Semi-finalist submission for the Leeds Net Impact Case Competition This year's case competition asked competitors to evaluate 4 infrastructure solutions that could be implemented to mitigate flooding damage costs for a small city on the Chesapeake bay. Each solution was to be evaluated from a triple bottom line perspective, be financially feasible, and avoid unnecessary tax increases.

1. City of Matthews RFP
Prepared by Conundrum Peak
Karen, Becca, Jake, Stu

2. Average total costs of flooding is estimated to rise
to $1.5 Bn a year by 2040 if left unchecked.
Matthews must improve its long term resilience
*Assuming total loss of at risk property
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400
600
800
1000
1200
1400
1600
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CostinMillionsofDollars
Year
Predicted Cost of No Mitigation
Nuisance Flood in Millions Big Flood Cost in Millions Flood Insurance Total
Stakeholder Perspective:
Matthews has 4 proposed infrastructure options for improving the city’s resilience, 1) Elevating all
buildings above FEMA base flood elevation, 2) building a berm spanning the coastline, 3)
creating a living shoreline, and 4) creating combination solution. However, the initial budget of
$500m is gone. Matthews must find an innovative solution for funding this initiative.

3. Conundrum peak believes that Matthews can fully fund the
project, reduce the financial impact of tidal flooding by 40-
45%, & create recurring, sustainable revenue sources for
the city
Matthews can reduce financial impact of flooding by 40-45%
Matthews should construct a 1 mile berm, add 2 miles of additional
wetlands, refit streets with permeable pavement, and add additional
infrastructure
Diminish rising annual
costs
Execute on combination
of Natural & Structural
Elements
Matthews can increase tourism and recreation opportunities, maintain
local beaches, create safer roads, and decrease in-town noise levels
Create streams of new
social value
Create new habitats for natural wildlife, reverse beach erosion, trap
harmful pollutants, slow tidal energy, and flooding occurrences
Reverse negative
environmental trends
Implement big data and predictive analytic tools that prevent growth of
flood insurance rates by accurately predict risk profiling
Incentivize digital
business model
innovation

4. Evaluating
Infrastructure Solutions

5. Option 1: Elevating all buildings above
FEMA base flood elevation
Financial Social Environmental
- $2.3 Bn in construction
costs
- Does not avoid business
interruption
+ Avoids $525 M in damages
in the event of a 100-year
storm
+ No maintenance Cost
- Does not avoid business
interruption
- Heavy short term
interruption from mass
construction
● No long term environmental
impact.
● Does not reverse current
trends

6. Option 2: constructing a berm
spanning the 3 mile coastline
Financial Social Environmental
+ $7.9m in construction
costs
+ $1.5m avoided in business
interruption
+ Avoids $426.5 M in
damages in the event of a
100-year storm
- Obstructs views
- Obstructs beach access
+ Preserves beach
- Cut off tidal marshes from the
ocean
- Habitat disruption for native
plants and animals
+ Slows beach erosion
- Traps runoff inland and
increases chances of adjacent
flooding

7. Option 3: Create a living shoreline
Adjust costs for wetland
Financial Social Environmental
- $480M in construction
costs (3 sq miles)
+ Avoids some business
interruption
+ Avoids $301 M in damages
in the event of a 100-year
storm
- $0.5 M yearly maintenance
- Wetland Banking payback
range $300m - $1.25b
- Loss of beach
- Decrease of beach tourism
+ Increased tourism for
wetlands
+ Increased of wetland
recreation opportunities
+ Reverse erosion
+ Expand natural habitats
+ Counteract wetland losses
+ Build up natural shoreline and
mitigate future flooding
http://www.ecosystemmarketplace.com/pages/dynamic/web.page.php?section=biodiversity_market&page_na
me=uswet_market

8. Option 4: Utilize structural & Natural
Elements
Financial Social Environmental
- $324 M to construct
* $320 M Wetands (2 sq miles)
* $2.6 M Berm (1 mile)
* $1.1 M Perm. Pavement
+ $1.5 M avoided in business
interruption
+ Avoids $400 M in damages in
the event of a 100-year storm
+ $2 M yearly maintenance
+ Wetland Banking payback
range $200m - $836m
Wetlands:
- Minimal loss of beach
+ Increased tourism
Berm:
- Obstructs views
- Obstructs beach access
+ Slows beach erosion
Permeable Pavement:
+ Attractive
+ Safer in wet conditions
+ Quieter than roads
Wetlands:
+ Reverse erosion
+ Create habitats
+ CO2 Mitigation
+ Build up natural shoreline and
mitigate future flooding
Berm:
- Disrupt habitats
Permeable Pavement:
+ Traps harmful pollutants
http://www.ecosystemmarketplace.com/pages/dynamic/web.page.php?section=biodiversity_market&page_na
me=uswet_market

9. The combination solution proves to be the most fiscally
responsible option while providing the most social benefit
and reversing negative environmental trends
Financial Social Environmental
Elevate Buildings ✖ ✖ -
Construct Physical
Barrier ✓ ✖ ✖
Create a Living
Shoreline ✓ - ✓
Utilize Structural &
Natural Elements ✓ ✓ ✓

10. In addition to implementing a a combination solution,
we suggest an additional 7 mile boardwalk and trail
system to maximize social impact
• Boardwalk costs are flexible,
ranging from $8m -$10m
dependent on materials quality.
• The boardwalk brings
accessibility to the beach, city,
and wetlands
• Brings total cost of the project to
$332m – $334m

11. Project Timeline
0 Years
● Receive funds
● Berm and boardwalk
construction begins
● Wetland preparation
& planting
● Permeable pavement
construction begins
2-3 years
● Permeable
Pavement, Berm
Completed
● Boardwalk
construction
continues
● Wetland
construction begins
3-6 Year
● Boardwalk
Completed
● Wetland
construction
continues
6-10 Years
● Wetland
Completed
http://cascadiaprairieoak.org/wp-content/uploads/2014/12/Wetland-Prairie-Guide-FINAL-8_25_14-1.pdf

12. Analyzing infrastructure
funding scenarios

13. Wetland funding scenarios $320
Million
• Allow private
investors to
develop wetlands
and sell credits:
Revenues between
$200m - $836m
• Reduces risk as
well as capital
needed
• Sales can be split
into parcels
Public Private
Partnerships
• Could be used in
stages to build
wetlands
• Wetland credit
sales to fund future
rounds
• Would significantly
increase the
implementation
timeline
Municipal Bonds
• Much too small to
establish significant
wetlands
Grants
http://www.dat.state.md.us/sdatweb/taxrate.html
http://www.ecosystemmarketplace.com/pages/dynamic/web.page.php?section=biodiversity_market&page_
name=uswet_market
A B C

14. • Small enough to be handled by
tax base
• Covers $2.6M berm costs.
• High flood mitigation for small
investment
Municipal Bonds
• There are many non-point
source pollution grants and
Chesapeake Bay preservation
funds that could help fund
permeable pavement projects.
• Confident we can cover $1.1
M needed for permeable
pavement. Up to $2 m
available.
Grants
Berm and permeable pavement funding
scenarios $3.7 Million
A A
http://dnr.maryland.gov/watersheds/pubs/planninguserguide/tools/Tool4FundingResources.pdf

15. • Can be directly voted on by the
community
• Bond can easily be supported
by property tax base of $42 M
Municipal Bonds
• Scale of the project is suitable
for private donation
• Citizens will directly enjoy the
benefits
• Similar projects such as the
Boise River Park have targets
to receive $6.3M in private
funding. Timeline could
span 10+ years
Private Donations
Boardwalk funding scenarios
$8 million
http://www.dat.state.md.us/sdatweb/taxrate.html
http://www.ecosystemmarketplace.com/pages/dynamic/web.page.php?section=biodiversity_market&page_
name=uswet_market
A B

16. Digital Innovation models

17. Comparables:
● The Climate Corporation uses IoT devices and
applications to monitor and accurately predict crop
yields. Data is for developing risk profile for climate
insurance, allows for claim filing when yield losses are
predicted. Adjusters deployed based on advanced
forecasting.
● CSC ClimatEdge offers probabilistic climate analytics
to general insurance providers allowing them to make
business decisions based on climate risks. Current
application is for tornado monitoring but flood
applications are being developed.
● Marcell device monitors temperature, humidity,
resistivity, and moisture. Alerts homeowners of
incidents of property damage such as broken water
mains.
The insurance industry is currently transforming from
digital innovation. IoT devices allow for more accurate
damage prediction, immediate claim filing, & increased
confidence in risk profiling.
http://innovationtrail.org/post/home-monitoring-device-aims-prevent-property-damage
http://climate.com/company/press/releases/over-50-million-acres-of-climate-basic-on-farms-across-the-u-s/
http://www.csc.com/innovation/insights/109257-weather_and_flood_data_services_csc_climatedge

18. Predictive analytics provides a compelling use
case for NFIP providers. FICO has outlined the
following use cases:
Benefits:
• Improves margins by selecting
and pricing risks
• Focus limited resources on
exceptional cases
• Differentiate insurance services
through faster response times
• Lower loss ratio to help mitigate
risks
• Drive down insurance rates
Outcomes
• Precisely assess risks
presented by commercial
insurance clients
• Automated underwriting
powered by predictive analytics
• Better understand the sources of
drivers of risk
• Demonstrate to reinsurers clear
ability to consistently and
accurately rate book of
business
http://www.fico.com/en/wp-content/secure_upload
Predictive_Models_Commercial_Insurance_Underwriting_2116PS.pdf

19. Predictive analytics create a virtuous cycle
which leads to long term sustainable
behavior
Collect Real-Time data
from NOAA & NWS as
well as IoT devices
Enable predictive
analytics for flood
related damages
Insurance providers
actively manage risk
profile
Insurance pricing
becomes more dynamic
and decreases for
Matthews
Citizens can monitor
risk profile and change
behavior
Citizens will be more ready to implement infrastructure solutions
that impact their personal risk profile

20. Social impact bond model is ideal for
incentivizing private innovation for public
projects
• Pay for Success bonds currently used for
social impact projects, but potential to
expand to environmental issues
• Metric-based maturity
-No upfront cost to the town
-Payment only once benefits have been
realized in the form of lower insurance
• $3m bond is ample for funding private IoT
business models
http://www.whitehouse.gov/omb/factsheet/paying-for-success

21. To conclude, it is not too late for Matthews to implement an
achievable and sustainable infrastructure project to improve
flood resilience.
Matthews can reduce financial impact of flooding by 40-45%
Matthews should construct a 1 mile berm, add 2 miles of additional
wetlands, refit streets with permeable pavement, and add additional
infrastructure
Diminish rising annual
costs
Execute on combination
of Natural & Structural
Elements
Matthews can increase tourism and recreation opportunities, maintain
local beaches, create safer roads, and decrease in-town noise levels
Create streams of new
social value
Create new habitats for natural wildlife, reverse beach erosion, trap
harmful pollutants, slow tidal energy, and flooding occurrences
Reverse negative
environmental trends
Implement big data and predictive analytic tools that prevent growth of
flood insurance rates by accurately predict risk profiling
Incentivize digital
business model
innovation

22. Appendix