Limiting the Federal Government's Fiscal Exposure by Better Managing Climate Change Risks
Climate change is considered by many to be a complex, crosscutting issue that poses risks to many environmental and economic systems—including agriculture, infrastructure, ecosystems, and human health—and presents a significant financial risk to the federal government. Among other reported impacts, climate change could threaten coastal areas with rising sea levels, alter agricultural productivity, and increase the intensity and frequency of severe weather events. As observed by the United States Global Change Research Program (USGCRP), the impacts and costs of weather disasters—resulting from floods, droughts, and other events—will increase in significance as what are considered “rare” events become more common and intense due to climate change. In addition, less acute changes, such as sea level rise, could also result in significant long-term impacts. According to the National Research Council (NRC), although the exact details cannot be predicted with certainty, there is a clear scientific understanding that climate change poses serious risks to human society and many of the physical and ecological systems upon which society depends, with the specific impacts of concern, and the relative likelihood of those impacts, varying significantly from place to place and over time.
These impacts call attention to five areas where government-wide improvement is needed to reduce fiscal exposure, including, but not limited to the federal government’s role as (1) the leader of a strategic plan that coordinates federal efforts and also informs state, local, and private-sector action; (2) the owner or operator of extensive infrastructure such as defense facilities and federal property vulnerable to climate impacts; (3) the insurer of property and crops vulnerable to climate impacts; (4) the provider of data and technical assistance to federal, state, local, and private-sector decision makers responsible for managing the impacts of climate change on their activities; and (5) the provider of aid in response to disasters. As a result, we added Limiting the Federal Government’s Fiscal Exposure by Better Managing Climate Change Risks to the High Risk List in 2013.
One way to reduce the potential impacts of climate change is to enhance resilience. The National Academies define resilience as the ability to prepare and plan for, absorb, recover from, and more successfully adapt to adverse events. When discussing climate change, the term adaptation—defined as adjustments to natural or human systems in response to actual or expected climate change—is synonymous with enhancing resilience. Adaptation is a risk-management strategy to help protect vulnerable infrastructure and communities that might be affected by changes in the climate. It includes, for example, raising river or coastal dikes to protect infrastructure from sea level rise, building higher bridges, and increasing the capacity of storm water systems. State and local authorities are responsible for planning and implementing many types of infrastructure projects. Decisions at these levels of government can drive the federal government’s fiscal exposure.
As we reported in April 2013, enhanced resilience means reducing potential future losses rather than waiting for an event to occur and paying for recovery afterward. Enhancing resilience can create additional up-front costs, but could also reduce potential future damages from climate-related events that—given expected budget pressures—would otherwise constrain federal programs. As stated in a 2010 NRC report, increasing the nation’s ability to respond to a changing climate can be viewed as an insurance policy against climate change risks.
Furthermore, according to NRC and USGCRP, the nation’s vulnerability can be reduced by limiting the magnitude of climate change through actions to limit greenhouse gas emissions. We recognize that (1) the federal government has a number of efforts underway to decrease domestic greenhouse gas emissions, and (2) the success of greenhouse gas emissions reduction efforts depends in large part on cooperative international efforts. However, limiting the federal government’s fiscal exposure to climate change risks will present a challenge no matter the outcome of domestic and international efforts to reduce emissions, in part because greenhouse gases already in the atmosphere will continue altering the climate system for many decades, according to NRC and USGCRP.
 Melillo, Jerry M., Terese (T.C.) Richmond, and Gary W. Yohe, eds., Climate Change Impacts in the United States: The Third National Climate Assessment, U.S. Global Change Research Program (Washington, D.C.: U.S. Government Printing Office, May 2014). USGCRP coordinates and integrates the activities of 13 federal agencies that conduct research on changes in the global environment and their implications for society. USGCRP began as a presidential initiative in 1989 and was codified in the Global Change Research Act of 1990 (Pub. L. No. 101-606, § 103 (1990)). USGCRP-participating agencies are the Departments of Agriculture, Commerce, Defense, Energy, Interior, Health and Human Services, State, and Transportation; the U.S. Agency for International Development; the Environmental Protection Agency; the National Aeronautics and Space Administration; the National Science Foundation; and the Smithsonian Institution.
 NRC is the principal operating agency of the National Academy of Sciences and the National Academy of Engineering. NRC, Committee on America’s Climate Choices, America’s Climate Choices (Washington, D.C.: 2011). See also NRC, Climate Change: Evidence, Impacts, and Choices. Answers to common questions about the science of climate change (Washington, D.C.: 2012). For more information about NRC’s recent reports on climate change, click here.
 The National Academies, Committee on Increasing National Resilience to Hazards and Disasters; Committee on Science, Engineering, and Public Policy; Disaster Resilience: A National Imperative (Washington, D.C.: 2012).
 GAO, Climate Change: Future Federal Adaptation Efforts Could Better Support Local Infrastructure Decision Makers, GAO‑13‑242 (Washington, D.C.: Apr. 12, 2013).
 NRC, Panel on Adapting to the Impacts of Climate Change, America’s Climate Choices: Adapting to the Impacts of Climate Change (Washington, D.C.: 2010).
In the atmosphere, greenhouse gases absorb and reemit radiation within the thermal infrared range of the electromagnetic spectrum. This is the fundamental cause of the greenhouse effect, or the warming of Earth’s atmosphere. In order of their prevalence by volume, the primary greenhouse gases are water vapor, carbon dioxide, methane, nitrous oxide, and ozone.
 The focus of this high-risk area may evolve over time to the extent that federal climate change programs and policies change.
The President's June 2013 Climate Action Plan and various executive orders, task forces, and strategic planning documents identify climate change as a priority and demonstrate commitment and top leadership support. This leadership commitment needs to be sustained and enhanced to address the federal fiscal exposure to climate change. As evident from the proliferation of climate-related efforts at different federal agencies, the federal government has some capacity to address the fiscal exposure posed by climate change, but existing actions and strategies do not clearly define the roles, responsibilities, and working relationships among federal, state, local, and private-sector entities, or how such efforts will be funded, staffed, and sustained over time. There are no programs to monitor and independently validate the effectiveness and sustainability of federal efforts to reduce the fiscal exposure posed by climate change. Thus, there is no way to demonstrate progress in implementing corrective measures.
Government-wide improvement is needed to reduce fiscal exposure in five areas, including, but not limited to, the federal government's role as (1) the leader of a strategic plan that coordinates federal efforts and also informs state, local, and private-sector action; (2) the owner or operator of extensive infrastructure such, as defense facilities and federal property vulnerable to climate impacts; (3) the insurer of property and crops vulnerable to climate impacts; (4) the provider of data and technical assistance to federal, state, local, and private-sector decision makers responsible for managing the impacts of climate change on their activities; and (5) the provider of aid in response to disasters.
Federal Government as Leader of National Strategic Plan
For its climate strategic planning efforts, the federal government was rated as partially met for Leadership Commitment, Capacity, and Action Plan, and not met for Monitoring and Demonstrating Progress. The federal government is not well organized to address the fiscal exposure presented by climate change, partly because of the inherently complicated, crosscutting nature of the issue. We reported in 2009 that, while policymakers increasingly viewed climate change adaptation as a risk-management strategy to protect vulnerable sectors and communities that might be affected by changes in the climate, the federal government's emerging adaptation activities were carried out in an ad hoc manner and were not well coordinated across federal agencies, let alone with state and local governments. Subsequently, our 2011 report on climate change funding found no coherent strategic government-wide approach to climate change. This report also found that federal officials do not have a shared understanding of strategic government-wide priorities.
The federal government would be better positioned to respond to the risks posed by climate change if federal efforts were more coordinated and were directed toward common goals. With regard to providing climate-related information, NRC observed that no single government agency or centralized unit could perform all the required functions, and that coordination of agency roles and regional activities is a necessity. In 2009, we recommended that the appropriate entities within the Executive Office of the President, such as the Council on Environmental Quality (CEQ) and the Office of Science and Technology Policy, in consultation with relevant federal agencies, state and local governments, and key congressional committees of jurisdiction, develop a strategic plan to guide the nation's efforts to adapt to climate change, including the establishment of clear roles, responsibilities, and working relationships among federal, state, and local governments. We also recommended in May 2011 that the appropriate entities within the Executive Office of the President clearly establish federal strategic climate change priorities, including the roles and responsibilities of the key federal entities, taking into consideration the full range of climate-related activities within the federal government. Similarly, we reported in September 2014 that 11 federal agencies were involved in the federal response to ocean acidification but that the roles and responsibilities for each agency have not been defined. As a result, we recommended that the appropriate entities within the Executive Office of the President clearly define the roles and responsibilities of each agency with regard to implementing an interagency ocean acidification research and monitoring plan. We did not receive a response to this recommendation.
The federal government has recently initiated many climate-related strategic planning activities. Specifically, the President's June 2013 Climate Action Plan and November 2013 Executive Order 13653 on Preparing the United States for the Impacts of Climate Change show how federal agencies have made some progress on better organizing across agencies, within agencies, and among different levels of government. In response to this executive order, agencies created climate change adaptation plans that outline steps they will take to, for example, factor resilience to the effects of climate change into grant-making and investment decisions, and into the design and construction of new and existing agency facilities and infrastructure. Agencies completed their first adaptation plans in 2012 and updated the plans in October 2014.
These and other federal efforts identify climate change as a priority and demonstrate commitment and top leadership support. While agencies have begun to take specific actions, most have yet to implement aspects of these plans or sustained momentum over time. It is also unclear how the various planning efforts relate to each other or what they amount to as a government-wide approach for reducing federal fiscal exposures. Further, existing strategic planning efforts generally do not address the roles, responsibilities, and working relationships among federal, state, and local entities; identify how such efforts will be funded and staffed over time; or establish mechanisms to track and monitor progress. Hence, the federal government cannot demonstrate progress in implementing corrective measures.
Federal Government as Property Owner
In its role as the owner of property, the federal government was rated as partially met for Leadership Commitment, Capacity, and Action Plan, and not met for Monitoring and Demonstrating Progress. The federal government owns and operates hundreds of thousands of facilities and manages millions of acres of land that could be affected by a changing climate. For example, the Department of Defense's (DOD) 2010 and 2014 Quadrennial Defense Reviews state that climate change poses risks to defense infrastructure, particularly on the coasts. DOD's infrastructure consists of more than 555,000 defense facilities and 28 million acres of land, with a replacement value of close to $850 billion. In May 2014, we found that DOD's implementation of guidance directing the consideration of climate change in installation planning is likely to vary across the department because installation planners lacked key definitions and other information about the impacts of climate change on specific facilities. In this report, we also found that DOD processes for approving and funding infrastructure projects did not explicitly account for climate change. In May 2014, we recommended, among other things, that DOD (1) develop a plan and milestones for completing climate change vulnerability assessments of installations; (2) provide further information to installation planners that clarifies how to account for climate change in planning; and (3) clarify the processes used to compare military construction projects for funding to include consideration of potential climate change impacts.  DOD concurred with our recommendations, noting that the department's goal is to integrate consideration of climate change into existing infrastructure planning processes and documents.
The federal government also owns and operates hundreds of thousands of nondefense buildings and facilities that a changing climate could affect. For example, NASA's real property holdings include more than 5,000 buildings and other structures such as wind tunnels, laboratories, launch pads, and test stands. In total, these NASA assets—many of which are located in vulnerable coastal areas—represent more than $32 billion in current replacement value. Federally funded and managed energy and water infrastructure is also vulnerable to climate change.For example, DOD's U.S. Army Corps of Engineers and the Department of the Interior's Bureau of Reclamation own and operate key water resource management infrastructure—such as canals, dams, and reservoir—that may be affected by changes in extreme precipitation events linked to climate change, among other impacts.
Professional associations, not federal agencies, generally develop the design standards—technical guidelines that promote the safety, reliability, productivity, and efficiency of infrastructure—that specify how weather and climate-related data are to be considered in project-level design and planning processes for infrastructure, including many federal facilities. These standards generally do not account for climate change, increasing potential federal fiscal exposures. In April 2013, we recommended, among other things, that the U.S. Department of Transportation and the Environmental Protection Agency work with relevant professional associations to incorporate climate change information into design standards that define how structures are to be built. These agencies did not provide official written comments to include in our report and have not directly addressed this recommendation. We have ongoing work related to climate change, design standards, and building codes.
The federal government also manages nearly 30 percent of the land in the United States—about 650 million acres of land, including 408 national park units and 155 national forests—for a wide variety of purposes, such as recreation, grazing, timber, and conservation. These resources are vulnerable to changes in the climate, including the possibility of more frequent and severe droughts and wildfires. Appropriations for federal wildland fire management activities have tripled since 1999, averaging more than $3 billion annually in recent years. In 2007, we recommended that that the Secretaries of Agriculture, Commerce, and the Interior develop guidance for resource managers that explains how they are expected to address the effects of climate change, identifies how managers are to obtain any site-specific information that may be necessary, and reflects best practices shared among the relevant agencies. In May 2013, we reported that these agencies had taken steps to establish strategic direction for addressing climate change and have developed guidance, training, and other tools for managers to use in adapting to climate change.However, as we noted in this report, federal land and resource managers still struggled to incorporate climate-related information into their day-to-day activities notwithstanding these actions. To further explore this issue, we have ongoing work related to the impacts of climate change on different types of resources such as coastal habitats and fisheries.
Demonstrating leadership commitment, Executive Orders 13514 and 13653 direct agencies to develop climate change adaptation plans to account for the impacts of climate change on agency operations and missions. Agencies completed their first adaptation plans in 2012 and updated the plans in October 2014, identifying vulnerable federal infrastructure and plans to account for climate change in infrastructure planning, demonstrating federal capacity to address the issue. However, this commitment needs to be sustained over time. Most agencies have yet to identify specific actions to implement adaptive measures. Also, there are no programs to monitor and independently validate the effectiveness and sustainability of the measures identified in the adaptation plans. Hence, the federal government cannot yet demonstrate progress in implementing corrective measures.
Also related to both federal facilities and the management of natural resources, on February 18, 2010, CEQ issued draft guidance on how federal agencies can consider the effects of climate change when Implementing the National Environmental Policy Act of 1969 (NEPA), which applies to certain types of federal projects. CEQ did not finalize the guidance or issue regulations addressing how, if at all, federal agencies are to consider the effects of climate change in the NEPA process but instead issued revised draft guidance in December 2014. CEQ has not indicated when or if the guidance would be finalized. Without finalized guidance from CEQ, it is unclear how, if at all, agencies are to consistently consider climate change when implementing NEPA. In April 2013 we recommended, among other things, that the CEQ Chairman finalize guidance on how federal agencies can consider the effects of climate change in their evaluations of proposed federal actions—such as infrastructure projects—under NEPA. CEQ has not directly addressed this recommendation.
Federal Insurance Programs
As the insurer of crops and property, the federal government was rated as partially met for Leadership Commitment and not met for Capacity, Action Plan, Monitoring, and Demonstrating Progress with respect to climate change. Two important federal insurance efforts—the National Flood Insurance Program and the Federal Crop Insurance Corporation—face climate change and other fundamental challenges that increase federal fiscal exposure and send inaccurate price signals to policyholders about their potential risk of loss. These programs are based on conditions, priorities, and approaches that were established decades ago and are not well suited to addressing emerging issues like climate change. The National Flood Insurance Program, administered by the Department of Homeland Security's (DHS) Federal Emergency Management Agency (FEMA), has been on our High Risk List since March 2006 because of concerns about its long-term financial solvency and related operational issues. For example, as of December 31, 2014, FEMA owed the Treasury $23 billion, up from $20 billion as of November 2012. FEMA made a $1 billion principal repayment at the end of December 2014—FEMA's first such payment since 2010. In August 2014, we reported on the federal crop insurance program's important role in managing the risk of farming losses caused by droughts, floods, and other natural disasters, and the associated federal costs.
Our March 2007 report assessing the financial risks to the National Flood Insurance Program and the United States Department of Agriculture's (USDA) Federal Crop Insurance Corporation found that their exposure to weather-related losses had grown substantially. Among other things, the report contrasted the experience of private and public insurers. We found that many major private insurers proactively incorporated some elements of climate change into their risk-management practices. In contrast, we noted that the agencies responsible for the nation's two key federal insurance programs had done little to develop the kind of information needed to understand their long-term exposure to climate change, and had not analyzed the potential impacts of an increase in the frequency or severity of weather-related events on their operations. We recommended that the Secretaries of Agriculture and DHS analyze the potential long-term fiscal implications of climate change for the Federal Crop Insurance Corporation and the National Flood Insurance Program, respectively, and report their findings to the Congress. As discussed below, since then, (1) Congress passed and subsequently amended the Biggert-Waters Flood Insurance Reform Act of 2012 (Biggert-Waters Act), and (2) in October 2014, we revisited these programs'exposure to climate-related losses.
- Biggert-Waters Act. In June 2011, we reported that external factors continue to complicate the administration of the National Flood Insurance Program and affect its financial stability. Specifically, as it relates to climate change and sea level rise, FEMA, historically, has not been authorized to account for long-term erosion when updating flood maps used to set premium rates for the National Flood Insurance Program. Flood maps are supposed to accurately estimate the likelihood of flooding in specific areas, given certain characteristics including elevation and topography, but they can quickly become inaccurate because of changes from long-term erosion, particularly in coastal areas. This could prove problematic in areas susceptible to sea level rise. Not accurately reflecting the actual risk of flooding increases the likelihood that even full-risk premiums will not cover future losses and adds to concerns about the National Flood Insurance Program's financial stability. Consequently, among a range of other recommendations, in June 2011, we presented a matter for congressional consideration to authorize the National Flood Insurance Program to account for long-term flood erosion in its flood maps.
Subsequently, Congress passed the Biggert-Waters Act, which requires FEMA to use information on topography, coastal erosion areas, changing lake levels, future changes in sea levels, and intensity of hurricanes in updating its flood maps, among other information. The Biggert-Waters Act created a technical mapping advisory council which must produce a "Future Conditions Risk Assessment and Modeling Report" with recommendations on how to ensure (1) rate maps incorporate best available climate science, and (2) that FEMA uses the best available methodology to consider the impact of rising sea levels and future development on flood risk. The act requires the council to submit the risk assessment and modeling report to FEMA. FEMA is then required to incorporate the report into its ongoing program to review and update rate maps. While these and other changes may help put the National Flood Insurance Program on a path to financial solvency, their ultimate effect is not yet known because the program faces challenges in making the changes.
- Our October 2014 Report on Public Insurers' Exposure to Climate-Related Losses. Demonstrating some commitment and top leadership support, public insurers have commissioned climate change studies, incorporated climate change adaptation into their planning, and taken other steps to better understand and prepare for climate change's potential effects. Regarding FEMA's flood insurance program, the agency is phasing out most subsidies and is studying how to incorporate the projected effects of climate change, such as future sea level rise and erosion, into its flood maps. However, the mapping advisory council's recommendations are not expected until September 2015. Until the agency implements these changes, policyholders and communities may continue to build and rebuild structures to current standards that do not necessarily reflect the changing weather-related risks faced over structures' which could exacerbate federal fiscal exposure amid already strained federal resources. To promote forward-looking construction and rebuilding efforts, we recommended in October 2014 that the Secretary of DHS direct FEMA to consider amending flood insurance standards to incorporate, as appropriate, forward-looking information. DHS agreed with our recommendation.
In addition, we reported in October 2014 that a variety of agricultural practices are available to farmers that would improve their long-term resilience to climate change, such as practices that would promote long-term water conservation and soil conservation. However, federal crop insurance policyholders may receive inaccurate price signals about their current risks because they receive premium subsidies and therefore do not bear the true cost of their risk of loss due to weather-related events—which could affect their farming decisions. Also, they may not receive signals that reflect the long-term implications of their short-term farming practice decisions. For example, certain practices, such as conventional tillage and traditional irrigation methods, may maintain historic crop yields in the short-term, but they may inadvertently reduce agriculture's long-term resilience through increased erosion, depleted soil quality, and inefficient water use. Consequently, we recommended in October 2014 that the Secretary of Agriculture direct the federal crop insurance program to consider working with agricultural experts to incorporate resilient agricultural practices into expert guidance for growers, so that good farming practices take into account long-term agricultural resilience to climate change. USDA did not specify its agreement or disagreement with our recommendation.
While progress is evident, the federal commitment needs to be sustained and enhanced over time. Agencies have yet to identify specific actions to address challenges inherent to federal insurance programs—such as how to encourage policyholders to reduce their long-term exposure to climate change given the short-term nature of insurance contracts—that may impede the ability of these programs to minimize long-term federal exposure to climate change. Further, there are no programs to monitor and independently validate the effectiveness and sustainability of the measures identified in agency plans. Hence, the federal government cannot yet demonstrate progress in implementing corrective measures.
Technical Assistance to Federal, State, Local, and Private-Sector Decision Makers
For its climate information technical assistance efforts, the federal government was rated as partially met for Leadership Commitment and Action Plan, and not met for Capacity, Monitoring, and Demonstrating Progress. Climate change has the potential to directly affect a wide range of federal services, operations, programs, assets, and national security, increasing federal fiscal exposure in many ways. State, local, and private-sector decision makers can also drive federal climate-related fiscal exposures because they are responsible for planning, constructing, and maintaining certain types of vulnerable infrastructure paid for with federal funds, insured by federal programs, or eligible for federal disaster assistance. Federal efforts are beginning to focus on providing information to these decision makers so they can make more informed choices about how to manage the risk posed by potential climate impacts. As we reported in October 2009, it is hard for decision makers at all levels to justify the current costs of resilience efforts for potentially less certain future benefits because the federal government's own climate-related data—composed of observational records from satellites and weather monitoring stations, projections from complex climate models, and other tools—is fragmented across many individual agencies that use the information in different ways to meet their respective missions. Federal, state, local, and private-sector decision makers may be unaware that this information exists or may be unable to use what is available.
- Federal Decision Makers. The federal government faces increased climate-related fiscal exposures as the owner of federal facilities, manager of natural resources, and insurer of property and crops. Agencies have developed focused efforts to provide climate-related information to federal decision makers so they can better manage the risk climate change poses to these and other programs. For example, bureaus and agencies within the Department of the Interior developed a network of collaborative Landscape Conservation Cooperatives, composed of public and private agencies working to provide the science and technical expertise needed to apply climate-related data in decision making. Further, the National Park Service, also within the Department of the Interior, is developing guidance for park-based climate change adaptation plans that includes such steps as identifying conservation targets and conducting vulnerability assessments. Despite the proliferation of such efforts within federal agencies, our work shows an enduring need for local-scale information. For example, our May 2014 report on defense infrastructure adaptation showed that officials at DOD installations were not sure which information to use in their planning.[40 ] We recommended that DOD provide further information to installation planners, clarifying actions that should be taken to account for climate change in planning documents. DOD concurred with this recommendation. Also, as we reported in September 2014, information related to ocean acidification that would be useful to federal, state, local, and private-sector decision makers was difficult to access because it was available on various federal websites and had not been consolidated. As a result, we recommended that the appropriate entities within the Executive Office of the President establish an information exchange to improve the national response to ocean acidification. We did not receive a response to this recommendation.
- State and Local Decision Makers. The federal government annually invests billions of dollars in infrastructure projects that state and local governments prioritize and supervise. For example, state and local governments control zoning decisions and make decisions about how to build certain types of critical infrastructure that are vulnerable to climate change, such as roads and bridges. The federal government has a key interest in helping state and local decision makers increase their resilience to climate change and extreme weather events because uninsured losses may increase the federal government's fiscal exposure through federal disaster assistance programs. As we reported in April 2013, the federal government plays a critical role in producing the information needed to facilitate more informed local adaptation decisions. However, this information exists in an uncoordinated confederation of networks and is not easily accessible, so state and local officials may make decisions without it or choose not to act at all. These decision makers often struggle to identify which information among the vast number of available datasets and studies is relevant. In April 2013, we recommended that a federal entity designated by the Executive Office of the President work with agencies to identify for local infrastructure decision makers the best available climate-related information for planning and to update this information over time. The Executive Office of the President did not provide official written comments to include in our report and has not directly addressed this recommendation. We continue to evaluate the technical assistance needs of state and local decision makers and have ongoing work related to how the nation's public health system—composed primarily of state and local officials—is responding to climate change>
- Private-Sector Decision Makers. Climate change also poses risks to private-sector decision makers by, for example, disrupting supply chains that provide the food, medicine, energy, and products that support the U.S. economic system. The federal government both relies on private-sector supply chains to provide these goods and services and provides assistance to the private sector in the aftermath of extreme weather events. This increases the federal government's fiscal exposure to a changing climate. We recently completed work on how climate change may affect the U.S. agriculture and energy sectors. As we reported in September 2014, the United States produced about $395 billion in agriculture commodities in 2012, with about half of this revenue from crop sales and half from livestock sales. According to USGCRP, increases in temperature, rainfall intensity, and extreme events, such as sustained droughts and heat waves, will likely have negative impacts on crop and livestock yields. USDA is taking several promising steps to help farmers mitigate and adapt to climate change. For example, it established regional Climate Hubs to deliver science-based knowledge, practical information, and program support to farmers, ranchers, and forest landowners to support decision making related to climate change. However, we found that USDA has made few efforts to quantify the costs and returns of taking certain actions that could help farmers make both short- and long-term decisions in the face of a changing climate. We recommended that its agencies develop and provide readily accessible information to farmers on the farm-level economic costs and returns of taking certain actions in response to climate change. USDA concurred with this recommendation.
Further, we reported in January 2014 that U.S. energy infrastructure is at risk for damage and disruptions to service due to severe weather events, according to assessments by NRC and USGCRP. While many climate change impacts are projected to be regional in nature, the interconnectedness of the nation's energy system means that regional vulnerabilities may have wide-ranging implications for energy production and use, ultimately affecting transportation, industrial, agricultural, and other critical sectors of the economy that require reliable energy. According to this January 2014 report, the federal government can play important supporting roles in providing information to promote climate resilience in the energy sector. We have ongoing climate-related work on private-sector adaptation, fisheries management, and federal supply-chain risk.
To address the climate information challenges faced by federal, state, local, and private sector decision makers, we recommended in October 2009 that the appropriate entities within the Executive Office of the President develop a government-wide strategic plan for adaptation. We stated that the plan should, among other things, identify mechanisms to increase the capacity of federal, state, and local agencies to incorporate information about current and potential climate change impacts into decision making. The November 2013 Executive Order 13653 on Preparing the United States for the Impacts of Climate Change calls on certain federal agencies to work together to provide authoritative, easily accessible, and usable climate-related information. This executive order and other efforts, such as the President's June 2013 Climate Action Plan, the U.S. Climate Resilience Toolkit, the USGCRP 2012-2021 strategic plan for climate change science, and the May 2014 Third National Climate Assessment, recognize the importance of providing and translating climate information for decision makers. These efforts also demonstrate commitment and top leadership support. However, this commitment needs to be sustained over time; the roles, responsibilities, and working relationships among federal, state, local, and private-sector entities are still unclear. Also, the resources and government-wide structure necessary to implement plans or sustain success are not yet defined. Based, in part, on this lack of capacity, no programs to monitor and independently validate the effectiveness and sustainability of corrective measures exist, and the ability to demonstrate progress is limited. We have ongoing work focused on government-wide options to provide technical assistance to decision makers.
In addition, existing satellite systems important to developing the information needed by state and local officials are nearing the end of their expected life spans. These systems have troubled legacies of cost increases, missed milestones, technical problems, and management challenges that have resulted in reduced functionality and slips to planned launch dates. As a result, the continuity of satellite data is at risk. According to program officials from the Department of Commerce's National Oceanic and Atmospheric Administration (NOAA), a satellite data gap would result in less accurate and timely weather forecasts and warnings of extreme events—such as hurricanes, storm surges and floods. Such degradation in forecasts and warnings would place lives, property, and our nation's critical infrastructures in danger. Given the criticality of satellite data to weather forecasts, the likelihood of significant gaps, and the potential impact of such gaps on the health and safety of the U.S. population and economy, we concluded that the potential gap in weather satellite data is a high-risk area and added it to the High Risk List in 2013. Since then, NOAA has demonstrated leadership commitment in mitigating satellite data gaps. However, work remains to complete plans and demonstrate progress in implementing them.
As the provider of disaster aid, the federal government was rated as partially met for Leadership Commitment and not met for Capacity, Action Plan, Monitoring, and Demonstrating Progress, with respect to climate change. Multiple factors, including increased disaster declarations, climate change effects, and changing development patterns increase federal fiscal exposure to severe weather events. Extreme weather events have cost the nation tens of billions of dollars in damages over the past decade. For example, in January 2013, about $60 billion in budget authority was provided to support recovery from Superstorm Sandy. Further, based on a 2013 analysis of disaster relief appropriations by the Congressional Research Service, the amount of inflation-adjusted disaster relief per fiscal year increased from a median of $6.2 billion for the years 2000 to 2006, to a median of $9.1 billion for the years 2007 to 2013 (46 percent). Such federal disaster aid functions as the insurance of last resort in certain circumstances because whatever is not covered by insurance or built to be resilient to extreme weather increases the federal government's implicit fiscal exposure through disaster relief programs. Fiscal constraints will make it more difficult for the federal government to respond effectively in the future and such expenses could affect resources available for other key government programs.
To prepare adequately for a disaster, federal agencies need to work with state and local governments and volunteer agencies to produce and evaluate information so that they can fully assess risk and make appropriate response and recovery decisions. However, FEMA has had difficulty implementing longstanding plans to assess national preparedness capabilities to prepare for and respond effectively to these disasters. Its efforts have been repeatedly delayed and are not yet complete. In addition, we reported in September 2012 that FEMA's indicator for determining whether to recommend that a jurisdiction receive disaster assistance is artificially low because it does not accurately reflect the ability of state and local governments to respond to disasters. As this report showed, had FEMA adjusted the indicator annually for inflation, 25 percent of the 508 disaster declarations from fiscal years 2004 through 2011 would not have met the eligibility criteria that FEMA used to determine whether federal disaster assistance should be provided, which would have likely resulted in fewer disaster declarations. Our 2012 report and others have identified challenges in the determination of costs to be borne by federal, state, and local governments or the private sector in preparing for, responding to, and recovering from disasters of all types. We have also reported that the availability of federal assistance may inhibit actions to mitigate disaster losses. As long ago as 1980, we reported that individuals may not act to protect themselves from the effects of severe weather if they believe the federal government will eventually help pay for their losses. In September 2012, we recommended, among other things, that FEMA develop a methodology to more accurately assess a jurisdiction's capability to respond to and recover from a disaster without federal assistance. FEMA concurred with this recommendation.
In the event of a major disaster, federal funding for response and recovery comes from the Disaster Relief fund managed by FEMA and disaster aid programs of other participating federal agencies. These programs have been provided emergency supplemental appropriations to cover the costs of damages. The federal government does not budget for the costs of these supplemental appropriations. Without proper budgeting and forecasting to account for these events, the federal government runs the risk of facing a large fiscal exposure at any time. Further increasing the challenge faced by the federal government in managing such fiscal exposures is that annual budget requests and appropriations for disaster relief do not include all known costs from still-open disaster declarations, in particular those from catastrophic disasters. This has led to requests for supplemental appropriations not only for new disasters, but also for costs related to ongoing, past disasters. As a result, decision makers may not have a comprehensive view of overall funding claims and trade-offs.
In this context, the federal response to Superstorm Sandy, other strategic planning documents, and executive orders demonstrate federal commitment and top leadership support for increasing resilience and reducing fiscal exposures posed by climate change. As we reported in October 2014, FEMA, in conjunction with other federal agencies, has taken some recent steps to manage future risks related to climate change for disaster relief. For example, in August 2013, the Sandy Rebuilding Task Force issued the Hurricane Sandy Rebuilding Strategy. This strategy contained 69 recommendations to various federal agencies and their nonfederal partners aimed at improving recovery from both Hurricane Sandy and future disasters. The Hurricane Sandy Rebuilding Task Force also implemented a minimum flood risk reduction standard for Sandy-related disaster funding to account for future sea level rise in response to Executive Order 13632. Under this standard, structures repaired or rebuilt must meet forward-looking standards, such as elevating the ground floor of a building 1 foot higher than existing FEMA standards. In addition, according to FEMA officials, a current interagency effort seeks to develop a Federal Flood Risk Reduction Standard that would apply to future disaster relief appropriations—although it is too early to know whether such a standard will incorporate future risk. Furthermore, according to a July 2014 White House statement, FEMA will issue new guidance that calls upon states to incorporate climate change into their hazard mitigation plans as a condition for receiving disaster relief. FEMA's Hazard Mitigation Assistance programs and post-disaster grants currently do not require grantees to incorporate sea level rise into their cost-benefit calculations for proposed projects, although they do allow it.
However, the extent to which federal agencies have implemented these and other recommendations to make disaster aid programs more resilient to climate change is unclear because there is no government-wide corrective action plan that defines clear roles and responsibilities, and no programs to monitor or independently validate the effectiveness and sustainability of the measures identified in the strategy and other plans. Hence, the federal government cannot yet demonstrate progress in implementing corrective measures. We have work under way evaluating these emerging federal efforts.
 More information on the June 2013 Climate Action Plan can be found here.
 GAO, Climate Change Adaptation: Strategic Federal Planning Could Help Government Officials Make More Informed Decisions, GAO-10-113 (Washington, D.C.: Oct. 7, 2009).
 GAO, Climate Change: Improvements Needed to Clarify National Priorities and Better Align Them with Federal Funding Decisions, GAO-11-317 (Washington, D.C.: May 20, 2011).
 GAO-10-113. CEQ coordinates federal environmental efforts and the development of environmental policies and initiatives. The Office of Science and Technology Policy was established by statute in 1976 to serve as a source of scientific and technological analysis and judgment for the President with respect to major policies, plans, and programs of the federal government, among other things.
 GAO, Ocean Acidification: Federal Response Under Way, but Actions Needed to Understand and Address Potential Impacts, GAO-14-736 (Washington, D.C.: Sept. 12, 2014). Scientists estimate that the oceans have absorbed approximately 30 percent of the carbon dioxide emitted by humans over the past 200 years. This increased uptake of atmospheric carbon dioxide is resulting in chemical changes in the oceans, including a decrease in the average pH of surface ocean waters and a reduction in the availability of minerals needed by many marine organisms to build shells and skeletons. Collectively referred to as ocean acidification, these chemical changes may pose risks for some marine species and ecosystems, as well as for the human communities that rely upon them for food and commerce.
 For more information on the interagency ocean acidification research and monitoring plan, click here.
 Click here for more information on the President's June 2013 Climate Action Plan, the November 2013 Executive Order 13653 on Preparing the United States for the Impacts of Climate Change, and other federal climate change resilience efforts.
 To access agency climate change adaptation plans, click here.
 GAO, Climate Change Adaptation: DOD Can Improve Infrastructure Planning and Processes to Better Account for Potential Impacts, GAO-14-446 (Washington, D.C.: May 30, 2014).
 GAO,Climate Change: Energy Infrastructure Risks and Adaptation Efforts, GAO‑14‑74 (Washington, D.C.: Jan. 31, 2014), and Climate Change: Federal Efforts Under Way to Assess Water Infrastructure Vulnerabilities and Address Adaptation Challenges, GAO‑14‑23 (Washington, D.C.: Nov. 14, 2013).
 DOD's Unified Facilities Criteria also establish design standards for military construction projects on DOD installations.
 GAO, Climate Change: Various Adaptation Efforts Are Under Way at Key Natural Resource Management Agencies, GAO-13-253 (Washington, D.C.: May 31, 2013).
Click here to access a summary of wildland fire management issues and related reports on our Key Issues website. See also Congressional Research Service, Wildfire Management: Federal Funding and Related Statistics, R43077 (Mar. 5, 2014).
 GAO, Climate Change: Agencies Should Develop Guidance for Addressing the Effects on Federal Land and Water Resources, GAO-07-863 (Washington, D.C.: Aug. 7, 2007).
 Pub. L. No. 91-190 (1970), codified as amended at 42 U.S.C.§§ 4321-4347 (2014). Under NEPA, federal agencies must assess the effects of major federal actionsmdash;such as those they propose to carry out or to permit—that significantly affect the environment. NEPA has two principal purposes: (1) to ensure that an agency carefully considers detailed information concerning significant environmental impacts, and (2) to ensure that this information will be made available to the public. For more information on CEQ's climate-related NEPA guidance, click here. The 2010 draft guidance was not applicable to federal land and resource management actions, but the 2014 draft guidance no longer maintains the distinction between land and resource management actions and other types of actions.
 The potential losses generated by the National Flood Insurance Program have created substantial financial exposure for the federal government and U.S. taxpayers. While Congress and FEMA intended that the National Flood Insurance Program be funded with premiums collected from policyholders and not with tax dollars, the program was, by design, not actuarially sound. For more information, see the National Flood Insurance Program section of this High-Risk report.
 Federal crop insurance program costs grew significantly during the period 2003 through 2012. For fiscal years 2003 through 2007, federal crop insurance costs averaged $3.4 billion a year, but for fiscal years 2008 through 2012, the crop insurance program cost an average of $8.4 billion a year. Program expansion and rising crop prices have led to increasing subsidy values and higher claims payments. For more details, see GAO, Crop Insurance: Considerations in Reducing Federal Premium Subsidies, GAO-14-700 (Washington, D.C.: Aug. 8, 2014).
 GAO, Climate Change: Financial Risks to Federal and Private Insurers in Coming Decades Are Potentially Significant, GAO-07-285 (Washington, D.C.: Mar. 16, 2007).
 Pub. L. No 112-141, div. F, tit. II, subtit. A 126 Stat. 405, 916 (2012).
 GAO,Climate Change: Better Management of Exposure to Potential Future Losses Is Needed for Federal Flood and Crop Insurance, GAO-15-28 (Washington, D.C.: Oct. 29, 2014).
 GAO, FEMA: Action Needed to Improve Administration of the National Flood Insurance Program, GAO-11-297 (Washington, D.C.: June 9, 2011).
 For more information about FEMA's challenges related to flood maps, see GAO, FEMA Flood Maps: Some Standards and Processes in Place to Promote Map Accuracy and Outreach, but Opportunities Exist to Address Implementation Challenges, GAO-11-17 (Washington, D.C.: Dec. 2, 2010).
 GAO-11-297 also contained two other related matters for congressional consideration: (1) allowing the National Flood Insurance Program to charge full-risk premium rates to all property owners and providing assistance to some categories of owners to pay those premiums; and (2) clarifying and expanding FEMA's ability to increase premiums or discontinue coverage for owners of certain repetitive loss properties.
 Pub. L. No 112-141, div. F, tit. II, subtit. A, §100216(b)(3), 126 Stat. 405, 927 (2012) (codified at 42 U.S.C. 4101b(b)(3)).
 Pub. L. No 112-141, tit. II, subtit. A,§ 100215(d) (2012).
 For more information, see the National Flood Insurance Program section of this High-Risk report.
 Click here for more information on Landscape Conservation Cooperatives.
 Budget Issues: Opportunities to Reduce Federal Fiscal Exposures Through Greater Resilience to Climate Change and Extreme Weather, GAO-14-504T (Washington, D.C.: July 29, 2014).
 GAO, Climate Change: USDA's Ongoing Efforts Can Be Enhanced with Better Metrics and More Relevant Information for Farmers, GAO-14-755 (Washington, D.C.: Sept. 16, 2014).
 Melillo, Jerry M., Terese (T.C.) Richmond, and Gary W. Yohe, Eds., Climate Change Impacts in the United States: The Third National Climate Assessment, USGCRP (Washington, D.C.: May 2014).
 Click herefor more information on USDA Climate Hubs.
 Click here for information on the June 2013 Climate Action Plan and here for information on USGCRP's strategic plan. For more information on the Third National Climate Assessment, click here. The climate resilience toolkit is accessible here and provides resources and a framework for understanding and addressing the climate issues that impact people and their communities.
 GAO, Disaster Resilience: Actions are Underway, but Federal Fiscal Exposure Highlights the Need for Continued Attention to Longstanding Challenges, GAO-14-603T (Washington, D.C.: May 14, 2014).
 The Disaster Relief Appropriations Act of 2013 (Pub. L. No. 113-2, div. A, 127 Stat. 4 (2013)) appropriated approximately $50 billion for expenses related to the consequences of Superstorm Sandy. The majority of appropriation accounts that received funding were subject to a reduction of 5 percent of their budgetary resources. In addition, another law increased the borrowing authority for the National Flood Insurance Program by $9.7 billion. Pub. L. No. 113-1, 127 Stat. 3 (2013).
 GAO, Emergency Preparedness: Opportunities Exist to Strengthen Interagency Assessments and Accountability for Closing Capability Gaps, GAO-15-20 (Washington, D.C.: Dec. 4, 2014). See also Managing Preparedness Grants and Assessing National Capabilities: Continuing Challenges Impede FEMA's Progress, GAO-12-526T (Washington, D.C.: Mar. 20, 2012) and Disaster Response: Criteria for Developing and Validating Effective Response Plans, GAO-10-969T (Washington, D.C.: Sept. 22, 2010).
 GAO, Federal Disaster Assistance: Improved Criteria Needed to Assess a Jurisdiction's Capability to Respond and Recover on Its Own, GAO-12-838 (Washington, D.C.: Sept. 12, 2012).
 Since September 11, 2001, the federal government has provided billions of dollars to state and local governments for planning, equipment, and training to enhance the capabilities of first responders to respond to both smaller-scale natural disasters and terrorist attacks. However, the federal financial assistance provided in the last several years has not been guided by a clear risk-based strategic plan that outlines the role of federal, state, and local governments in identifying, enhancing, maintaining, and financing critical first responder capabilities for emergencies. See GAO, 21st Century Challenges: Reexamining the Base of the Federal Government, GAO-05-325SP (Washington, D.C.: Feb. 1, 2005).
GAO, Federal Disaster Assistance: What Should The Policy Be?, PAD-80-39 (Washington, D.C.: June 16, 1980).
 GAO, Extreme Weather Events: Limiting Federal Fiscal Exposure and Increasing the Nation's Resilience, GAO-14-364T (Washington, D.C.: Feb. 12, 2014); Fiscal Exposures: Improving Cost Recognition in the Federal Budget, GAO-14-28 (Washington, D.C.: Oct. 29, 2013); and Budget Issues: Budgeting for Federal Insurance Programs, GAO/T-AIMD-98-147 (Washington, D.C.: Apr. 23, 1998).
[59 ]GAO, Disaster Cost Estimates: FEMA Can Improve Its Learning from Past Experience and Management of Disaster-Related Resources, GAO-08-301 (Washington, D.C.: Feb 22, 2008). See also, Supplemental Appropriations: Opportunities Exist to Increase Transparency and Provide Additional Controls, GAO-08-314 (Washington, D.C.: Jan. 31, 2008).
 This task force was established by Executive Order 13632: Establishing the Hurricane Sandy Rebuilding Task Force, Dec. 7, 2012.
 The Consolidated and Further Continuing Appropriations for Fiscal Year 2015 prohibits any appropriated funds from being used to implement a new Federal Flood Risk Management Standard until the Administration solicits and considers input from Governors, mayors, and other stakeholders. Pub. L. No. 113-235, div. E, tit. VII, § 750 (2014).
 According to a July 2014 White House statement, FEMA will release new guidance for state hazard mitigation plans that call upon states to consider climate variability as part of their requirement to address the probability of future events in state planning efforts, in an effort to rebuild stronger and safer after natural disasters and ensure that states prepare for the impacts of climate change. Office of the Press Secretary, Fact Sheet: Taking Action to Support State, Local, and Tribal Leaders as They Prepare Communities for the Impacts of Climate Change, (Washington, D.C.: July 16, 2014), accessed August 1, 2014, at http://www.whitehouse.gov/the-press-office/2014/07/16/fact-sheet-taking-action-support-state-local-and-tribal-leaders-they-pre.
65] FEMA's Hazard Mitigation Assistance programs include the Hazard Mitigation Grant Program, which assists in implementing long-term hazard mitigation measures following a major disaster; the Pre-Disaster Mitigation Program, which provides funds for hazard mitigation planning and projects on an annual basis, and the Flood Mitigation Assistance Program, which provides funds for projects to reduce risk of flood damage to buildings that are insured under the National Flood Insurance Program on an annual basis.
The federal government needs a strategic approach with strong leadership and the authority to manage climate change risks that encompasses the entire range of related federal activities and addresses all key elements of strategic planning. Such an approach includes the establishment of strategic priorities and the development of roles, responsibilities, and working relationships among federal, state, and local entities. Recognizing that each department and agency operates under its own authorities and responsibilities—and can therefore be expected to address climate change in different ways relevant to its own mission—existing federal efforts have encouraged a decentralized approach, with federal agencies incorporating climate-related information into their planning, operations, policies, and programs. While individual agency actions are necessary, a centralized national strategy driven by a government-wide plan is also needed to reduce the federal fiscal exposure to climate change, maximize investments, achieve efficiencies, and better position the government for success. Even then, such approaches will not be fully sufficient unless also coordinated with state, local, and private-sector decisions that drive much of the federal government's fiscal exposure. The challenge is to develop a cohesive approach at the federal level that also informs state, local, and private-sector action.
The federal government has many climate-related strategic planning activities under way. Specifically, the President's June 2013 Climate Action Plan and November 2013 Executive Order 13653 on Preparing the United States for the Impacts of Climate Change show how federal agencies have made some progress on better organizing across agencies, within agencies, and among different levels of government. This leadership needs to be sustained, with increased focus on implementing federal plans—identifying the roles, responsibilities, and working relationships among federal, state, and local entities; identifying how such efforts will be funded and staffed over time; and establishing mechanisms to track and monitor progress. In addition to addressing these broad strategic challenges, there are specific areas among many that may require attention including:
- Federal property and resources. This involves incorporating climate change information into infrastructure planning processes, working with relevant professional associations to incorporate climate change information into design standards that define how structures are to be built, and determining how to account for climate change in NEPA analyses.
- Federal flood and crop insurance programs. This entails developing the information needed to understand and manage federal insurance programs' long-term exposure to climate change and to analyze the potential impacts of an increase in the frequency or severity of weather-related events on their operations. Specifically, there is a need to incorporate the projected effects of climate change, such as sea level rise and erosion, into updated flood maps and agricultural practices incentivized by the federal government.
- Technical assistance to federal, state, local, and private-sector decision makers. This involves developing a government-wide approach for providing (1) the best available climate-related information for making federal, state, local, and private-sector decisions, and (2) assistance for translating available climate-related data into information that officials need to make decisions. We have ongoing work focused on government-wide options to provide technical assistance to decision makers.
- Environmental satellites. Potential gaps in satellite data need to be addressed. NOAA must improve its satellite mitigation plans, and implement and monitor key mitigation activities, to ensure that its plans to address potential gaps in satellite data are viable when needed. We plan to continue assessing NOAA's actions on its satellite programs to determine whether its plans are viable.
- Disaster aid. FEMA needs improved criteria to assess a jurisdiction's capability to respond and recover on its own, and also to better apply lessons from past experience when developing disaster cost estimates so decision makers have a comprehensive view of overall funding claims and trade-offs. We have ongoing work related to disaster assistance and budgeting for emergencies.
The State, Local, and Tribal Leaders Task Force on Climate Preparedness and Resilience established by Executive Order 13653 recommended many of the same actions in a November 2014 report to the President. Among other actions, the task force called on the federal government to incorporate resilient design standards in the building, retrofit, or repair of federal facilities; finalize guidelines for consideration of climate impacts in NEPA evaluations; provide data, tools, and guidance at a scale sufficient to guide state, local, and tribal decision making and investments; and modify disaster recovery programs to prioritize projects that are designed to withstand future climate impacts and that are located outside areas vulnerable under current or foreseeable conditions. Importantly, the task force recognized the need to designate a senior administration official to coordinate across federal agencies, and to establish implementation benchmarks and a process for reporting on progress. These are key elements of our criteria for removal from the high-risk list.
The Task Force on Climate Preparedness and Resilience was established by Executive Order 13653 and was composed of state, local, and tribal leaders. The task force was created to advise the President and an interagency council on how the federal government can support state, local, and tribal preparedness for and resilience to climate change, among other things. Click here for more information on the task force.
GAO-15-28: Published: Oct 29, 2014. Publicly Released: Nov 20, 2014.
GAO-14-755: Published: Sep 16, 2014. Publicly Released: Oct 16, 2014.
GAO-14-736: Published: Sep 12, 2014. Publicly Released: Oct 14, 2014.
GAO-14-504T: Published: Jul 29, 2014. Publicly Released: Jul 29, 2014.
GAO-14-446: Published: May 30, 2014. Publicly Released: Jun 30, 2014.
GAO-14-603T: Published: May 14, 2014. Publicly Released: May 14, 2014.
GAO-14-364T: Published: Feb 12, 2014. Publicly Released: Feb 12, 2014.
GAO-14-74: Published: Jan 31, 2014. Publicly Released: Mar 4, 2014.
GAO-14-23: Published: Nov 14, 2013. Publicly Released: Dec 13, 2013.
GAO-13-253: Published: May 31, 2013. Publicly Released: Jun 20, 2013.
GAO-13-242: Published: Apr 12, 2013. Publicly Released: May 14, 2013.