FEMA's new flood-zone maps

FEMA's new flood-zone maps are a sincere attempt to identify places at risk - Draconian rises in homeowners' insurance costs
New FEMA flood maps are a threat to home values.

On July 6, 2012, President Obama signed into law the Biggert-Waters Flood Insurance Reform Act. In the Senate, the bill had gone to the president without debate as an attachment to a transportation bill.

The purpose of the legislation was to reform federally subsidized flood insurance, which dates to 1968, and which by varying accounts was $18 to $26 billion in debt. Taxpayers in the high and dry have been subsidizing those in flood zones – many of them owners of million-dollar waterfront homes.

The new law continues subsidies for the time being for primary residences, under their current owners' current policies, and if they have not had major or repeated claims. Second homes, non-residences and properties with a history of claims will see their premiums rise 25 percent per year until rates reflect risk. That seems fair.

New maps seem rushed due to Sandy

Biggert-Waters also empowered the Federal Emergency Management Agency (FEMA) to update flood-zone maps. Some properties once in flood zones will find themselves high and dry. But in new maps that seem to have been rushed since Hurricane Sandy last year, thousands properties have been put into "velocity zones," or V-Zones – the highest risk for flooding. The New York Times (July 28, 2013) found New Jersey homeowners who would have been paying ten percent of the value of their property in premiums every year – until political push-back led FEMA to revise its new New Jersey maps.

The questions Biggert-Waters has loosed have many facets. Certainly, the spectacle of a bankrupt federal program subsidizing wealthy homeowners could not be defended. Certainly, in our waters, where sands are always shifting, we would not build today on low barrier beaches, or in a place like Billingsgate Island, off Wellfleet, which in the 19th century had a light house, 30 houses and a baseball team. Today, Billingsgate Shoal is visible at low tide.

FEMA's new flood-zone maps are a sincere attempt to identify places at risk of being inundated – future shoals – and to codify them for insurance purposes. On September 19, FEMA officials came to Duxbury to explain Biggert-Waters and to defend the new maps. We'll here ignore the broader aspects of Biggert-Waters and confine ourselves to questions about the implications of the maps for property owners.

The new maps are based on estimated 1 percent chance

The new flood-zone maps are based on the estimated one-percent chance of a storm surge in a given year (the 100-year storm) and .2 percent chance of a wave-less flood (the 500-year storm). Potential sea rise was not taken into consideration. Properties previously in the Special Flood Hazard Area (SFHA) are protected, as noted – though if a policy lapses, ownership changes, or FEMA declares excessive claims, the protection ends. Properties newly assigned to SFHAs will also be protected for up to five years. Some thoughts and questions:

  • Is it necessary for insurance purposes to anticipate the 500-year storm of 2213?
  • Projected sea-rise is not based on science, it is based on scientific modeling. What will actually happen could be a lot more or a lot less. Scientists understand that, and FEMA understands that modeling is not sufficient reason for draconian rises in homeowners' insurance costs.
  • The owner of a waterfront mansion has two advantages. First, he can afford to pay a five-figure increase in his flood insurance. Second, if he doesn't like it, he has the means to hire a combat lawyer to fight FEMA if it has offended him.

Threat to home values

The small property owner has neither advantage. For him, FEMA's new maps are a potential taking of his value, which amounts to a government taking without compensation. We recently Googled "homes for sale in Duxbury, Kingston and Plymouth for $300,000." We were surprised how many there are. It is these properties that are at risk of losing their value if FEMA's excessively conservative new maps are not successfully challenged.

More than vaguely, the process reminds us of the British Enclosure Acts between 1750 and 1860, when the commons where villagers had grazed for generations immemorial were closed to them, forever ending their way of life. In New England, the sea is our "commons." Some may welcome the disappearance of what in their view (sometimes literally) are unsightly shacks. Wiser heads will understand that a way of life is at stake.

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