Municipal financing costs following disasters

Bourdeau-Brien, Michaël; Kryzanowski, Lawrence

doi:10.1016/j.gfj.2018.10.004

Cited by 9 publications

(3 citation statements)

References 48 publications

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“…The Storm Data preparation document indicates that the NWS puts an effort to use the best available information, but because of time and resource constraints, information from sources outside the NWS may be unverified by the NWS, indicating that the NWS does not guarantee the accuracy or validity of the information (NWS, 2022b ). However, the data gathered in the SED have significant impacts on policy, mitigation, and resource allocation and are widely used by scientific researchers in fields outside meteorology (e.g., Cutler, 2015 ; Jones, 2022 ) as well as in forensic investigations (Grimshaw & Ploger, 2018 ), public health assessments (Lothrop et al., 2022 ; Rublee et al., 2020 ), economic analyses (Griffin et al., 2021 ), finance (Bourdeau‐Brien & Kryzanowski, 2019 ) emergency planning (Hays County Texas, 2017 ) and legal and political matters (Sisco, 2021 ). Therefore, the accuracy and precision of the database should be of great importance.…”

Section: Resultsmentioning

confidence: 99%

When a Dust Storm Is Not a Dust Storm: Reliability of Dust Records From the Storm Events Database and Implications for Geohealth Applications

2023

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Windblown dust impacts human health, air quality, and climate. The National Weather Service Storm Events Database (SED) is a widely used dataset of significant or unusual weather, including dust storms (DS), and resulting deaths, injuries, and material losses in the USA. The SED is frequently used by medical, social, and atmospheric scientists. However, it is uncertain whether this dataset reliably represents spatial and temporal variations and trends of DS. Analyzing the SED from 2000 to 2020 identified 1,167 DS reports; removing reports of the same event from multiple locations left 647 DS in 21 USA states. The number of DS ranged from 12 in 2008 to 53 in 2018, with no strong interannual trends detected ( R 2 was 0.3). By examining the DS events reported in the SED based on meteorological observations including wind speed, visibility, and weather codes, we determined that the SED was not only missing many DS (visibility <1 km), but also included many blowing dust (BLDU) events. 49.9% of 491 reported DS events in SED had visibility >1 km and were incorrectly reported as DS. Underrepresentation of DS and inclusion of BLDU may be partially due to the diverse sources contributing to the SED and a lack of verification of the reports and their consistency. Although the SED is an extremely useful and valuable database of impactful weather, including DS, the issues found in this study warrant caution in use of this dataset for many geohealth applications.

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Section: Resultsmentioning

confidence: 99%

When a Dust Storm Is Not a Dust Storm: Reliability of Dust Records From the Storm Events Database and Implications for Geohealth Applications

2023

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“…The basic/hedonic model includes (drawing on methods in Bourdeau-Brien and Kryzanowski 2019) [ 19 ]:…”

Section: Methodsmentioning

confidence: 99%

“…Market spread values on 4/27/2022 were determined via evaluations, assuming bidside and 1 million USD and larger block sizes. The municipal market is relatively illiquid, and only ~1% of the market trades on any given day [18]. As such, many of the evaluations in the market spread dataset are estimates, determined through comparable bond sales (much like residential real estate value estimates).…”

Section: Plos Onementioning

confidence: 99%

Climate, race, and the cost of capital in the municipal bond market

Smull,

Kodra,

Stern

et al. 2023

PLoS ONE

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Both climate risk and race are factors that may affect municipal bond yields, yet each has received relatively limited empirical research attention. We analyzed > 712,000 municipal bonds representing nearly 2 trillion USD in par outstanding, focusing on credit spread or the difference between a debt issuer’s interest cost to borrow and a benchmark “risk-free” municipal rate. The relationship between credit spread and physical climate risk is significant and slightly positive, yet the coefficient indicates no meaningful spread penalty for increased physical climate risk. We also find that racial composition (the percent of a community that is Black) explains a statistically significant and meaningful portion of municipal credit spreads, even after controlling for a variety of variables in domains such as geographic location of issuer, bond structure (e.g., bond maturity), credit rating, and non-race economic variables (e.g., per capita income). Assuming 4 trillion USD in annual outstanding par across the entire municipal market, and weighting each issuer by its percent Black, an estimated 19 basis point (bp) penalty for Black Americans sums to approximately 900 million USD annually in aggregate. Our combined findings indicate a systemic mispricing of risk in the municipal bond market, where race impacts the cost of capital, and climate does not.

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