Leading Through the Storm

Craig Fugate led the response to Hurricane Sandy while serving as administrator of the Federal Emergency Management Agency (FEMA) from 2009 to 2017. At the helm during 500 presidentially declared natural disasters and emergencies, he helped restore Americans’ faith in the government’s ability to respond to disasters. Before leading FEMA, Fugate was Florida’s emergency manager under Governor Jeb Bush (R) during the state’s 2004 and 2005 hurricane seasons, which included seven named storms, most notably Katrina.

Out of public office, Fugate continues to work to improve the way the United States prepares for and responds to natural disasters and has consulted with Pew’s flood-prepared communities project. He’s particularly keen to reduce the federal government’s exposure to the costs associated with disasters and identify ways for communities and states to increase their investments in mitigating flood risks.

Laura Lightbody, the project’s director, sat down with Fugate to learn what actions the Trump administration and Congress can pursue to make the nation more flood resilient.

Q: During your eight years as FEMA’s “disaster chief,” you coined the term Waffle House Index. What exactly is that and why does it matter?

A: Yes, the Waffle House Index was first developed in the aftermath of Hurricane Charley in 2004. The Category 4 hurricane affected Florida, South Carolina, and North Carolina, where dozens of counties were damaged to various degrees—some flattened, others not so bad. When we drove the convoy into the affected area, we didn’t know how far to go before we stopped to reach the most severely impacted survivors.

We needed to respond quickly. So we started a stoplight index to track each area: red, yellow, and green. It included many factors ranging from schools being open to road closures. We eventually added the restaurant chain Waffle House’s openings and closings to that list because we knew they had a consistent plan across their locations. If Waffle House had the capability to serve a full menu, then it was green in the area. If they had no power and only grills and a limited menu, yellow. When a Waffle House was closed, that merited a red light, meaning other factors led to its closure. That is where we would send our mass casualty teams and start the work in those areas.

Q: Research shows that for every dollar invested in preparedness efforts, 4 dollars are saved in future benefits. Are we budgeting enough for mitigation?

A: Almost 90 percent of the money we spend on flood risk reduction comes in the aftermath of a big flood. It’s good to rebuild the right way, but we also have to prepare before disasters because those investments will be more effective and well-thought out. In theory, FEMA’s Pre-Disaster Mitigation program is a good tool that states and communities can use to prepare beforehand, but it just doesn’t get the funding to make enough of a difference. This needs to change.

Q: You oversaw the National Flood Insurance Program as FEMA’s administrator. That program has faced a lot of criticism. From your perspective, what needs to improve?

A: First let’s identify the problem: Far too many properties in the United States are at risk of flooding, and the private sector won’t insure them. So in the immediate term, there is a role for the NFIP to play to insure existing properties that aren’t otherwise insurable. Many of those are classified as repeatedly flooded properties. But when it comes to new construction, we need to stop building in flood zones and stop growing the risk. That means incentives for families, communities, and the private sector to not build in high-risk areas. This starts with a vigorous discussion about how communities and states make decisions on where and how to build.

Q: What should Congress do to make the program solvent for the long term?

A: The program’s financial risk is only increasing. Congress can direct FEMA to stop writing policies for new construction in flood zones. That would kick-start the conversation for a long-term solution that will help the program become more stable and hopefully raise awareness about the costs, both economic and physical, of living in risky areas.

On flooding as a whole, nationally, we need to understand our risk. FEMA’s flood maps could be updated to portray all the areas at risk of flooding. Many of the homes that flooded in Hurricane Harvey were outside zones where flood insurance was required, which understandably caught homeowners by surprise. The worst thing we can do is create a false sense of security for homeowners and communities. Under the current structure, that’s exactly what is happening. The first step to being resilient is having and using the right information to help us prepare. Congress needs to make this a priority. 

Q: What were the most important lessons learned from Hurricane Sandy and the other disasters you managed as FEMA’s administrator?

A: When it comes to the lessons of Sandy, I think the real lesson is that we’ve been underwriting and underpricing disaster risk in this nation for too long, and as a result, so many people live in places that flood that it’s reaching tipping points where public policy will have no choice but to accept change.

What happens far too often is we have lessons observed instead of lessons learned. They’re not necessarily changed behaviors on the parts of the society or government. Lack of understanding and lack of preparedness put many people in harm’s way. The challenge is to get the public, especially those with the resources, to take on more responsibility to prepare.

Q: What can be done as a country to reduce flood risk, make people safer, and bring down disaster costs?

A: We’re making it too easy to build in risky areas. Strengthening local and state building codes is the best way to get ready for more severe weather. But federal disaster relief under current law only kicks in once uninsured damage passes a certain threshold, about $1.35 per capita. That creates a perverse incentive for local governments to take steps to limit their losses. We need to do a better job on the front end managing how we pay and what we pay for. We don’t have to abandon communities, and the resilience of the Florida Keys shows that. Just make sure they build in nonflood risk areas.

One solution I proposed during my time with FEMA was to only pay for damages past the threshold, rather than the entirety of losses. So for a state like Florida, disaster damages would have to exceed roughly $25 million before the government started paying 75 cents for every dollar of uninsured losses. And to incentivize better hazard mitigation, the feds could lower that threshold if states took proactive steps on flood planning or building codes.

Q: What are the pressure points to make sure that we rebuild from disasters in the right way?

A: People should be demanding from their representatives in Congress that we rebuild in a way that protects our investments. Hurricanes are a tremendous burden to the federal taxpayer, so everyone—whether they are in a risky area or not—is paying for all these disasters. This is reaching the point where if the public is not demanding more accountability from Congress on how they invest their tax dollars before and after disasters, the bill keeps going higher. Why are we building back to fail when the next disaster hits? It’s our money. We’re paying. And unfortunately we will pay again and again and again.