HUD Announces Final Rule that will Protect Communities from Flooding Events and Rising Insurance Costs

By klrw460 April 22, 2024

WASHINGTON – The U.S. Department of Housing and Urban Development (HUD) today announced the publication of a new Federal Flood Risk Management Standard (FFRMS) in the Federal Register. The rule is designed to bolster community resilience against floods by enhancing preparedness and minimizing flood damage. This initiative will improve flood resistance, safeguard lives and property, lessen household damage, decrease insurance premiums, and protect federal investments, ensuring that federally funded building projects are better equipped to handle current and future flood risks.

HUD Acting Secretary Adrianne Todman stated, “I have personally seen the severe impact of flood disasters on families and communities, particularly on those who are least able to manage the emotional and financial strain of recovery. Today’s announcement by HUD aims to alleviate the impact of these disasters. As climate change intensifies, flood disasters are expected to become more frequent, severe, and financially draining. This rule will heighten awareness among renters and homeowners, thereby saving lives and cutting costs in the future.”

The new rule enforces the FFRMS as mandated by Executive Order 13690, amending HUD’s regulations concerning Floodplain Management and Protection of Wetlands and Minimum Property Standards. It raises elevation and floodproofing standards for federally funded properties in flood-prone areas, and applies to significant enhancements of structures funded through HUD’s various programs. The modifications to Minimum Property Standards specifically target FHA-insured new constructions within the 100-year floodplain.

Marion McFadden, Principal Deputy Assistant Secretary for Community Planning and Development, remarked, “By updating flood risk standards, HUD enables communities to accurately assess their flood risk. Often, those with limited means reside in high-risk flood zones and face prolonged recovery times after disasters. This rule ensures that HUD-supported properties are optimally protected against flooding. It’s our federal duty to guarantee that taxpayer-funded investments withstand foreseeable risks, which also helps in reducing flood insurance costs for property owners.”

HUD estimates that around 10% of new FHA single-family homes built annually are located within the 100-year floodplain, many of which are in areas with existing standards surpassing HUD’s previous criteria. The updated standard aims to minimize flood damage exposure, reduce insurance costs, and, most importantly, safeguard human life in high-risk flood zones.

Floods represent the most common and costly weather-related disaster in the U.S., causing billions of dollars in economic losses and significant health and recovery funding needs annually. In 2023, the Congressional Budget Office estimated that annual flood damages to homes with federally backed mortgages were around $9.4 billion, expected to rise to $12.8 billion by 2050. Just one inch of floodwater can cause between $10,000 and $27,000 in damages. The new elevation and floodproofing standards could save approximately $56.4 million to $324.3 million over 40 years due to reduced insurance premiums and flood damage.

The National Institute of Building Sciences reports that every $1 spent on elevating structures saves $6 in flood damage. Underserved communities, including those in formerly redlined areas, are at a 25% higher risk of flooding compared to other neighborhoods. There are notable successes in communities that have adopted these standards, such as Cedar Rapids, Iowa, and New Orleans, Louisiana, where elevated housing has significantly mitigated flood damage and recovery costs.

This rule is a proactive measure to preserve homes and lives, with more than 1,100 direct flood fatalities in the U.S. over the past decade. This year’s flood season could potentially affect around 122 million people. Currently, 80% of states and over 600 local communities require elevated building standards for flooding, underscoring the rule’s potential to save lives and expedite community recovery following flood events.

For more information, read the original press release from: