The Role of Public Wealth in Recovery and Resiliency to Natural Disasters in Rural Communities

Hurricanes Katrina, Rita, and Gustav have heavily influenced county and parish governments in the northern Gulf Coast. In particular these storms have presented immediate fiscal challenges, including the financing and management of cleanup efforts, as well as long-term fiscal health issues. The combination of delayed and capped reimbursement levels has highlighted the need for understanding how pre-disaster fiscal health influences both short- and long-term county fiscal health. A higher value is generally favorable, as it indicates efficient use of assets for revenue generation. Profitability ratios measure an entity's ability to utilize resources to generate net revenue necessary to meet the increasing costs of delivering public services. The initial value of the financial ratio controls for a county government's past financial performance and should be indicative of future financial performance.