Disaster Preparedness for Economic Development

In the wake of another year with record-breaking storms and other natural/manmade disasters, Camoin Associates is emphasizing the importance of disaster preparedness planning and disaster recovery as part of our strategic planning work. Disasters that strike without warning, such as hurricanes, earthquakes, floods, damaging winds, tornadoes, and wildfires, can lead to economic disruptions ranging in severity and duration. While we hope our communities are never affected by these things, we simply have no control over the matter (or do we?).

We can’t prevent mother nature from wreaking havoc, but we can help communities prepare, recover, and rebuild, thus reducing the scope of the disruption. This article is part one of a two-part series that will outline best practices in mitigating damages caused by those unexpected disasters, informed by a series of International Economic Development Council’s (IEDC) Disaster Preparedness & Economic Recovery webinars.

A disaster can be broken into four phases:

(1) Mitigation, (2) Preparedness, (3) Response, and (4) Recovery.

The first two phases are preemptive while response and recovery are reactionary. Today, we will focus on the former. Disaster preparation creates the foundation for your community to lessen the impact of disaster, and when done correctly, saves lives and alleviates damage to properties and businesses. While preparing your community before a disaster strikes there are several best practices to keep in mind:

Prepare a Plan of Action

A disaster plan aims to guide a community through a disaster and quick recovery. A disaster plan should consider all hazards from natural disasters, disease epidemics, homeland security, and civil unrest. It is important to be realistic with your preparation plan, realize you cannot address everything at once. There is a need to be strategic – that’s where economic development organizations (EDOs) come in.

EDOs analyze the economic situation at hand and work to anticipate how disasters could impact businesses and industries within a community. Their leadership strategically coordinates and leverages resources to prepare a community for possible disasters. EDOs educate the business community on planning efforts such as emergency management plans. When a disaster strikes, EDOs work first hand on the recovery initiative. For a comprehensive disaster preparation plan, EDOs must work with the community and key stakeholders to create action strategies and priorities that are attainable given the current economic climate.

The goal of a disaster preparation plan is to increase the resiliency of a community through informed decisions. There are several key components that a disaster plan should include:

  • Resource registry – Taking inventory of all resources available to a community can ensure resources are used efficiently in times of disaster. For example, florists in a community will not have much business demand after a hurricane. At the same time grocery stores’ refrigeration systems may be negatively impacted from the disaster, thus reducing refrigeration capacity. Utilizing florist refrigerators in times of low florist demand and high food refrigeration need can help the community to be agile, as well as reduce the need for additional outside resources.
  • Workforce planning – Workforce issues may arise as a result of a disaster. The disaster plan should address solutions to these issues before a disaster strikes. For example, an area floods and a service worker’s house is destroyed. The worker does not have flood insurance and/or cannot afford to fix the damage and is therefore forced to move out of the region, thus leaving an occupation unfiled. On a large scale this creates a combination of low unemployment and high demand for workers in an area. In order to avoid this issue, a community should have systems in place to keep workers in the region despite disasters. Preemptive measures would include temporary housing options, training and retention plans, as well as transportation plans to alleviate any damages to commute infrastructure.
  • Business re-entry – Some businesses may not have adequate inventory, employees, or customer base in place to re-enter the market after a disaster. Incorporating business re-entry into the disaster plan can improve businesses’ ability to respond to events and enhance the community’s capacity to rebuild. The business re-entry plan should grant priority to businesses that are necessary in the recovery effort and/or businesses that are well-prepared to support recovery operations. Health care, utilities, and infrastructure repair services are highly demanded following disasters and therefore should be granted priority.
  • Strengthened communication – Strengthen communication capabilities amongst EDOs, local government, and business associations is necessary to build capacity and resiliency. Together, these organizations should work to gather funding, reduce utility outages and physical damage, and develop a management support system that monitors disaster impacts and encourages timely and effective recovery actions. These organizations should have a communication plan in place that enables them to continue communication throughout all stages of a disaster to ensure efficiency and reduce duplicative efforts.
  • Redevelopment and reuse – A disaster that damages physical infrastructure may force a community to rebuild and redevelop. Discussing these potential damages and redevelopment priorities prior to a disaster can help a community and its EDOs strategically develop a plan of action. Strategies included in the plan should focus on land use and environmentally sensitive areas as well as identify sources of capital and funding for redevelopment. The econometric model, REMI, can be used to determine the induced impact of catastrophic event and appropriate aid request. EDOs and the community should have open discussions to improve building codes, building materials, and other items to increase resiliency of communities.

EDOs should work with the community to continue having open discussions about potential disasters and revisit and revise the plan of action as necessary.

Identify Funding and Financing

Disaster remediation can be costly on a community. National Oceanic and Atmospheric Administration reports that natural disasters cost America approximately $306 billion in 2017 alone.[1] EDOs and communities should work to identify sources of capital that can be utilized by businesses before a disaster strikes. This includes state and federal funding as well as financing from local institutions and private organizations. EDOs and stakeholders should create an inventory of these options and continually work with financing institutions and private organizations to further understand the range and availability of these options.

There are several creative ways to secure financing for businesses including, gap and bridge financing, low interest financing, and forgivable loans. Establishing a reserve fund or purchasing disaster insurance are other ways a community and its businesses can to mitigate against financial loss and hardship. These funding mechanisms should be developed within a community before a disaster so that they can be immediately implemented throughout recovery.

Part of securing funding and ensuring financing options are readily available is opening the line of communication with possible funding agencies. Reaching out to state and federal agencies, partners, and stakeholders before a disaster hits can help communities better navigate recovery efforts in the wake of a disaster. Fostering this inter-agency coordination can create an environment that is conducive to recovery.

Engage the Community and Local Businesses

Local government cannot work alone in creating a continuity plan, encouraging the community and local businesses to aid in the preparation process is fundamental in helping the community to recover quickly. Generally, most small businesses lack a plan to guide them through a disaster should one occur. Creating an environment that enables community members and business owners to work together through potential disaster issues will help to initiate disaster planning for businesses. This can be done through continuity training programs and workshops that aim to identify actions or methods to remediate business disaster issues such as disruptions to business reentry, access to property, loss of data, and creating remote work locations. These programs and workshops should keep an open discussion about roles and responsibilities within the community as well as lay out a plan for information dissemination post disaster. Ultimately, this engagement will create awareness and educate the business community to create a more responsive environment should a disaster occur.

For more information on how to prepare for a disaster please visit: http://restoreyoureconomy.org/preparedness/

Stay tuned for part two of this series which will highlight disaster recovery.

 

[1] NOAA National Centers for Environmental Information (NCEI) U.S. Billion-Dollar Weather and Climate Disasters (2018).

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Saratoga Springs, NY 12866
518.899.2608
info@camoinassociates.com

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