The


U.S.
Department
of
Housing
and
Urban
Development
(HUD)

announced
Monday
that
it
published
a
final
rule,
the
Federal
Flood
Risk
Management
Standard
(FFRMS),
in
the
Federal
Register.

The
rule
is
designed
to
“help
communities
prepare
for
and
reduce

flood
damage”
and
other
extended

climate
risks,
including
“heavy
storms,
increased
frequency
of
severe
weather
events
and
disasters,
changes
in
development
patterns,
and
erosion.”

Growing
impact
of
flooding,
natural
disasters

As
flooding
and
other
extreme
weather
events
have

impacted
more
people
across
the
U.S.
housing
ecosystem,
the
FFRMS
is
designed
to
address
these
increased
risks
to
protect
people
who
are
unprepared
for
the
resulting
“emotional
and
financial
burden
of
recovery,”
according
to
a
statement
from
HUD
acting
secretary
Adrianne
Todman.

“HUD’s
announcement
today
lessens
the
burden
these
disasters
have
on
people,”
she
said.
“As
climate
change
progresses,
flooding
disasters
will
continue
to
become
more
frequent,
more
severe,
and
more
costly
for
families
and
taxpayers.
This
final
rule
will
increase
awareness
for
renters
and
homeowners,
saving
lives
and
reducing
costs
for
years
to
come.”

The

final
rule
updates
two
key
HUD
regulations:
Part
55,
Floodplain
Management
and
Protection
of
Wetlands;
and
Part
200,
Minimum
Property
Standards.

“This
rule
strengthens
standards
by
increasing
elevations
and
flood
proofing
requirements
of
properties
in
areas
at
risk
of
flooding,
where
federal
funds
are
used
to
develop
or
provide
financing
for
new
construction
within
the
now
defined
FFRMS
floodplain,”
HUD
explained.
“It
also
applies
to
substantial
improvement
to
structures
financed
through
HUD
grants,
subsidy
programs,
and
applicable
multifamily
programs.”

The
minimum
property
standards
update
applies
only
to


Federal
Housing
Administration
(FHA)-insured
new
construction
within
the
100-year
floodplain,
the
announcement
explained.

More
accurate
information

Updating
flood
risk
standards
allows
communities
to
have
a
more
accurate
picture
of
the
risk
they
face,
according
to
a
statement
by
Marion
McFadden,
principal
deputy
assistant
secretary
for
community
planning
and
development
at
HUD.

“People
of
modest
means
are
more
likely
to
live
in
a
flood-prone
place
and
have
a
longer
time
recovering
when
disaster
strikes,”
she
said.
“This
rule
will
ensure
HUD
supported
properties
have
the
best
chance
of
being
undisturbed
when
flooding
occurs.”

HUD
estimates
that
about
10%
of
new
single-family
homes
financed
by
the
FHA
are
constructed
within
the
100-year
floodplain
each
year.

“The
updated
standard
reduces
FHA
homeowners’
exposure
to
losses
caused
by
flooding,
reduces
insurance
costs,
and
most
importantly
protects
the
risk
to
life
faced
in
areas
of
greater
flood
risk,”
the
announcement
stated.

It
went
on
to
cite
data
that
shows
flooding
is
“the
most
common
and
costly
weather-related
disaster
in
the
United
States
costing
taxpayers
billions
of
dollars
a
year
in
economic
losses,
health
impacts
and
funding
to
recover
damages
and
rebuild
or
repair
property.”

MBA
response

Mortgage
Bankers
Association
(MBA)
President
and
CEO

Bob
Broeksmit
said
that
the
organization
appreciates
the
intent
of
the
new
final
rule
but
maintains
misgivings
about
its
execution
and
potential
impacts.

“At
a
time
when
housing
markets
across
the
country
continue
to
suffer
from
weakening
affordability,
supply
shortages,
and
rising
property
insurance
costs,
we
are
disappointed
that
several
aspects
of
the
final
rule
will
slow
housing
production
and
ultimately
increase
costs
for
homeowners,
renters,
and
builders,”
Broeksmit
said
in
a
statement.

Expanding
floodplain
areas
while
adding
new
elevation
requirements
and
higher
levels
of
flood
insurance
could
make
FHA
financing
“more
expensive
and
less
competitive,
Broeksmit
said.
The
addition
of
climate-informed,
scientific-approach
tools
could
create
“inconsistencies”
due
to
a
lack
of
nationwide
maps,
he
added.

“We
will
continue
to
work
with
the
Biden
administration
on
policies
and
solutions
that
address
climate
risks
and
extreme
weather
impacts,
stressing
the
need
for
common
sense
approaches
that
do
not
curtail
housing
construction
and
negatively
impact
borrowers
and
renters,”
he
said.

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