Report Says Seattle Dam Threatens $30 Billion Worth of Property

By | December 18, 2009

Flooding beneath the damaged Howard Hanson Dam in Washington State could cause $30 billion, according to a new report from a Texas firm, First American Spatial Solutions.

State estimates about the value of property that might be damaged in a flood beneath the dam have been $2 billion to $4 billion.

Don Parkes, senior director of business solutions for First American, said that company undertook its study at the behest of its client insurance companies because there has been so much uncertainty about how much property might be at risk if there is flooding, and what the value of that property is.

“There has been a lot of information available, but it has been somewhat conflicting,” Parkes said.

According to Stephanie Marquis, a public affairs officer in the Office of the Insurance Commissioner, somewhere around 20 percent of properties in the potential flood zone in the Green River Valley have federal flood insurance, and only about 20 companies write surplus lines.

“Even if property owners can get insurance, it is very expensive,” she said.

Many of the properties are thought to need surplus insurance. The National Flood Insurance Program has a limit on coverage of $500,000 for a building and $500,000 for its contents. But, commercial properties make up a preponderance of properties at risk. The lower Green River Valley is home to the second largest warehouse and distribution center on the West Coast. There is also a lot of fabrication and manufacturing, much of it servicing the Boeing Company.

The problem that some property owners have had getting affordable surplus flood insurance prompted Commissioner Mark Kreidler to ask state lawmakers earlier this year for the authority to create a joint underwriting association.

The dam, which is located in Kings County, south of Seattle, was noticed by the Army Corps of Engineers to be damaged following a massive rain storm in January of last year. The Corps found erosion of one of the abutments, and categorized the dam as unsafe, a designation reserved for less than 5 percent of the country’s 80,000 dams. Predictions put the risk of flooding as high as one in three chances.

The water level of the reservoir behind the dam was lowered, and last month the Corps announced that it has buttressed the abutment and improved levees along the river. The Corps said the chance of flooding was reduced to odds of 1 in 25.

The main risk of flooding is not from the dam breaking loose from its abutment and bursting, but rather from the level of water behind the dam rising so high that the Corps would have to release a greater amount of water so the dam would not burst, Parkes said.

The difference between the $30 billion estimate of First American and the $2 billion to $4 billion of the state and the Federal Emergency Management Agency is due to the fact that their report suggests many more properties would experience flooding, Parkes said. FEMA is currently in the process of updating its flood maps.

The report considers two scenarios. One is the flooding that would occur if 13,900 cubic feet of water per second were released from the dam, and the other if 25,000 cubic square feet of water per second were released.

FEMA estimates that 5 square miles of land would be affected by flooding if the lower amount of water were released, while the report suggests that 15 square miles would be inundated. At the higher amount, the report says 20 square miles would be inundated. FEMA’s estimate of the land parcels affected is 1,140. The report says that 4,065 parcels would be affected by flooding if the lower amount were released, and 5,072 if the higher amount.

The full report is available at and underwriters can contact to the company to have the risk assessed for any particular property.

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