Resiliency Planning: What Shifts in Federal Disaster Funding Means for AEC Firms

Recent executive actions by the federal government have introduced significant changes to disaster preparedness and risk management infrastructure — a reshuffling that could have a cascading impact on AEC firms and their clients.

Federal funding has been cut or frozen for key Federal Emergency Management (FEMA) and National Oceanic and Atmospheric Administration (NOAA) programs, including:

• FEMA Hazard Mitigation Assistance programs such as the Hazard Mitigation Grants Program (HMGP), Flood Mitigation Assistance (FMA), and Building Resilient Infrastructure and Communities (BRIC). BRIC grants a total of $3.6B for states and local governments
• Funding for American Bar Associations Disaster Legal Services (DLS) program that has aided disaster survivors since 1970s
• Insurance affordability or financial sustainability of National Flood Insurance Program (NFIP)
• Retiring of NOAA Billion Dollar Weather and Climate Disasters database
• Reduction in NOAA climate data collection and forecasting of low and high-risk areas

Several of these programs have long played a critical role in shaping how insurers assess and price risk by providing data that underpins flood maps, informs building codes, and guides investment in resilient infrastructure.

Without the programs, insurance carriers will rely on more limited or costly proprietary data sources, adding both cost and complexity to the underwriting process. That burden is likely to trickle down to AEC project teams working in flood-prone or high-risk areas, where increased uncertainty can impact everything from site selection to design decisions and coverage availability and limits. As risk modeling changes and disaster resources become slower or harder to access, AEC firms need to proactively evaluate how they build, where they build, and how they protect themselves and their projects.

Best Practices: How AEC Firms Can Navigate a Changing Forecast

While the above changes may appear to affect insurers solely, the downstream effects — on design, construction, and contractual liability — are likely to reach project teams as well. AEC firms will face a new layer of complexity in both project delivery and operational planning. Here’s how firms can respond proactively:

1. Assess your flood risk early and often. FEMA maps may no longer reflect real-time risk, especially if NOAA funding cuts limit access to critical data. AEC firms should identify whether project sites are in flood zones using a mix of local data, historical weather patterns, and independent assessments. If the site is in a flood zone, confirm whether the community participates in the NFIP and whether flood insurance is available through a Write Your Own (WYO) private insurer. Availability and affordability may vary.
2. Translate flood risk into resilient design. If a site falls within or near a flood-prone zone, incorporate resilience into every layer of your design. Use flood-resistant materials, elevate mechanicals above base flood elevation, improve drainage, and waterproof substructures. Design choices must match the risk profile of the specific location, not just the minimum code requirements.
3. Build a site-specific emergency and equipment plan. When disaster strikes, preparation must extend beyond evacuation. AEC firms should develop tailored emergency response plans for each job site or company location, accounting for how to secure and remove equipment, materials, or hazardous substances. If you have large swing equipment, chemical storage, or lab facilities onsite, consider how they will be anchored or evacuated in a storm to prevent environmental or structural damage.
4. Track policy shifts that affect project feasibility and cost. Cuts to FEMA programs like BRIC and DLS, along with halted FFRMS compliance, may reduce resilience funding, slow recovery, and increase costs for clients, especially in underserved regions. AEC firms should stay current on federal, state, and local changes that could impact permitting, disaster aid eligibility, and community insurance availability to support their clients and help them navigate this uncertainty.
5. Revisit contract language for gaps in risk and responsibility. As more disaster costs shift to state and local governments, AEC firms may be exposed to new liabilities and should pay close attention to contract terms around delays, equipment loss, and disaster response. Acts of God will not be covered, and firms could face claims for breach of duty if projects are deemed under-designed for known flood or storm risk. All contracts moving forward should reflect current climate realities, not just historical expectations.
6. Evaluate your insurance strategy, including alternatives. With the NFIP under financial strain and private carriers rethinking high-risk coverage, firms should explore other options. Parametric insurance—which is triggered by defined events like rainfall totals and wind speeds—can offer predictable payouts. Captive insurance and other alternative risk financing approaches may be a fit for firms with significant exposure or multiple locations.

In an environment of evolving risks and shifting directives, AEC firms that anticipate change and work with their broker to determine the best risk transfer solutions will be best positioned to protect their work, support their clients, and build with resilience in mind.