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North Carolina’s private dams create large public problem | Leveraging Opportunity Zones for Resilience

This post is a part of our series on private infrastructure resilience – or lack thereof – during major disasters. Learn more here.

In October 2016, Hurricane Matthew made landfall in North Carolina, covering the eastern part of the state in 15 inches of rain in less than 24 hours. Since the region had been hit by Tropical Storm Julia just weeks earlier, watersheds were already inundated with rain. The combination caused catastrophic flooding. Some of the worst effects of the hurricane were in Cumberland County, where towns like Fayetteville experienced multiple dam failures, including several privately owned dams. Private ownership, however, did not prevent these failures of private property from wreaking havoc on residents and public infrastructure.

North Carolina emergency services evacuate Fayetteville residents during Matthew
North Carolina emergency services evacuate Fayetteville residents during Matthew – Army National Guard, 382nd Public Affairs

In one part of Fayetteville, two privately owned dams carried the roadways to a neighborhood of 220 homes, with one dam uphill from the other. When the road across the lower dam was deemed an extremely high hazard by the state and closed by the local homeowners association, the residents were left with one roadway. Though the city had started before Matthew to build a new road and to work with the owners to repair the dams, neither had been completed. The upper dam failed, releasing the lake behind it and overtopping the lower one. Since the original ‘safe’ roadway was washed away, the neighborhood could only be evacuated across the damaged lower dam “at great personal risk”, many choosing to leave on foot.

Beyond the immediate risk to safety posed by such failures, the consequent flooding in Fayetteville dropped homes prices by an average of $100,000. Even as residents struggled to rebuild, citizens, developers, and government officials continued to argue over who should be responsible for funding and repairing the dams. This is especially critical because if a dam does not meet FEMA standards, the residents it protects may not be eligible for flood insurance. In 2018, residents in Fayetteville and the surrounding area began receiving FEMA Hazard Mitigation Grants to buyout, elevate, and reconstruct homes in the floodplain. Many more residents are still hoping for federal funding to repair or rebuild their homes, and, especially in areas where the dams had failed and had yet to be repaired, property values remain low.

Residents were also waiting on FEMA to fund fixes failed infrastructure outside of immediate public safety, like the privately owned Devonwood Dam that was built to create a recreational lake. The city had originally put forth a plan to pay for private dam repairs, but since public funds can’t legally pay for private repairs, it would have required a financing assessment charge to residents under wide protest. By April, 2018 North Carolina began receiving millions in FEMA Public Assistance Grants to repair roads and bridges, including $1 million towards the Devonwood Dam. As residents currently brace for Hurricane Florence, funds for repairs to infrastructure and homes may have come too late.

This week, it is especially clear that devastating flooding events will continue to occur. The immediate safety and long term viability of communities cannot wait for local, state, and federal entities to battle over responsibility and allocations of funds. However, since the resilience of such privately owned infrastructure has large impacts on property values and private investments, there is an incentive for local investment. Perhaps due to the damage from Matthew, there are currently several Opportunity Zones in Fayetteville, incentivizing private investment and development in the town. Unless steps are taken to protect the town against future flooding, any new investment will be at risk during future disasters.