PRNewswire/ — The flooding in Houston earlier this week will be the costliest the city has seen in the 15 years since Tropical Storm Allison, say BBVA Compass economists, whose preliminary estimates of the economic impact are between $1.3 billion and $1.9 billion.
Several people died in the storms that landed overnight Sunday and left up to 18 inches of rainfall in some areas, flooding neighborhoods, swamping roads and stranding thousands of people. Economic activity came to a halt on Monday as schools, hospitals and businesses were shuttered and families sheltered in their homes. The economists’ estimate includes damage to roads, structures and cars, as well as the total value of lost economic activity and sales tax revenues.
“The economic impact of this week’s flooding is likely to surpass the Memorial Day flooding, which caused around $550 million in losses,” said BBVA Compass Senior Economist Boyd Nash-Stacey. “While it may pale in comparison to Tropical Storm Allison in 2001, which cost around $6.7 billion, it’s important to consider the cumulative impact of two damaging storms less than a year apart.”
BBVA Compass Chief Economist Nathaniel Karp warns that if these events become more frequent, the city will have to take bolder steps to avoid the loss of human life, contain the financial impact and remain an attractive and competitive metro area. “Houston doesn’t want to find itself in the news more for its flooding than its big personality and its economic promise,” he said.
Led by Karp, the bank’s research team analyzes the U.S. economy and Federal Reserve monetary policy. For its analyses, the economists create models and forecasts for growth, inflation, monetary policy and industries. The economic research team also follows a variety of issues that affect the Sunbelt states where BBVA Compass operates. Any statement or opinion of a BBVA Compass economist is that economist’s own statement or opinion and does not represent a statement or prediction by BBVA Compass, its parent companies or management.
