Good. Get those distortionary effects out of flood prone real estate markets. Why folks who buy safer properties should be punished by subsidizing those in high risk areas is beyond me.
Flooding happens all over the country. 40% of all NFIP claims are paid in areas that are not considered Special Flood Hazard Areas. Look at Colorado this year, New Jersey/New York and Nashville last year. These people don’t carry flood insurance at all because they believe they can’t flood. If they want to make the NFIP actuarially sound they should simply require everyone that has a federally backed mortgage to carry flood insurance. The rates would be reasonable and the rest of the country wouldn’t have to bail these people out with government assistance when floods happen. Most people in St Louis don’t carry flood insurance. They probably should.
Homeowners that have never been flooded should not be expected to make up the deficit of the National Flood Insurance Program (NFIP) when FEMA gives, what appear to be unjustified, massive premium reductions to gulf front condominium buildings that have been paid millions of dollars in NFIP flood claims.
July 6, 2012: The President signed the Biggert-Waters Act authorizing a five year extension of funding for the National Flood Insurance Program (NFIP). It was also intended to make the program actuarially sound. Implementation of sections 205 and 207 of the Biggert Waters Act is going to create tremendous rate increases for thousands of homeowners and small businesses along the entire gulf coast along with coastal properties around the country. This action doesn’t seem to be justified when you consider the fact that over the last three years FEMA approved Letters of Map Revision (LOMR) on Alabama’s Gulf Front condominium buildings that they had previously placed in the NFIP Repetitive Loss Program. These condominium buildings received millions of dollars in NFIP claim payments yet FEMA decided they are not in velocity flood zones and reduced their flood premiums by an average of almost 93%?
2009: In 2009 a company out of South Florida, Flood Zone Corrections (FZC), started submitting condominium buildings located in very unfavorable “V” flood zones to the NFIP/FEMA in an attempt to have them changed to more favorable “A” flood zones. FZC also operates as Flood Risk Solutions. All of these buildings were located on the beaches of Orange Beach and Gulf Shores, Alabama. FZC submitted the buildings even though they were located in high velocity flood areas. Local flood engineers said these buildings would not qualify for LOMRs and most refused to attempt any rezoning. Many of these buildings had been heavily damaged from flooding during Hurricanes Erin and Opal in 1995, Hurricane Danny in 1997, Hurricane Georges’ in 1998 and all of them suffered massive flood damage during Hurricane Ivan in 2004. If approved for LOMR’s these condominium buildings would pay flood premiums that were a very small percentage of what they were currently paying.
The Flood Plain Managers from Gulf Shores and Orange Beach assumed the NFIP would decline the request for LOMR’s because the NFIP was operating at an $18 billion deficit at that time and many of these buildings had already been placed in the NFIP Repetitive Loss Program. Both Flood Plain Managers disagreed with the information FZC was submitting to the NFIP and each one of them refused to sign concurrence letters that were required when applying for a LOMR.
June 6, 2011: The NFIP/FEMA approved LOMR’s for four condominium buildings located on East Beach Boulevard in Gulf Shores. One of the buildings had received over $400,000 from the NFIP for their Hurricane Ivan flood claim. The other three were new buildings that were built on lots where the prior building had been destroyed by flooding during Ivan.
June 2011: The offices of Alabama Senator Richard Shelby, Mississippi Senator Roger Wicker and Alabama House Representative Spencer Bachus were notified of the negative financial impact approval of the LOMR’s were having on the NFIP. All of these Congressmen were working on new legislation that would extend NFIP funding and each one had expressed considerable concern that the program was operating at a deficit of $18 billion. Their representatives contacted representatives of the NFIP and were assured the flood zone changes were justified. All three offices dropped the issue soon afterward.
2011: The NFIP/FEMA was approached and asked to put a moratorium on future LOMR approvals until the new flood mapping project was completed for Alabama. The NFIP said they would review the issue. No moratorium was ever put in place and now the program operates at more than a $24 billion deficit.
October 4, 2011: 14 more Gulf Shores condominium buildings are approved for LOMR’s
June 4, 2012: 7 more Gulf Shores condominium buildings are approved for LOMR’s
March 11, 2013: Although Biggert-Waters had already been passed, 41 more Gulf Shores condominium buildings are approved for LOMR’s
June 17, 2013: Another Gulf Shores condominium building is approved for a LOMR
December 6, 2013: Another Gulf Shores condominium has been approved and the LOMR will be effective on 12/6/2013
September 2013: Based on the most recent edition of NFIP/FEMA flood maps there are 72 residential condominium buildings located in very unfavorable “V” flood zones in Gulf Shores alone. As of September 2013, FZC has obtained LOMR’s on 66 of these Gulf Shores condominium buildings while 2 were declined. FZC is currently working to secure LOMR’s on the remaining 4 buildings. There were also 4 or 5 high rise condominium buildings approved for LOMR’s in Orange Beach during that time.
It appears the total combined annual revenue loss to the NFIP/FEMA for the condominium buildings in Gulf Shores and Orange Beach is somewhere between $5,500,000 and $6,000,000 a year.
If the intent of Congress is to make the program actuarially sound why did they, and do they continue to allow the NFIP/FEMA to approved these buildings for LOMR’s without investigating this issue in detail?
After LOMR approvals, the average flood premium for the approved gulf front condominiums is approximately $.069/$100. How can the NFIP/FEMA possibly justify charging homeowners in “X” zones, which are not Special Flood Hazard Areas, almost twice as much flood rate as these condominium buildings pay? Most homes located in “X” zones pay a minimum of approximately $0.12/$100.
The new preliminary flood maps for Alabama and NW Florida are not scheduled for release until December of 2014. The new permanent maps will not be put into effect until 2015.
When you look at the facts you question how the NFIP/FEMA, with a program operating at a $24 billion deficit, can justify any premium reduction on these high risk properties then proceed with the implementation of sections 205 and 207 of Biggert Waters? Obviously FEMA officials and Congress expect innocent homeowners that followed FEMA’s rules to make up this deficit. Why doesn’t Congress or FEMA initiate an internal investigation and get to the bottom of this issue? Why don’t they delay the implementation of sections 205 and 207 until this investigation is complete? These condominium owners are receiving what appear to be extremely low unjustified flood rates at the expense of coastal homeowners around the entire country. No individual homeowner or small business owner should have flood premiums raised until Congress and FEMA get to the bottom of this issue.
If these politicians feel so strongly about the rates, why don’t they open their own flood insurance program with their OWN money and run it? Then they can keep the rates as low as they want. But as long as it’s using tax payer money to subsidize, then let the rate increases tax affect.
Agree, rates should increase but can you really be confident that a dysfunctional Gov’t agency made the correct rate calculations? $1000 increased to $10,000 doesn’t make sense.
We are so confused and bewildered that the government can allow this to happen. Ok so I agree sometimes the funding just runs out and programs have to be shut down, but my husband and I bought our investment property October, 2012… we moved to Florida 5 years ago, after reestablishing ourselves we did think it would be a good investment to purchase rental property… believe me it’s not much, a small 850 sq ft duplex, but we invested our life savings. No one at the time informed us that we had subsidized insurance, no one informed us that a bill had just been passed 3 months prior which was going to greatly affect us in our insurance. The realtor claims they knew nothing and it was only made public a couple months ago, the insurance agent makes claims on the same, as well as the banker and mortgage broker. When they approved us for a mortgage on the home they had to know the amount of insurance to be sure that we could afford the insurance and home. Of course everyone expects insurance to increase maybe 10% a year… but not tenfold. I can’t possibly imagine NO ONE knew… now our big life savings of 45000.00 might possibly be gone and the bank will be laughing. Is it true no one knew of this bill being passed in July 2012 till just now????
Kathy, I own a home in an area that got damaged by Sandy that did not have flood insurance. I was never old when my home was zoned into a flood zone in 2009 nor was I told of biggert waters. I got flooded in Sandy and I had to buy Flood insurance in November 2012 as part of condition of grant.
I most certainly would have bought flood insurance right before we were zoned into flood in 2008 to take advantage of grandfathering and at the very least bought flood insurance in June 2012. My rates would have been locked superlow. FEMA/NFIP basically announced new rates in September 2012. I know realtors selling houses in September 2012 who did not tell clients about this nor agents selling flood quotes in Summer 2012.
RE Agents get paid commission and represent buyers. Insurance agents get paid commission on annual cost of flood insurance. Guess what your insurance quardruples the agent commission quadruples. No one had any interest in telling you. Least of all fema/nfip they got the house from grandfathered subsidized to full risk when you bought it. It was in everyones interest but yours for you to know.
Something must be done with this Act, even Representative Waters the author of this Act regrets what she did. This Act with the increase will affect millions forcing them to leave their homes since they will not be able to afford the increases. I for one a retired individual who found the location of my home might be forced out. Not only will it affect homeowners throughout the country but in coastal area tourism because of the hotels having increases thereby passing the increases on to customers. It will hurt our economy when we are just starting to recover from a recession. I just can’t understand it, why not start a National Catastrophic fund requiring every homeowner to pay something like 25 dollars to cover any disasters within the country. We must stop this Biggert-Waters Act with these increases !!!!!!
Good. Get those distortionary effects out of flood prone real estate markets. Why folks who buy safer properties should be punished by subsidizing those in high risk areas is beyond me.
What does flood have to do with health care?
Flooding happens all over the country. 40% of all NFIP claims are paid in areas that are not considered Special Flood Hazard Areas. Look at Colorado this year, New Jersey/New York and Nashville last year. These people don’t carry flood insurance at all because they believe they can’t flood. If they want to make the NFIP actuarially sound they should simply require everyone that has a federally backed mortgage to carry flood insurance. The rates would be reasonable and the rest of the country wouldn’t have to bail these people out with government assistance when floods happen. Most people in St Louis don’t carry flood insurance. They probably should.
Biggert – Waters Act… Long read but interesting
Homeowners that have never been flooded should not be expected to make up the deficit of the National Flood Insurance Program (NFIP) when FEMA gives, what appear to be unjustified, massive premium reductions to gulf front condominium buildings that have been paid millions of dollars in NFIP flood claims.
July 6, 2012: The President signed the Biggert-Waters Act authorizing a five year extension of funding for the National Flood Insurance Program (NFIP). It was also intended to make the program actuarially sound. Implementation of sections 205 and 207 of the Biggert Waters Act is going to create tremendous rate increases for thousands of homeowners and small businesses along the entire gulf coast along with coastal properties around the country. This action doesn’t seem to be justified when you consider the fact that over the last three years FEMA approved Letters of Map Revision (LOMR) on Alabama’s Gulf Front condominium buildings that they had previously placed in the NFIP Repetitive Loss Program. These condominium buildings received millions of dollars in NFIP claim payments yet FEMA decided they are not in velocity flood zones and reduced their flood premiums by an average of almost 93%?
2009: In 2009 a company out of South Florida, Flood Zone Corrections (FZC), started submitting condominium buildings located in very unfavorable “V” flood zones to the NFIP/FEMA in an attempt to have them changed to more favorable “A” flood zones. FZC also operates as Flood Risk Solutions. All of these buildings were located on the beaches of Orange Beach and Gulf Shores, Alabama. FZC submitted the buildings even though they were located in high velocity flood areas. Local flood engineers said these buildings would not qualify for LOMRs and most refused to attempt any rezoning. Many of these buildings had been heavily damaged from flooding during Hurricanes Erin and Opal in 1995, Hurricane Danny in 1997, Hurricane Georges’ in 1998 and all of them suffered massive flood damage during Hurricane Ivan in 2004. If approved for LOMR’s these condominium buildings would pay flood premiums that were a very small percentage of what they were currently paying.
The Flood Plain Managers from Gulf Shores and Orange Beach assumed the NFIP would decline the request for LOMR’s because the NFIP was operating at an $18 billion deficit at that time and many of these buildings had already been placed in the NFIP Repetitive Loss Program. Both Flood Plain Managers disagreed with the information FZC was submitting to the NFIP and each one of them refused to sign concurrence letters that were required when applying for a LOMR.
June 6, 2011: The NFIP/FEMA approved LOMR’s for four condominium buildings located on East Beach Boulevard in Gulf Shores. One of the buildings had received over $400,000 from the NFIP for their Hurricane Ivan flood claim. The other three were new buildings that were built on lots where the prior building had been destroyed by flooding during Ivan.
June 2011: The offices of Alabama Senator Richard Shelby, Mississippi Senator Roger Wicker and Alabama House Representative Spencer Bachus were notified of the negative financial impact approval of the LOMR’s were having on the NFIP. All of these Congressmen were working on new legislation that would extend NFIP funding and each one had expressed considerable concern that the program was operating at a deficit of $18 billion. Their representatives contacted representatives of the NFIP and were assured the flood zone changes were justified. All three offices dropped the issue soon afterward.
2011: The NFIP/FEMA was approached and asked to put a moratorium on future LOMR approvals until the new flood mapping project was completed for Alabama. The NFIP said they would review the issue. No moratorium was ever put in place and now the program operates at more than a $24 billion deficit.
October 4, 2011: 14 more Gulf Shores condominium buildings are approved for LOMR’s
June 4, 2012: 7 more Gulf Shores condominium buildings are approved for LOMR’s
March 11, 2013: Although Biggert-Waters had already been passed, 41 more Gulf Shores condominium buildings are approved for LOMR’s
June 17, 2013: Another Gulf Shores condominium building is approved for a LOMR
December 6, 2013: Another Gulf Shores condominium has been approved and the LOMR will be effective on 12/6/2013
September 2013: Based on the most recent edition of NFIP/FEMA flood maps there are 72 residential condominium buildings located in very unfavorable “V” flood zones in Gulf Shores alone. As of September 2013, FZC has obtained LOMR’s on 66 of these Gulf Shores condominium buildings while 2 were declined. FZC is currently working to secure LOMR’s on the remaining 4 buildings. There were also 4 or 5 high rise condominium buildings approved for LOMR’s in Orange Beach during that time.
It appears the total combined annual revenue loss to the NFIP/FEMA for the condominium buildings in Gulf Shores and Orange Beach is somewhere between $5,500,000 and $6,000,000 a year.
If the intent of Congress is to make the program actuarially sound why did they, and do they continue to allow the NFIP/FEMA to approved these buildings for LOMR’s without investigating this issue in detail?
After LOMR approvals, the average flood premium for the approved gulf front condominiums is approximately $.069/$100. How can the NFIP/FEMA possibly justify charging homeowners in “X” zones, which are not Special Flood Hazard Areas, almost twice as much flood rate as these condominium buildings pay? Most homes located in “X” zones pay a minimum of approximately $0.12/$100.
The new preliminary flood maps for Alabama and NW Florida are not scheduled for release until December of 2014. The new permanent maps will not be put into effect until 2015.
When you look at the facts you question how the NFIP/FEMA, with a program operating at a $24 billion deficit, can justify any premium reduction on these high risk properties then proceed with the implementation of sections 205 and 207 of Biggert Waters? Obviously FEMA officials and Congress expect innocent homeowners that followed FEMA’s rules to make up this deficit. Why doesn’t Congress or FEMA initiate an internal investigation and get to the bottom of this issue? Why don’t they delay the implementation of sections 205 and 207 until this investigation is complete? These condominium owners are receiving what appear to be extremely low unjustified flood rates at the expense of coastal homeowners around the entire country. No individual homeowner or small business owner should have flood premiums raised until Congress and FEMA get to the bottom of this issue.
If these politicians feel so strongly about the rates, why don’t they open their own flood insurance program with their OWN money and run it? Then they can keep the rates as low as they want. But as long as it’s using tax payer money to subsidize, then let the rate increases tax affect.
Agree, rates should increase but can you really be confident that a dysfunctional Gov’t agency made the correct rate calculations? $1000 increased to $10,000 doesn’t make sense.
we the people: shame on Congress……take their paychecks until resolved
we the people demand Congress paychecks be terminated until resolved!
We are so confused and bewildered that the government can allow this to happen. Ok so I agree sometimes the funding just runs out and programs have to be shut down, but my husband and I bought our investment property October, 2012… we moved to Florida 5 years ago, after reestablishing ourselves we did think it would be a good investment to purchase rental property… believe me it’s not much, a small 850 sq ft duplex, but we invested our life savings. No one at the time informed us that we had subsidized insurance, no one informed us that a bill had just been passed 3 months prior which was going to greatly affect us in our insurance. The realtor claims they knew nothing and it was only made public a couple months ago, the insurance agent makes claims on the same, as well as the banker and mortgage broker. When they approved us for a mortgage on the home they had to know the amount of insurance to be sure that we could afford the insurance and home. Of course everyone expects insurance to increase maybe 10% a year… but not tenfold. I can’t possibly imagine NO ONE knew… now our big life savings of 45000.00 might possibly be gone and the bank will be laughing. Is it true no one knew of this bill being passed in July 2012 till just now????
I certainly doubt the banks are laughing. They’ll be stuck with your property in a flood zone with no way to insure it or sell it. Same as you.
Kathy, I own a home in an area that got damaged by Sandy that did not have flood insurance. I was never old when my home was zoned into a flood zone in 2009 nor was I told of biggert waters. I got flooded in Sandy and I had to buy Flood insurance in November 2012 as part of condition of grant.
I most certainly would have bought flood insurance right before we were zoned into flood in 2008 to take advantage of grandfathering and at the very least bought flood insurance in June 2012. My rates would have been locked superlow. FEMA/NFIP basically announced new rates in September 2012. I know realtors selling houses in September 2012 who did not tell clients about this nor agents selling flood quotes in Summer 2012.
RE Agents get paid commission and represent buyers. Insurance agents get paid commission on annual cost of flood insurance. Guess what your insurance quardruples the agent commission quadruples. No one had any interest in telling you. Least of all fema/nfip they got the house from grandfathered subsidized to full risk when you bought it. It was in everyones interest but yours for you to know.
Something must be done with this Act, even Representative Waters the author of this Act regrets what she did. This Act with the increase will affect millions forcing them to leave their homes since they will not be able to afford the increases. I for one a retired individual who found the location of my home might be forced out. Not only will it affect homeowners throughout the country but in coastal area tourism because of the hotels having increases thereby passing the increases on to customers. It will hurt our economy when we are just starting to recover from a recession. I just can’t understand it, why not start a National Catastrophic fund requiring every homeowner to pay something like 25 dollars to cover any disasters within the country. We must stop this Biggert-Waters Act with these increases !!!!!!