Applied ML Systems · Capstone brief
DS-21 · What a storm costs
Using historical storm event records, model reported property damage from event characteristics — and then confront how badly damage reporting behaves as a target variable.
The question
Using historical storm event records, model reported property damage from event characteristics — and then confront how badly damage reporting behaves as a target variable.
Data
NOAA Storm Events Database (https://www.ncei.noaa.gov/access/storm-events-database/). Census ACS housing values for exposure (https://www.census.gov/data/developers/data-sets/acs-5year.html).
Expected failure modes
Damage figures are entered inconsistently, sometimes as strings like "2.5M", and are not inflation-adjusted. Reporting completeness has improved over decades, so trends conflate real change with better record-keeping. Zero-damage events vastly outnumber costly ones, producing a heavily skewed target.
Done looks like
A damage model with inflation adjustment applied, the skewed target handled deliberately (transformation or a two-stage approach), and reporting-completeness change addressed before any trend claim.
Five C's
CT: separating reporting change from real change. CR: handling a zero-inflated skewed target. CO: peer audit of the parsing logic. CM: a risk summary for an emergency manager. CZ: disaster funding decisions rest on these records.
Mentor role
An emergency manager, insurance analyst, or climate risk professional reviews the target handling at Checkpoint 1 and trend claims at Checkpoint 2. School-supervised.
Rubric calibration
R1: scoped to event type and region. R2: damage strings parsed and inflation-adjusted, with the parser validated. R3: a mean-damage baseline. R4: performance reported on the costly tail specifically. R5: usable by an emergency manager. R6: no trend claim without a completeness argument.
Two ways this goes wrong
(a) "2.5M" parses as 2.5 and a tornado outbreak becomes cheaper than a hailstorm. (b) The student reports rising storm damage and has measured improved reporting plus inflation.
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