[CEUS-earthquake-hazards] The balance

Mon Jan 14 14:19:23 GMT 2008

Dear Laurence,

You have brought up several good issues. Here are my takes on some of the issues:

1. "One issue is what present science says about the known hazards from earthquakes in the central US. As everyone who follows this topic knows, we are learning more all the time, but there is still much to be learned about this."

The New Madrid seismic zone is the biggest concern in the CUS. Here are the basic facts we known: 1) At least three large earthquakes in the range of M7 to 8 occurred in 1811-1812; 2) The paleo-seismic studies suggest that the large earthquakes reoccurred about every 500 to 1,000 years in the past couple thousands of years and the locations of these large earthquakes are consistent with current seismicity; 3) the estimated peak ground acceleration (PGA) is about 0.2-0.3g (median) in Memphis, TN, and 0.25-0.35g (median) in Paducah, Ky. These PGAs are equivalent to MMI VIII (Bolt, 2003). The seismic hazard that is of safety concern can be measured as:1) M7-8 earthquake with a recurrence tine of 500-1,000 years in the New Madrid region; 2) 0.2-0.3g PGA in Memphis and 0.25-0.35g PGA in Paducah with a recurrence time of 500-1,000 years; or 3) an MMI VIII in Memphis and Paducah with a recurrence time of 500-1,000 years.

It should be noted that the recurrence time or occurrence frequency of the earthquake or ground motion (a consequence of earthquake) at a site is a very important parameter, particularly for risk analysis. However, the recurrence time or occurrence frequency has been either ignored or not used correctly. Therefore seismic hazard is determined by two parameters: a level of hazard (a certain magnitude or the phenomena generated by the earthquake, such as surface rupture, ground motion<http://www.uky.edu/KGS/geologichazards/risks.htm#gm#gm>, ground-motion amplification<http://www.uky.edu/KGS/geologichazards/risks.htm#gma#gma>, liquefaction<http://www.uky.edu/KGS/geologichazards/risks.htm#liq#liq>, and induced-landslides<http://www.uky.edu/KGS/geologichazards/risks.htm#landslide#landslide>) and its recurrence frequency (or interval).

2. "Still another topic is what the present seismic risks to various elements of the local economy, local infrastructure and national economy are assessed to be in the central US."

The definition of seismic risk is broad and subjective. The purpose of assessing seismic risk is to make policies for risk reduction in comparison with all other risks.  In a general term, risk is the probability (chance) of harm if someone or something (vulnerability) is exposed to a hazard. In a quantitative term, risk is defined by three parameters: probability, a level of hazard, and exposure (time and asset). For example, in health sciences, risk is defined as the likelihood (probability) of getting cancer if an average daily dose of a hazardous substance (hazard level) is taken over a 70-year lifetime.  In the financial world, risk can be the probability of losing a certain amount of money over a period. The figure below shows the 23 core global risks estimated by the World Economic Forum (2007) over a 10-year exposure time. This figure also shows how risk information is used for policy decision making.

  [cid:image001.gif at 01C85690.4B506B20]

The 23 core global risks over a 10-year time frame estimated by World Economic Forum (2007).
Therefore, in a quantitative term, seismic risk is defined as the probability of experiencing a level of seismic hazard or loss for a given exposure (time and asset). Seismic risk can be measured as a 5-10% probability of exceedance of a M7-8 earthquake in 50 years, a 5-10% probability of exceedance of 0.2-0.3g (median) in 50 years in Memphis, TN, and 0.25-0.35g (median) in Paducah, Ky, or a 5-10% probability of exceedance of MMI VIII in 50 years. These risk calculations are based on 1) time-independent [Poisson] model that could be used to describe the occurrences of earthquakes; 2) an exposure (building) with a life of 50 years.

Seismic hazard and risk are two fundamentally different concepts. The relationship between seismic hazard and risk is complicated and must be treated very cautiously. More importantly, the mitigation policies are made based on seismic risk, not seismic hazard.

3. "Another issue is what public policy, if any, should be promulgated by the United States government given the present state of knowledge."

Example 1: Seismic hazard and risk comparison between the New Madrid and San Francisco Bay areas. As shown in the following figure, the New Madrid area experienced a similar MMI (MMI VIII) in comparison with that for the SF Bay area. This figure seems to suggest the central US has a bigger problem. However, this is not necessary true because another important parameter, the occurrence frequency, is missing. In the bay area, the large earthquake occurs about every 100 years (i.e., the 1906 SF and 1989 LP) and about 500-1,000 years in the New Madrid area. In terms of hazard comparison, we have an M7.8/100-year recurrence vs. M7.7/500-1,000-year recurrence, or MMI VIII/100-year recurrence vs. MMI VIII/500-1,000-year recurrence. The hazard comparison may not be straight forward.

Let's consider risk comparison by putting two identical buildings with 50-year life in San Francisco and Paducah, respectively. The risk for the building in SF is about 39% PE of an M7.8 earthquake or MMI VIII in 50 years, about 5-10% PE of an M7.7 earthquake or MMI VIII in 50 years in Paducah. This risk comparison makes it clear that a building will have a much higher probability (4 to 8 times) of experiencing a similar earthquake or MMI in SF than in Paducah. This risk comparison implies that:
1)       It makes sense that the most mitigation efforts (resources) go to CA, by taking into consideration the fact that there are much more exposures in SF bay area (good policy).
2)      It dose not make sense that the design ground motion for a building in the New Madrid area is similar or even greater than that in the bay area.

[cid:image002.gif at 01C85690.4B506B20]

Example 2: hazard and risk comparisons between earthquake, flood, and tornado in the central US. As shown in the following figure, there are other natural hazards that occur much more frequently in the central US. These comparisons suggest that seismic risk may not be the highest in the central US. In other words, it may not be a good policy to spend more resources on seismic hazard mitigation than other hazard mitigations.

[cid:image005.gif at 01C85690.4B506B20]

4. "I would also say that while it is difficult for engineers to justify structural requirements in excess of those required by code to a building owner, it can be done, witness the design requirements for the new Red Cross blood center in the St Louis area, which significantly exceed those required by local code. That cost-benefit analysis showed clearly that the Red Cross would benefit by such a decision, which was why we elected that course of action independent of the local code requirements."

It may not be wise to have higher seismic design requirements for the new Red Cross blood center in the St Louis area (considering seismic risk only). Other risks should also be considered.

Thanks.

Zhenming

________________________________
From: WrightLa at usa.redcross.org [mailto:WrightLa at usa.redcross.org]
Sent: Friday, January 11, 2008 1:24 PM
To: Wang, Zhenming; rogersda at mst.edu; JT at ReavesFirm.com; ceus-earthquake-hazards at geohazards.cr.usgs.gov
Cc: seth at earth.northwestern.edu
Subject: RE: [CEUS-earthquake-hazards] The balance

To All:

speaking purely for myself and NOT the Red Cross, I see several different issues being discussed here.
As a Red Cross NHQ employee, and as a structural engineer, I am interested in all of these issues.

One issue is what present science says about the known hazards from earthquakes in the central US. As everyone who follows this topic knows, we are learning more all the time, but there is still much to be learned about this.

Another issue is what public policy, if any,  should be promulgated by the United States government given the present state of knowledge.

Still another topic is what the present seismic risks to various elements of the local economy, local infrastructure and national economy are assessed to be in the central US.

Yet another issue is what, if anything, States and local government entities should be doing WRT regulation of the building design process, and what level of Federal compulsion is appropriate, if any.

Engineering cost-benefit analysis is a tool that can be applied to assist in the evaluation of all of these issues, but it is NOT the only tool, nor is it perfect.

I would like, with the utmost respect to all, to suggest that I, as an end user of the information being discussed, would benefit from having each of the above topics discussed objectively, separately and dispassionately.  I think it is fair to say that there is legitimate grounds for debate on significant portions of all of the above issues, and the fact that there is disagreement on these issues is not necessarily any  reflection on the ability or good will of any of the debaters.  I'd like to see the discussion continue on each of the issues above.

I would also say that while it is difficult for engineers to justify structural requirements in excess of those required by code to a building owner, it can be done, witness the design requirements for the new Red Cross blood center in the St Louis area, which significantly exceed those required by local code. That cost-benefit analysis showed clearly that the Red Cross would benefit by such a decision, which was why we elected that course of action independent of the local code requirements.

Laurence M. Wright

Senior Project Engineer

Red Cross Manufacturing Engineering

202-303-4457 (o)

202-549-5843 (c)

-----Original Message-----
From: ceus-earthquake-hazards-bounces at geohazards.cr.usgs.gov [mailto:ceus-earthquake-hazards-bounces at geohazards.cr.usgs.gov] On Behalf Of Wang, Zhenming
Sent: Friday, January 11, 2008 8:09 AM
To: Rogers, David; Joe Tomasello; ceus-earthquake-hazards at geohazards.cr.usgs.gov
Cc: Seth Stein
Subject: Re: [CEUS-earthquake-hazards] The balance

I agree with David that any mitigation policy should be debated openly. But so far, many of the policies made for seismic hazard mitigation are not based on scientific facts and open discussions. The society makes mitigation policies based on risk, not hazard information.  It would be helpful for making sound seismic hazard mitigation policies if geo-scientists and engineers can define and discuss the true seismic hazard and risk in the central US.

Zhenming

________________________________
From: ceus-earthquake-hazards-bounces at geohazards.cr.usgs.gov [mailto:ceus-earthquake-hazards-bounces at geohazards.cr.usgs.gov] On Behalf Of Rogers, David
Sent: Wednesday, January 09, 2008 6:01 PM
To: Joe Tomasello; ceus-earthquake-hazards at geohazards.cr.usgs.gov
Cc: Seth Stein
Subject: Re: [CEUS-earthquake-hazards] The balance

Joe

This isn't a new issue; the CA Seismic Safety Commission has had to deal with these kinds of issues for years.  The figure I'd be suspicious of is the $110 billion being suggested by the California Healthcare Association, which is a trade organization that lobbies for favorable legislation on behalf of hospital owners and operators - many of which are wealthy corporations.  They consistently oppose legislation that mandates increased government regulations or costs. They are the same organization that fought against hospitals being required to have their own onsite power generation back in the early 1960s, asserting that it would be cost-prohibitive and never be utilized sufficiently to justify the costs, etc. etc.   And they had numbers that "proved" their case, because CA hadn't experienced a sizable earthquake near a metropolitan area between 1906-71 (the utilization calculation would be very different today, esp. with the summertime power brownouts).  These sorts of organizations and lobbyists always throw out huge dollar values to justify their cases - e.g. if you put that regulation on us, it will put us out of business and it will costs billions and billions of dollars, etc. etc.   There will be a cost, but what that actual cost will end up being is usually inflated significantly by trade organizations when they are opposing proposed legislation.  That's just the way the lobbying game is played.

We've dealt with a similar, but smaller issues here in Missouri, whenever legislation is proposed (almost every year) to require skilled care and convalescent facilities to furnish onsite remote power generation  -- they spend huge amounts of money to repress such legislation, asserting that it will "bankrupt" them and that their facilities are "barely scrapping by" because their patient fees are controlled by Medicare, etc., etc., etc.  That's what the SAY anyway ..... but, when you see the slick lawyers doing their lobbying, you sort of get the felling that SOMEBODY is making enough money in the skilled care facility business to hire high-powered lobbyists....

So, there's always two sides to every tale.  I would agree that, as engineers or planners, we should always be examining the cost-benefit ratios.  But, we should also realize that the actual dollar losses incurred by a natural or man-caused disaster are far beyond the figures predicted in FEMA models like HAZUS. Just look at the economic impact of the 9/11 attacks; the two World Trade Center towers are only a tiny fraction of the actual economic loss caused by their collapse.

So, these issues should be debated out in the open, realizing that most people come to the table with specific agendas.....In raising that issue, your concern is valid.

Dave Rogers
Missouri Seismic Safety Commission

J. David Rogers, Ph.D., P.E., R.G., C.E.G., C.H.G.
Karl F. Hasselmann Chair in Geological Engineering
Department of Geological Engineering
129 McNutt Hall, 1400 N. Bishop Avenue
Missouri University of Science & Technology
Rolla, MO 65409-0230
(573) 341-6198 voice
(573) 341-6935 fax
E-mail: rogersda at mst.edu
URL: www.mst.edu/~rogersda

Formerly the University of Missouri-Rolla

________________________________
From: ceus-earthquake-hazards-bounces at geohazards.cr.usgs.gov [mailto:ceus-earthquake-hazards-bounces at geohazards.cr.usgs.gov] On Behalf Of Joe Tomasello
Sent: Wednesday, January 09, 2008 1:51 PM
To: ceus-earthquake-hazards at geohazards.cr.usgs.gov
Cc: 'Seth Stein'
Subject: [CEUS-earthquake-hazards] The balance

Buddy:

I'd like to offer the following for your e-mail discussion group:

Natural disasters such as earthquakes create complex situations for policy makers. The difficulty lies in the balance between the costs of mitigation and the actual risk. Failing this, policy makers could find themselves dealing with unintended consequences such as those experienced by the hospital industry in California.  If it's worth the expense in any one region it would be California; but looking at the hospital industry in California we don't see it.

Earthquake risks in California are, to some degree, statistically predictable; being a near certainty that a moderate to strong earthquake will occur somewhere on the west coast during a single generation of the built environment. California attempted to balance public safety with mandated seismic mitigation in a knee jerk reaction to the 1994 Northridge earthquake California's Legislature passed Senate Bill 1953 (SB 1953). The bill was an unfunded mandate to retrofit, rebuild, or close; a free lunch for California taxpayer. However, over the past decade the consequences of the mandate caused a once sound hospital system transform into one of the nation's foremost financial basket cases.

As in California, policy makers in the New Madrid Seismic Zone are led to believe that earthquake mitigation costs are small, having little effect on the built environment. California's mitigation program entails retrofitting all acute care hospitals or re-building nearly 70 million square feet. The pace of construction is limited to approximately 1.5 million to 2 million square feet per year due in large part to the ability of regulatory agencies to keep up. Furthermore it takes upward of 10 years to design and build a new hospital.  "The lengthy process for review and approval of hospital construction and retrofitting projects is far too long. Economic growth is being thwarted; jobs are being lost; and patient safety is being compromised."[i]  The result is that it will take nearly 30 years to complete all the construction required by SB 1953. [ii] The extended deadline is 2013.

The size and scope of most of these projects are very large and expensive.  Compliance could cost California hospitals as much as $110 billion dollars.  The original estimate assumed that the number of patients and the number of beds would generally remain the same.  However, modern design standards are most effective with facilities 35% to 60% larger[iii]. Thus, the scope of each construction project will increase as will the overall cost; perhaps as much as 20%.  [iv] In California construction costs are rising at an annual rate of more than 14 percent above the Consumer Price Index resulting in construction costs more than 40 percent higher for comparable facilities in other states.[v] In my view this increase is likely to continue do to regulatory oversight, the limited number of qualified contractors, as well as the annual inflation of material costs. In California, a fully furnished and equipped acute care facility (labor and materials) costs $1,000 per square foot.  Since the SB 1953 mandates affect for-profit, non-profit and publicly owned organizations most all projects will be financed.  Depending on the terms of the loan the cost in current dollars for an acute care facility the square foot cost can exceed $2,800; comparatively normal office construction in Tennessee is roughly a third the cost per square foot.

Looking at FEMA's annualized earthquake losses[vi] we find the relationship of Cost vs. Benefit even more lopsided. FEMA reports that California will experience a loss of approximately $3,167.5/$Million of infrastructure each year as a result of earthquakes. Looking at the same 50 year period, California can expect to lose approximately 15.8% of the present value of hospitals. Thus, California's acute care infrastructure, worth approximately $48 Billion [my estimate - C. Duane Dauner, President and Chief Executive Officer, California Healthcare Association, Statement "Heath Care Scene in California," May 10, 2001, suggested 24 Billion.], should expect a loss of approximately $7.6 Billion due to earthquake. We find that California is spending $110 Billion to offset a loss of $7.6 Billion; a cost benefit relationship greater than 14.  Over the past 10 years, we've asked FEMA for a Cost vs. Benefit analysis for the New Madrid Seismic Zone.  So far we haven't seen anything that would come close to suggesting that the public would benefit spending limited resources.

There are a more subtle negative consequences resulting from forcing acute care facilities to close because they don't meet mandated requirements.  California is experiencing a critical closure of hospitals with the closure of over 50 hospitals in the 10 year period between 1995 and 2005. More than 3,000 acute care beds have been removed from service between 2001 and 2005. In the five year period prior (1995 to 1999) 23 hospitals closed. Unfunded mandated seismic requirements are creating a stampede for funding, usually in the form of bonds.  The median credit ratio of California hospitals had nosed dived to the junk-bond status.  The money needed to retro fit California hospitals is drying up. [vii] "Nobody can bear the burden [of SB 1953 unfunded mandate]"[viii]  Here in the New Madrid Seismic Zone we're told that the cost is minimal.

"Seismic upgrades are important. But mandating them during the worst economic time in the history of California hospitals is like ordering a homeowner to fix a dilapidated porch on a house that's on fire. Right idea. Wrong time."[ix] How many doctors and nurses could have been hired in lieu of spending the money on hospital infrastructure? Just how many lives will be saved? How many lives will be lost because of the loss of acute care facilities? Who pays, the bottomless pocket of the taxpayer? Each of the 35 million people in California will need to pay $3,143 (per capita state and local taxes were roughly $1,600 in 1996).  Are the people of California going to be willing to forfeit three times their current tax burden?

If the benefits (reduction of earthquake related economic loss or lives lost) don't outweigh the costs in California, how can they be justified in the New Madrid Seismic Zone?

Joseph Tomasello, PE
5880 Ridge Bend Rd.
Memphis, TN 38120

Phone:
(901) 761-2016 office
(901) 821-4968 direct
(901) 412-8217 mobile

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[i] California Heathcare Association Statement on the Hospital Construction Plan Review and Area Compliance Process before the California Performance Review Commission, U.C. Riverside, August 13, 2004.

[ii] Ibid., 4

[iii] Ibid., 41

[iv] Ibid., 8

[v] Ibid., 30

[vi]  FEMA 366  Hazus 99 Estimated Annualized Earthquake Losses for the United States, February 2001, 16

[vii] California HealthCare Foundation, The Financial Health of California Hospitals, June 2007, 2-13

[viii] Ibid., (interviews with key unnamed health care leaders), B-6

[ix] The Press Democrat, Another hospital falls, what killed Sutter Medical Center - and what will it mean to families like mine, January 14, 2007
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