THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, September 6, 1996 TAG: 9609060560
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY MYLENE MANGALINDAN, STAFF WRITER
LENGTH: 82 lines
It's difficult to determine where a hurricane will hit.
It's even harder to evaluate the costs involved in preparing for one of the elusive, destructive storms.
Although there hasn't been a forced evacuation of Hampton Roads in years, the lives - and livelihoods - of many have been disrupted by storms looming off the Atlantic coast. And that costs money - possibly tens of millions.
By one estimate, hurricane preparation can cost $670,000 per mile. The figure includes the expense of moving Navy warships out to sea, business and personal losses and the government's tab.
Because Hampton Roads is populous and home to the Navy's Atlantic Fleet, the costs of hurricane preparedness here could be much higher.
``It's hard to estimate the costs of a full-time event,'' said Mark Marchbank, deputy coordinator for emergency management in Virginia Beach.
There's no uniform standard - no hard-and-fast formula - for determining hurricane preparation costs.
After all, myriad factors play a role: What businesses do you track? When do you start compiling information?
The National Hurricane Center in Miami has taken a statistical guess.
In 1975, a study by the center estimated the cost of warning an average 300-mile section of coastline along the Gulf of Mexico to be $25 million.
The center initiated the study because a group of scientists wanted to justify putting more instruments on aircraft to narrow down the size of the hurricane warning area, said Charles Neumann, a research meteorologist who authored the report.
Neumann used five items to compile the $25 million baseline. He calculated municipal costs, which included private sector costs, evacuation costs, the military's costs of movingships or planes to evade damage, the expense accrued by large industries that shut production facilities, and expenses associated with oil rigs, both mobile and fixed.
``These are preparation costs,'' Neumann said. ``This is not damages. Whether the hurricane comes or not, it doesn't make any difference.''
Neumann and others applied that formula to the rest of the Atlantic coastline, from Texas to Florida to Maine. But he admits its deficiencies.
``This number is probably low because of some cost we haven't considered,'' Neumann said. ``They really need to redo it. What's got to be done is to have a real economist look at the real costs. There's a lot of small things that just weren't considered.''
Since Neumann's report, the preparation expense formula has been updated only once in 1992-93 to account for population and cost of living increases.
Revised evacuation costs for a 150-mile stretch of coast is estimated to be $670,000 per mile, said Frank Lepore, public relations officer for the National Hurricane Center.
Since the coast includes both populous metropolitan areas and barren rural country, the $670,000-per-mile figure represents an average.
In Hampton Roads, the figure could be much higher because the military's costs here are probably higher, Neumann said. He used military studies that looked at bases on the Gulf of Mexico, particularly Pensacola. Hampton Roads boasts the world's largest naval base as well as a large military-industrial complex spanning the region.
On the other hand, Neumann gathered municipal costs from a detailed report by the city of Miami. It described city expenditures when it shut down and sent city employees home for Hurricane Donna.
Those costs might need to be scaled down for this region because municipalities in Hampton Roads don't necessarily see hurricane preparation as a hard cash cost.
``It's reallocating your resources to meet needs,'' said Virginia Beach's Marchbank, deputy coordinator for emergency management. Most of the preparation before a hurricane hits Hampton Roads is just a part of the cost of doing business, he said. It's not treated as an extra expense, just lost opportunity costs.
``The city doesn't lose money, it loses productivity,'' Marchbank said. Hurricane preparation costs more only when the city must open shelters, which range between $5,000 to $10,000, Marchbank said. Virginia Beach opens about 20 shelters for a major hurricane.
``In the big scheme of things, that's not where the major costs are,'' said Jack Weber, director of the National Disaster Coalition, about preparation expenses. ``The major costs are in providing assistance after the fact, assistance to individuals and rebuilding.'' ILLUSTRATION: Color AP photo
[Damage in Key Biscayne, Fla., after Hurricane Andrew in 1992...]
KEYWORDS: HURRICANE DAMAGE COST by CNB