ANALYSIS:
The Business Case Analysis is a complex project and has taken quite a bit of time to develop the recommended scope of services with the consultant team and staff. While reports have been published noting the South Florida risk to sea level rise, analysis to assess the benefits of adaptation is new. As a ‘first of a kind’ analysis, staff has worked through multiple (five) draft proposals, with extensive discussions about the tasks, scenarios, data needs and analysis, and geographic study area. Staff worked to fine-tune the multiple approaches needed with the consultant team, including risk analysis, stormwater modelling, private property adaptation approaches, localized property value analysis, and communications.
In the RFQ, the business case study scope included “economic analysis(es) of the value of our risk reduction investments to address flooding and sea level rise. This analysis should explain the risk cost of inaction (in dollar terms) and the extent to which the risk cost is likely to be reduced as a result of the city’s infrastructure investments (also in dollar terms). The work may consider the complex relationship and impact(s) among City investments (that reduce risk to flooding and sea level rise) to the City’s property tax base, flood insurance, real estate market and financial mortgage cycles, and City credit ratings, land use issues, or any other factor that may be pertinent to the work”.
ICF has assembled a multidisciplinary team, including AIR Worldwide, Brizaga, Kimley Horn and FAU – to provide expertise in economics, property values, risk management, science, engineering and communications. Multiple departments have been engaged with developing the tasks, including the Chief and Deputy Resilience Officers, the Assistant City Manager and City Engineer for Public Works, the Chief Financial Officer, and the Risk Manager. This item has been discussed at the routine staff READY Team meeting.
The primary audience for this analysis is City decision-makers (including city managers and elected officials). Secondary audiences include the general public, community organizations, credit rating agencies, insurers, and others interested in the long-term resilience of Miami Beach. The outcome of this project will be compelling, concise communication materials for City decision-makers articulating the business case for resilience investments in light of sea level rise and storm scenarios, backed by a robust technical analysis incorporating integrated flood modeling and economic analysis. In addition, this project will produce a replicable methodology that can be scaled and used to support future decision-making. The economic analysis is designed to capture a wide range of the costs and benefits of resilience investments.
The deliverable for this work includes a cost benefit analysis of multiple scenarios, including a single family home, a neighborhood, and a citywide analysis. The analysis would include sea level rise and four-storm event types. It would and evaluate the cost benefits of no action, of public infrastructure investment, and of private adaptation investment (no, low, medium, and high effort).
The initial, highest end cost estimate for this work was $1,595,000. After many meetings and calls to define the scope, the proposed cost for the above tasks is now $395,000. The timeline to complete the full analysis is 12-months. The full scope of work is attached.
To fund the analysis, Administration recommends that the Finance and Citywide Projects Committee approve $395,000 for the tasks. The funding would come from two sources: $110,000 from the stormwater fund for the neighborhood-level integrated modelling, with the remaining $285,000 as a one-time expenditure from the FY 2018 budget surplus. This will be subject to a budget amendment on November 14, 2018.