| Summary: | California’s Sacramento-San Joaquin Delta has fragile levees subject to several trends that make them increasingly prone to failure. To assess the likely extent of Delta island flooding, this study presents an economic decision analysis approach for evaluating Delta levee upgrade and repair decisions for 34 major subsided agricultural islands that make up most of the Delta’s Primary Zone and include all subsided, non-urban islands. The decision analysis provides a quantitative framework to address several relevant questions about reasonable levee upgrade and repair investments. This initial analysis indicates that it is economically optimal not to upgrade levees on any of the 34 subsided Delta islands examined, mostly because levee upgrades are expensive and do not improve reliability much. If upgrades can improve reliability more, it becomes optimal to upgrade some levees. Our analysis also suggests that, accounting for land and asset values, it is not cost effective to repair between 18 and 23 of these islands when they fail. When property values for all islands were doubled, only four islands originally not repaired become cost effective to repair. The decision analysis provides a quantitative framework for addressing several relevant questions regarding reasonable levee upgrade and repair investments. These initial results may act as a springboard for discussion, and the decision analysis model as a working framework for
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