‘Jersey Smart’ Is Better than ‘Jersey Strong’

By | October 9, 2015

Earlier this week, I covered South Carolina’s “1,000-year storm,” questioning whether we can actually say with any kind of certainty that such events are, in fact, all that rare.

But South Carolina wasn’t the only state affected by the passage of Hurricane Joaquin hundreds of miles offshore. Today, I turn to a different meteorological event, and it’s one that sadly is not uncommon at all – massive beach erosion at the Jersey Shore.

Though Joaquin didn’t come close to the landfall feared by many Shore dwellers – still reeling from the devastation caused by Superstorm Sandy three years ago – the winds, pounding rains and tidal currents of its outer bands certainly had an impact. Refurbished and newly constructed seawalls struggled to hold the tides at bay. In communities like Bay Head and Ocean City, protective sand dunes – some just barely weeks old – were depleted and washed away. The Ortley Beach section of Toms River lost more than half its dunes.

The storm’s aftermath has exacerbated an already in-progress debate between local property owners and state officials, who have threatened to use eminent domain to construct more protective dunes as flood-control measures. Property owners object that the dunes will rob them of their oceanfront views, a position Gov. Chris Christie has deemed “selfish.”

In fact, this is a case where both parties are wrong. The dunes do serve a short-term purpose, and their cost may be justified in mitigating flood-insurance claims and disaster-relief assistance that otherwise will be borne by taxpayers. But over the long term, residential development of New Jersey’s barrier islands is a losing proposition. The sooner we get square on that point, the better.

New Jersey is home to 127 miles of Atlantic Ocean coastline, with the overwhelming bulk of it composed of a series of barrier islands. These include the 20-mile-long Barnegat Peninsula, which includes Point Pleasant Beach, Seaside Heights and a 10-mile preserve known as Island Beach State Park; the 18-mile Long Beach Island, which bore an outsized brunt of Sandy’s wrath; the six-mile Brigantine Island, just north of Atlantic City; Absecon Island, which includes Atlantic City and Margate; Ludlam Island, just below Ocean City; and Cape May County’s Seven Mile Island, Poverty Beach and the Wildwoods.

Then there’s Little Beach, a barrier island that isn’t connected by any bridge to the mainland and that is wholly contained within the Edwin B. Forsythe National Wildlife Refuge. Though it once was home to people, Little Beach has been abandoned since 1929 and is believed to be the last uninhabited barrier island on the entire Atlantic coast. A visit to Little Beach shows the Jersey Shore as it once was, and as it may someday in the not-too-distant future have to be again.

New Jersey has been losing shoreline for as long as it’s been inhabited by European settlers. A review of Monmouth County property records by Stockton University’s Coastal Research Center shows the shoreline has retreated by about 2,000 feet since roughly 1650. Sandy alone caused the average New Jersey beach to be 30 to 40 feet narrower.

But locals haven’t taken the loss of their precious shoreline sitting down. Instead, they’ve turned to federal agencies to finance beach “nourishment,” in which sand from elsewhere is carted in to replace what was washed away by storms and tides. A Western Carolina University database shows that, since 1936, about $1.5 billion has been spent on beach replenishment projects in the state, most of it federal money. That’s topped only by Florida, which has seen $2.3 billion of beach nourishment projects.

Of course, it’s worth keeping in perspective that Florida has 10 times the amount of coastline of New Jersey. A survey by the Coastal Research Center shows $1.2 billion has been spent on New Jersey beach nourishment in just the past 30 years, to purchase and spread 125 million cubic yards of sand.

Objections to beach nourishment don’t come just from those concerned about their ocean views. For one, it’s just simply bad risk management. Barrier islands’ greatest value lies in the fact that they protect the coastline, absorbing storms and flooding that would otherwise destroy mainland communities. Barrier island development not only robs them of much of their value as tidal barriers, but obviously places human lives and property directly in harm’s way.

As the Green Scissors coalition (of which, R Street is a contributing member) points out, the process of beach nourishment provides only a temporary solution, as federal taxpayers “pay millions every year to pump sand onto beaches, sand that inevitably and almost immediately washed back out to sea.” The nourishment program cost taxpayers $98 million in Fiscal Year 2015 and is projected to cost $978 million over the next decade.

Moreover, barrier islands are home to rich and fragile natural ecosystems. That’s why efforts like a $40 million project earlier this year to nourish beaches between the Monmouth County communities of Deal and Lock Arbour with 1.4 million cubic yards of sand drew the ire of both environmentalists and, especially, local anglers.

“All the sand will just go to Sandy Hook,” said Joe Pallotto, president of the Asbury Park Fishing Club and the former manager of the city’s beaches. “You need a camel out there to get to the water.”

What’s even worse, said Pallotto, is that the project will effectively turn a thriving ecosystem into a desert.

One area that will receive tons of sand is known as “jetty country,” a stretch of rockpiles and groins that act as a nursery for a wide variety of fish and marine life, and offers some of the best recreational fishing along the Atlantic coast.

“Would you bury a coral reef?” asked Greg Hueth, president of the Shark River Surf Anglers. “All that habitat will be filled in and destroyed and won’t come back. It’s like burying somebody alive.”

Beach nourishment also perpetuates a cycle that encourages yet more development. In a paper in the February 1998 edition of the journal Land Economics, Joseph Cordes and Anthony Yezer found that federal spending on beach enhancement and protection contributed to inducing excessive development in coastal areas. The authors’ analysis of 42 beachfront communities from 1960 to 1992 found an annual average growth rate of 3.9 percent, more than 50 percent greater than the 2.4 national average.

Congress recognized the folly of continued federal subsidies to develop barrier islands back in 1982, when President Ronald Reagan signed the Coastal Barrier Resources Act. Providing a model for conservative approaches to conservation, the CBRA sets aside 1.3 million acres of land and associated aquatic habitat – mostly along the Atlantic and Gulf coasts – in which there may be no federal subsidies to development. This includes no federal spending to build or rebuild roads, wastewater systems or potable water supplies, no disaster relief and no eligibility for the taxpayer-subsidized National Flood Insurance Program.

Alas, there was a catch, and it’s one that has proven particularly important in the Garden State. While the CBRA prohibited federal spending for new development, New Jersey’s barrier islands (with the notable exceptions of the previously mentioned Little Beach and preserves like Island Beach State Park) already were developed by 1982. Thus, they have enjoyed grandfather status and continue to receive federal subsidies to this day. As the map below demonstrates, very little of New Jersey’s coastline is included in the Coastal Barrier Resources System.


Exemption from the CBRA has meant that New Jersey has been a disproportionately large participant in, and beneficiary from, the below-market-rate coverage offered by the National Flood Insurance Program. New Jersey has $57.7 billion worth of property insured by the NFIP, which is behind California, Texas, Louisiana and Florida, which tops the nation by a long shot, with $467.7 billion of NFIP-insured property. The state also has 350,577 properties, with a combined value of $118.8 billion, at-risk of hurricane-driven tidal surge. That’s the third-highest total in the country, behind only Florida and New York.

But, in fact, in terms of flood insurance claims paid, New Jersey tops even Florida. Between January 1978 and July 2015, the NFIP paid out $5.7 billion in claims in New Jersey, compared to just $3.9 billion in Florida. Only Texas’ $5.9 billion and Louisiana’s $16.7 billion (nearly all of it from Hurricane Katrina) are higher than New Jersey’s tally.

One reason why is that, while New Jersey doesn’t face the same risk of catastrophic storms as Florida (or Louisiana or Texas, for that matter), it is home to an unusually high concentration of “repetitive loss” properties, many of them along the Jersey Shore. The losses won’t generally come in the form of totaled homes; in fact, they often are just a couple of thousand dollars. But when they are paid year after year, after each Nor’easter blows through, they certainly add up.

A decade ago, Congress tried to get its hands around the problem of properties insured by the NFIP that suffer repetitive losses. In 2004, President George W. Bush signed the Bunning-Bereuter-Blumenauer Flood Insurance Reform Act. As the act’s preamble notes, just 1 percent of the NFIP’s 5 million insured properties regularly account for roughly 25 to 30 percent of its losses, amounting to about $200 million a year. Most of these properties predate the introduction of Flood Insurance Rate Maps in the mid-1970s.

Under the law (originally titled the Two Floods and You Are Out of the Taxpayers’ Pocket Act of 2003), properties that suffer four or more losses of at least $5,000 each would be targeted for elevation, relocation, demolition or buyouts. In fact, the Federal Emergency Management Agency already long had authority to conduct voluntary buyouts, in cooperation with local communities (the feds pick up 75 percent of the tab), but these had not previously been tied specifically to NFIP claims.

Unfortunately, the bill didn’t actually appropriate money for the buyouts, and relatively little has been spent on the program, either before or after passage of Bunning-Bereuter-Blumenauer. Over the period of 1993 to 2011, FEMA spent about $2 billion to buy 37,707 properties nationwide

There are signs that may be changing somewhat, in the wake of Sandy. To his credit, Gov. Christie in May 2013 announced that he would devote $300 million of the federal Stafford Act funds the state received post-Sandy toward its “Blue Acres” program. Originally launched in 1995, Blue Acres uses public money to buy out frequently flooded properties and convert them to open space. The state intends to use the $300 million to purchase 1,300 storm-damaged homes at pre-Sandy market values. Through April of this year, 719 properties had been approved for buyouts, with 449 homeowners accepting offers.

Moving forward, programs like these – and not short-term patches like beach nourishment – increasingly should be seen as the appropriate response to storms, flooding and tidal erosion. As the world warms and sea levels rise, we’ll be fortunate if we don’t lose the barrier islands altogether. It would be a tragedy if the storm protection, recreational opportunities and natural habitats they provide were to be lost forever.

But they are simply not appropriate places for long-term residential settlement. Policy should be aligned with that principle in mind. A retreat from the Jersey Shore is inevitable, and we should hope to make that retreat as painless as possible. If any future funds are to be expended on development or redevelopment, then the beneficiaries – not the federal taxpayers – must absorb the costs.

In the wake of Sandy, the motto “Jersey Strong” became a shorthand for the state’s insistence that it would rebuild all that was lost. A commitment to “Jersey Smart” would be more appropriate.

About Ray Lehmann

Lehmann is co-founder of the R Street Institute in Washington, D.C. where he serves as director, Finance, Insurance & Trade, and is a senior fellow. He can be reached at rlehmann@rstreet.org. More from Ray Lehmann

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