LSU AgCenter economist Matt Fannin, left, briefs local government officials on financial considerations surrounding natural disasters, such as a hurricane. Fannin spoke at a financial resilience seminar May 13 in Lake Charles. (Photo by Bruce Schultz)
News Release Distributed 05/16/14
LAKE CHARLES, La. – An LSU AgCenter financial expert conducted a financial resilience seminar May 13 to help local governments plan for disasters.
With hurricane season just around the corner, Matt Fannin, of the LSU AgCenter Center for Rural Initiatives, advised local government representatives to think long-term.
Statistics show the chance of a major storm hitting most Gulf Coast regions in Louisiana during the next 50 years exceeds 50 percent, Fannin said. That pattern was confirmed when Hurricane Audrey hit southwest Louisiana in 1957, followed 48 years later by Hurricane Rita.
Fannin said local governments should make financial preparations to cope with a disaster because the Federal Emergency Management Agency is no longer likely to pay for all the costs.
“The days of FEMA picking up the entire tab are long gone,” he said. In order to qualify for disaster assistance, the damages must comply with a formula that may prevent aid to rural areas.
The more likely scenario after a disaster is partial assistance for damages and cleanup, Fannin said. “It’s like a co-pay on your health insurance.”
It’s likely that most local governments have begun planning for a disaster, Fannin said, “but they may not know the complete liability from a storm.”
Establishing a line of credit or creating a specific disaster emergency fund would be one way for a local government to prepare. Contractors cleaning up storm debris are more likely to offer a lower price for their work if early payment can be provided, he said.
Governments can gauge potential costs by using computer models or damage amounts sustained by nearby parishes and municipalities from previous disasters.
The LSU AgCenter is willing to assist and advise local governments to help plan for the long-term and short-term expenses of coping with the aftermath of an unexpected event, Fannin said.
Fannin and Carol Franze of the LSU Sea Grant program have written a handbook “Community Decision Support to Local Governments in Budget Planning Under Coastal Risk” to assist with financial preparations.
The event was attended by representatives of Lafayette city-parish government, Governor’s Office of Homeland Security and Emergency Preparedness, the parishes of East Feliciana, Cameron, Calcasieu, Vermilion and Lafourche, and several LSU AgCenter agents.
Bruce Schultz