About Hilary Tuttle

Hilary Tuttle is the editor of the Risk Management Monitor and Risk Management magazine.

Houston Faces ‘Largest Flooding Event Since Tropical Storm Allison’

Historic flooding has left the Houston metropolitan area inundated once again this week, killing at least seven people, flooding 1,000 homes and causing more than $5 billion in estimated damages in Harris County alone. Gov. Greg Abbott declared a state of disaster for nine counties in and around the Houston area. The widespread nature of the disaster prompted the city of Houston to call this the largest flood event since Tropical Storm Allison, which devastated southeast Texas in 2001, causing $9 billion in damage and $1.1 billion in insured losses.

According to Harris County Judge Ed Emmett, about 240 billion gallons of rain fell on the Houston area this week. That’s the equivalent of 363,400 Olympic-size swimming pools, CNN reported. After 10 inches of rainfall fell in six hours Sunday night into Monday, powerful, slow-moving thunderstorms had paralyzed the region Monday, but storms continued through Wednesday.

Having some of the hardest rainfall overnight helped a bit to mitigate the dangers this week. While this made it difficult to predict, it allowed people to better make choices about going out, as opposed to last year’s floods around Memorial Day, Emmett told the Houston Chronicle. Nevertheless, emergency crews made more than 1,200 high-water rescues, many residents had to evacuate to shelters, and for those who were able to shelter in place, 123,000 homes had no power at the height of the flooding. Officials have also expressed concern about two local dams that have been rated “extremely high risk and are at about 80% capacity, but they are not in immediate danger of failing.

As I wrote in Risk Management last year, the city’s rapid urbanization and approach to land development have made it extremely vulnerable to flooding perils because there is little land surface that can absorb water in foul weather. Rivers, bayous and other receptacles for runoff are easily overwhelmed and take a considerable amount of time to return to normal levels, making the heavy, concentrated, sustained rainfall seen this week even more dangerous in such an urbanized setting. Last May, record rainfall and severe thunderstorms caused tremendous damage across Texas and Oklahoma, killing 32 people and flooding more than 5,000 homes in the metro regions of Houston, Austin and Dallas.

With this latest storm, Houston again offers a powerful reminder about the natural catastrophe perils compounded by urbanization and the need to prepare, both in the form of routine disaster preparation and urban planning. From the August issue of Risk Management:

The city has invested hundreds of millions of dollars to battle the effects of urbanization. On Buffalo Bayou alone, for example, flood control efforts totaling half a billion dollars in the past decade have included bridge replacements, the addition of detention ponds for runoff, and creation of green spaces that serve as parks in normal weather while offering more land surface that can absorb water in foul weather.

But the investments are not enough. “Houston may be doing things to try to improve…but there’s a long history of pre-existing stuff that is still there,” Walter Peacock, an urban planning professor at Texas A&M and director of the school’s Hazard Reduction and Recovery Center, told Time. “Think about every time you put in a road or a mall and you add concrete—you’ve lost the ability of rain to get into the soil and you’ve lost that permeability. It’s now impermeable, and therefore you get more runoff.”

Temple University Wins 2016 Spencer-RIMS Challenge

spencer rims challenge 2016

SAN DIEGO—A team of students from Temple University won this year’s Spencer-RIMS Risk Management Challenge, concluding a three-month case-study challenge against 20 other universities. Team members Andrew Donchez, Carolyn Murset, Sean Preis and Zilong Zhao, advised by Associate Professor R. B. Drennan, will take home the competition’s $4,000.

This year, Lego provided a case study for teams from 21 universities to studied the risk portfolio and develop an array of proposed solutions. Eight teams were then invited to attend the RIMS 2016 Conference here in San Diego to present their findings to judges and an audience of risk professionals.

“All of the students who took part in the Spencer-RIMS Risk Challenge are winners,” said Ron Davis, the newly elected chair of the Spencer Educational Foundation. “Each university team was prepared, smart and successfully delivered innovative risk management solutions for a very complex situation. It is truly rewarding to see them have the opportunity to shine during this competition and validates the critical work we do to support tomorrow’s risk management professionals.”

“This competition reinforces that the risk management profession’s future is bright,” said RIMS CEO Mary Roth. “The Rising Risk Professional demographic of RIMS members continues to grow and their contributions and professional needs have directly influenced the resources and opportunities the Society delivers. We are so proud to be able to introduce these students to the energy and excitement of a RIMS Annual Conference and congratulate all of them for participating in the challenge.”

Second place went to Florida State University, while the team from Butler University took third. The Temple team won $4,000, FSU $3,000 and Butler $2,000 for their achievements.

RIMS Presents Risk Management Industry’s Top Honors

RIMS16_Award_Winners-7SAN DIEGO—During today’s RIMS 2016 Annual Conference & Exhibition Awards Luncheon, RIMS doled out its highest honors to several prominent members of the risk management industry.

The risk management society presented Christopher E. Mandel, senior vice president of strategic solutions at Sedgwick Claims Management, Inc., with its top honor, the Harry and Dorothy Goodell Award for outstanding service and achievement to the risk management discipline.

“The risk management community is filled with exceptional professionals but few have had the remarkable career achievements and broad industry impact as Chris Mandel,” said RIMS CEO Mary Roth. “To this day, Chris continues to give back to the profession through his involvement with RIMS and at Sedgwick. He is a wonderful example of the best this profession has to offer and it is our honor to present him with RIMS’ highest award.”

Mandel served as 2002 RIMS president, and has fulfilled 19 distinct roles for the society and delivered dozens of workshops for other risk professionals since becoming a RIMS workshop instructor 2010, with particular emphasis on enterprise risk management and strategic risk management.

This year’s Risk Management Hall of Fame inductees are David Mikulina and William H. (Bill) McGannon. Mikulina headed the risk management department at Hyatt Hotels Corporation for 23 years before his retirement in 2007, and still enjoys sharing his insights with rising and veteran risk management professionals alike as a longstanding RIMS member. McGannon was one of the first Canadian risk managers to establish a full-service risk management department that included loss prevention and statistical support at NOVA Chemical Corporation in Alberta. After his retirement in 1998, he frequently lectured at the University of Calgary and traveled to Scotland to participate in the Risk Manager in Residence program. While McGannon passed away in 2015, his legacy in the risk community lives on, particularly through the William H. McGannon Foundation, which provides scholarships, research grants and student involvement initiatives to advance risk management by way of education, research, mentorship and work experience programs.

“Although the risk management profession has evolved significantly, the achievements of its early pioneers continue to have lasting influence on the processes and strategies used today,” said RIMS Chief Executive Officer Mary Roth. “Whether it was enhancing their organization’s already complex risk program or devoting themselves to supporting the promising careers of future risk management leaders, this year’s Risk Management Hall of Fame inductees have unquestionably made substantial contributions to the profession and RIMS.”

“We are pleased to recognize Bill and Dave for significant achievement in their professional careers and their contributions to shaping the risk management discipline,” said Rob Schimek, CEO of AIG Commercial.

RIMS and Business Insurance presented Gus Fuldner, head of insurance for Uber Technologies, with the 2016 Risk Manager of the Year Award.

In recognition for her outstanding performance in furthering risk management with the RIMS Memphis Chapter, Sedgewick Senior Vice President of Risk Management Robin Joines received the Ron Judd “Heart of RIMS” Award.

RIMS also announced its first inductees into the RIMS Ambassador Group, which recognizes individuals for their continued service with the organization. Darius Delon, South Alberta Chapter member and associate vice president of risk services at Mount Royal Univeristy, and Daniel McGarvey, Western Carolina Chapter member and managing director at Marsh, both recived this award for going above and beyond to help strengthen and support the society’s strategic initiatives.

The RIMS Rising Star Award was presented to Alumine Bellone, director of risk and insurance for Broward Health, and Kathleen Crowe, account specialist II for Aon Risk Solutions were honored for demonstrating exceptional initiative, volunteerism, professional development, achievement, and leadership potential.

David Engel, director of risk management for AT&T, received the Cristy Award, presented to the individual with the highest marks on the three exams required to earn the Associate of Risk Management designation.

California and New York Agree to $15 Minimum Wage

Yesterday, the governors of California and New York reached agreements with state lawmakers to become the highest-paid minimum wage states in the country with an increase to $15 an hour. A minimum wage bill passed the California legislature on Thursday, and Gov. Jerry Brown said he will sign the measure on Monday. Late that night across the country, Gov. Andrew Cuomo reached a tentative agreement with New York’s top legislators to do the same with the state’s base wage.

According to the AP, President Barack Obama, who first proposed an increase to the $7.25 federal minimum wage in 2013, applauded the states’ actions and called on the Republican-controlled Congress to “keep up with the rest of the country.”

Currently, California and Massachusetts are tied for the highest state minimum wages at $10 an hour, while New York’s current rate is $9. Only Washington, D.C., at $10.50 per hour, is higher.

From the Department of Labor, here’s a look at how your state measures up:state minimum wage laws

Both California and New York plan to phase in the new rates, which will impact about 2 million employees in each state. In California, the increases would start with a boost from $10 to $10.50 on Jan. 1, and businesses with 25 or fewer employees would have an extra year to comply. Increases of $1 an hour would come every January until 2022, although the governor could delay these increases in the event of significant budgetary or economic downturns.

Cuomo originally proposed a simpler adjustment in New York: three years in New York City and six years in the rest of the state. Negotiations with local lawmakers who expressed concern the sharp increases would “devastate” business owners produced a more gradual approach. The AP reported, “In New York City, the wage would increase to $15 by the end of 2018, although businesses with fewer than 10 employees would get an extra year. In the suburbs of Long Island and Westchester County, the wage would rise to $15 by the end of 2022. The increases are even more drawn out upstate, where the wage would hit $12.50 in 2021, then increase to $15 based on an undetermined schedule.”

These changes come as considerable progress for the “Fight for 15” movement to raise minimum wages across the country. As Will Kramer reported in Risk Management magazine, debates over income inequality in the United States and the “Fight for 15” movement have gathered strength over the past five years. Many credit the Occupy Wall Street movement that began in New York City’s Zuccotti Park in September 2011 with spurring the increased focus on wealth and economic inequality, particularly the divide between the 99% and the 1%.

The impacts have been gaining further momentum recently. Kramer explained, “As of mid-2015, Seattle, San Francisco and Los Angeles have begun phasing in a $15 minimum wage. Democratic presidential candidate Sen. Bernie Sanders introduced Congressional legislation to raise the federal minimum wage to $15 per hour. What was once considered inconceivable has become more and more commonly accepted as a necessary and even moral imperative for many American businesses.”

Check out more from Kramer’s article on the growing debate over income inequality and its implications for businesses in Risk Management.