Western Canada: Globe analysis shows B.C. floods likely the most-costly disaster in Canadian history

Good morning. Wendy Cox in Vancouver.

It’s budget day in British Columbia on Tuesday and this year’s road map must have been a particular challenge to develop. With the pandemic grinding along in ways most people didn’t want to contemplate a year ago, the provincial government was always going to be faced with difficult spending choices. Add in the devastation of November’s catastrophic flooding and the costs to provincial coffers heading long into the future will be substantial.

Just how substantial has not yet been determined. So legislature reporter Justine Hunter wanted to get an idea. It involved weeks of work because the provincial government has been reluctant to make any sort of estimate on the costs of flood damage beyond saying it would be “a lot.”

The Globe and Mail’s analysis indicates it is indeed a lot, likely the most-costly disaster in Canadian history with damages, Justine calculates, equalling roughly $9-billion and possibly much higher if all that was damaged is to be repaired.

One strong clue is in Ottawa’s $5-billion commitment to help pay for the recovery. That figure, described by the province as historic, is based on Ottawa’s internal estimate of its share of the recovery expenses, under its Disaster Financial Assistance Arrangements (DFAA) program. Ottawa’s share in similar circumstances has been less than half of the total price tag.

James Davies, an economist at Western University who specializes in disaster financial-assistance programs, said the Calgary floods in 2013 offer the best guide to the cost-sharing that will likely apply.

Public Safety Canada’s Canadian Disaster Database shows that for the 2013 floods, the total listed costs were 2.67 times the size of the federal cost-sharing payments. If the same ratio applies for the November, 2021, flooding in B.C., that would put total listed costs at about $13-billion.

The database, which tallies only costs paid out by governments and insurers, has not been updated to include the November storms. It shows Canada’s most expensive disaster as the ice storm across Ontario, Quebec and New Brunswick in 1998, with $6.5-billion in damages.

For The Globe’s analysis, we learned that private insurers expect to pay out $515-million in claims, and that the province will likely pay out a similar amount to those property owners who have no overland flood insurance. The provincial government must also rebuild critical highway links in treacherous terrain. Based on the province’s most recent major highway project, that could top $6-billion. Municipal governments in the worst-hit communities have estimated that they have sustained more than $1-billion in damaged infrastructure.

Beyond those big-ticket items, there are myriad other costs, including emergency relief, dike repairs and Canada’s largest agriculture flood aid package ever.

All of that money is simply a window into what it will cost to repair what was lost. It doesn’t include further millions of dollars in forgone revenue as a result of shipping delays at the Port of Vancouver and the shutdown of the Trans Mountain pipeline.

The disaster offers a lesson to Canada about the need to invest in preventive measures in a country that is increasingly at risk of extreme weather catastrophes because of climate change. The outlays will challenge the existing cost-sharing arrangements between different levels of government for disasters of this magnitude. They also underscore how Canada’s mechanisms for financing disaster relief reward inertia.

Shortly after B.C.’s devastating storms, an expert panel commissioned by Public Safety Canada issued a warning that the country is underinvesting in risk reduction, resulting in higher costs for response and recovery after disasters strike.

“Outcomes like this are not inevitable – they are the result of choices that put people in harm’s way. There are practical measures that can be implemented to help mitigate the most damaging effects of extreme weather events,” Scott Vaughan, chair of the expert panel from the Council of Canadian Academies, wrote in the introduction to the January report, Building a Resilient Canada.

But that hasn’t happened, in part because Canada’s system for sharing the financial costs of a disaster removes the incentive to invest beforehand in measures to reduce risk, according to the panel of experts.

Keith Porter, chief engineer of the Ontario-based Institute for Catastrophic Loss Reduction, says studies of natural hazard mitigation show that building roads and highways up higher in flood-prone areas can save up to $11 per $1 added to costs. The Institute calculates that Canada could spend $500-billion to fix houses at risk because of floods, strong winds, earthquakes or wildfires, and that would save $2-trillion down the road.

“If you think preparing for disaster is costly, what the floods in B.C. have shown us is that not preparing costs a whole lot more.”

The company building a natural-gas pipeline in northern British Columbia released harrowing details Friday of an attack on one of its workcamps in territory claimed by the Wet’suwet’en.

Nine CGL workers were forced to flee in the middle of the night this week after 20 masked assailants, some carrying axes, overwhelmed security at the site. The attack prompted condemnation from federal and provincial politicians.

The assailants cut the lights and power on the site, some 60 kilometres from Houston, then commandeered heavy equipment, which they used to cause “significant damage to other heavy equipment and trailers,” CGL said. The video surveillance system on site was also disabled, but workers were able to take photos and videos and those have been turned over to the RCMP.

A series of barricades – a yellow school bus, tire spikes, felled trees and fires – were used to slow the police response to the remote work site near the Morice River drill pad site off the Marten Forest Service Road. The RCMP said that officers were attacked by smoke bombs and fire-lit sticks while attempting to respond, and that one officer was injured.

There is no word on arrests. A spokesman for the hereditary chiefs who have been protesting against the project for years said not enough details are known about what happened.

“All we know is no arrests or charges,” John Ridsdale, whose Wet’suwet’en Nation hereditary chief’s name is Na’Moks, said in a text message to The Globe.

“Harassment of our camps continues. Nothing more than that until we get more information,” said Mr. Ridsdale.

This is the weekly Western Canada newsletter written by B.C. Editor Wendy Cox and Alberta Bureau Chief James Keller. If you’re reading this on the web, or it was forwarded to you from someone else, you can sign up for it and all Globe newsletters here.