FEMA’s Proposed Changes to the National Flood Insurance Program

Photo by kevin dooley. Some rights reserved.

Earlier this month, law firm Van Ness Feldman published an Alert detailing FEMA’s plans for revising the National Flood Insurance Program (NFIP).

The NFIP was developed in the late 1960s in response to a few seasons of nasty natural disasters. It is a federal program that encourages landowners in participating communities to adopt and enforce FEMA approved floodplain management ordinances. Those communities are then eligible to purchase flood insurance through the program, which is designed to provide a financial alternative to relying on emergency disaster relief. According to FEMA, “the costs associated with flood damage are reduced by nearly $1.7 billion a year” through the program.

Not everyone has been happy with the NFIP, of course. According to Van Ness Feldman, ever since its adoption, the program has faced “ongoing significant criticism,” with critics claiming that it either doesn’t do enough, or does way too much, depending on whom you ask. (For instance, environmentalists have criticized FEMA’s failure to consult with USFWS and/or NMFS on the impact of the NFIP on endangered species.) It is supposedly these criticisms that have driven FEMA to reform the NFIP.

In a mid-May, FEMA filed a Notice of Intent to prepare an Environmental Impact Statement, proposing to evaluate the following proposed action and alternatives in their EIS:

(1) Modify the NFIP based upon changes identified through the evaluation process to enhance floodplain management standards including provisions to address endangered species and habitat concerns. This is FEMA’s proposed action.

(2) Taking no action, which would result in the continued administration and implementation of the NFIP as it stands today.

(3) Discontinue the NFIP, recognizing that only Congress can take this action.

(4) Request legislative authority to remove existing subsidies and cross subsidies for flood insurance policies.

(5) Modify the NFIP based upon changes identified through the evaluation process to enhance floodplain management standards including provisions to address endangered species and habitat concerns and request legislative authority to remove existing subsidies and cross subsidies for flood insurance policies.

Comments will be accepted on the Notice until July 16, 2012.

Learn more about the NFIP: FEMA on the basics, NFIP evaluation, and NFIP reform. You can also read about recent changes to the NFIP approved in late June by Congress as part of the Federal Public Transportation Act of 2012 (see Title II).

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