As climate change causes unprecedented dislocation from flooding and sea-level rise, a new legal regime for climate retreat (i.e., shifting human settlement from severe climate risk zones) is developing. Buyout laws, such as FEMA’s Hazard Mitigation Grant Program, fund government acquisitions of severely flood-impacted homes, enabling owners to relocate, and require localities to rezone acquired land as open space. Despite the growing interest in flood buyouts as a tool for climate change adaptation, there has been little attention by policymakers or scholars to the capacity of buyouts to incentivize “buy ins” to flood zones by subsidizing flood risk-taking—a problematic irony given buyouts’ increasing role in climate retreat. This Article reconceptualizes buyouts from their current focus on dispossession to a form of climate transition relief that balances incentive effects against individual losses. Specifically, this Article advocates for a presumption against buyouts for flooded homeowners in order to curb incentives for high-risk housing choices. This reform would carve out a significant exception for low-income residents of floodplains and means test buyouts. In the face of severely constrained housing choice, unaffordable flood insurance, and high marginal costs from property loss, this group is less vulnerable to incentive distortion from compensation and more vulnerable to harm from dislocation. While this Article focuses on flood buyouts, the model of climate transition relief I propose can inform climate compensation and retreat policymaking more broadly.
Stephanie M. Stern,
Climate Transition Relief: Federal Buyouts for Underwater Homes,
72 Duke Law Journal
Available at: https://scholarship.law.duke.edu/dlj/vol72/iss1/3