Oceanfront property value could drop by up to 40% if federal beach nourishment funds are eliminated according to a recent study conducted by researchers from University of North Carolina Wilmington, Duke University and The Ohio State University. Through statistical modeling and analysis, researchers found that federal policy has the inflated the value of coastal properties and without federal nourishment funds, coastal property values would be severely impacted. The study also highlights the interconnectedness of coastal property value, coastal management policy and coastline behavior, “Human-occupied coastlines are strongly coupled systems, and policies that influence shoreline stabilization efforts become intrinsic drivers of economic value in the coastal zone” . In essence, shoreline protection policy including beach nourishment funding has become intertwined with the value of the coast and without it, there will be economic repercussions for homeowners, business owners and coastal communities alike.
Coastal property owners and communities are fiercely contesting federal and state proposals to reduce or eliminate beach nourishment subsidies and for good reason. Historically, the federal government pays 66% of the total costs of beach nourishment but without that money coastal communities would be forced to foot the bill and property values will steeply decline, “The reduction in property value would be pretty significant- anywhere from 10 to 20, 30, 40 percent” . As a result, local property taxes garnered from coastal properties would crash and negatively impact the local economy by limiting the ability of communities to provide goods and services (e.g., schools and roads).
Federal Beach Nourishment funding has steadily declined over the past ten years, with more and more going towards climate change preparedness. As demonstrated in Figure 1, the US Army Corp of the Engineers (USACE) budget for shoreline protection has dropped from a high of nearly $250 million in 2004 to a 10 year-low of $75 million in 2015.
Federal Beach Nourishment funding is not the only funding being hotly contested, FEMA recently announced that State Hazard Mitigation plans must account for climate change in order to be eligible for valuable FEMA preparedness and mitigation grant programs.
Noah Hersch, Public Policy Fellow
Warwick Group Consultants, LLC