the Senate Budget Committee, the nonpartisan Congressional Budget Office (CBO) released a report detailing that every $1 the federal government invests in flood adaptations can save taxpayers nearly $2 in disaster spending, as well as reduce National Flood Insurance Program (NFIP) claims.

"Every year, billions of taxpayer dollars are spent cleaning up and restoring the damage caused by flood waters. From coastal towns to rural communities, climate change related events are exasperating federal resources that are allocated to help families rebuild from these costly disasters," said Merkley. "Today, CBO confirms that a simple way for the federal government to be a better steward of taxpayer money, is to invest in flood adaptation methods-such as repairing local dams and levees or working to elevate high-risk properties. We owe it to the American people to make investments that will not only protect their property and surrounding community but also save lives."

In his June letter, Merkley specifically asked CBO to estimate the amount of potential future savings that could accrue to the federal government for every dollar it spends on flood adaptation and mitigation. A previous CBO report published in September 2024 detailed how spending for adaptations can reduce flood damage.

CBO breaks down the 30-year savings as for every $1 billion spent in prevention in present-value terms:

• Future flood damage costs will decrease by $3 to $4 billion,
• Taxpayers will save $1.8 billion in disaster spending, and
• NFIP claims reduced by $300 million, mostly benefiting ratepayers through lower premiums.

CBO's full report is HERE.

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