Stakeholder dynamics in disaster mitigation funding: The roles of timing, spatial scale and allocation basis in policy design

The structure of disaster mitigation funding programs—when funds are distributed and how they are targeted—can shape not just how much risk is reduced, but which areas are protected, which actions are taken, and which stakeholders bear the remaining losses. While many programs focus on what gets funded, far less attention has been paid to how funding structures shape long-term outcomes across different stakeholders. This study evaluates the effects of five funding designs on risk reduction, household expenditure, and insurer outcomes in the context of repeated hurricane impacts. The designs vary across temporal scale (consistent annual funding vs. disaster-triggered), spatial scale (state-wide vs. local), and allocation basis (past damage or future risk). We use a multi-stakeholder decision-making framework to assess the outcomes of each design in eastern North Carolina. State-wide allocations achieve greater risk reduction outcomes than local allocations by increasing acquisition participation rates and concentrating efforts in a few areas with highest mitigation benefits. Consistent annual funding is more efficient than disaster-triggered, although the magnitude of the difference depends on when hurricanes occur and the level of the consistent funding. Designs that concentrate resources achieve larger aggregate reductions, but at the expense of more uneven geographic distribution. Across all designs, low rates of household participation limit the realized benefits. These findings highlight how funding design choices shape both the effectiveness and distribution of disaster mitigation, with important implications for federal and state policy.