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September 26, 2013

Murky floodplain rules sink development plans

  • Property owners are facing more restrictive floodplain development regulations, new floodplain maps that include more land, and hefty increases in flood insurance premiums.
    VanNess Feldman Gordon Derr


    Aconfluence of events is changing the floodplain landscape in the Puget Sound. Even absent significant flooding like that experienced in Colorado, New York and New Orleans in the past few years, floodplains have become an ever more important and complicated feature in the physical and regulatory landscape in the Puget Sound region.

    In prior years, floodplain effects were felt only by people living along one of the half dozen or so rivers in the region that flooded every few years. In the past 10 years, however, that has changed due to a confluence of virtually invisible events. The combination of updates to the FEMA floodplain maps, the development regulations applicable to floodplains, and the applicable insurance requirements have combined to change the landscape in ways that are as significant as a flood itself.

    FEMA’s floodplain maps

    Starting in the mid-2000s, the Federal Emergency Management Agency began a process of updating its flood insurance rate maps for communities in the Puget Sound region. Many of the existing floodplain maps had not been updated since the mid-1980s. The intent was to use more current data and methods to update the regions’ floodplain maps and make them available to everyone digitally on the Internet.

    As part of its effort to update the floodplain maps, FEMA asked local communities to demonstrate, for the first time since the inception of the National Flood Insurance Program in 1968, that the levees along many of their rivers were strong enough to withstand a 100-year flood (technically, a flood that has a 1 percent chance of occurring in any year).

    Most communities — in the Puget Sound region and around the country — were unable to provide the necessary documentation.

    As a result, in 2010, FEMA issued new preliminary floodplain maps for King County, which showed areas on the landward side of many levees as within the floodplain for the first time. This meant that much of the Lower Green River Valley — the industrial engine stretching through Tukwila, Kent and Auburn that serves as the distribution hub for the ports of Seattle and Tacoma — was shown within the floodplain.

    This caused strong reactions from the cities in the valley, as well as other cities around the country that faced similar results. They all were fearful of the economic impact of having key revenue-generating areas mapped into the floodplain.

    In response, communities around the country lobbied Congress to change the way FEMA analyzes levees when preparing floodplain maps. In February 2011, more than 25 U.S. Senators sent a letter to FEMA Director Craig Fugate asking to change the levee mapping procedure. Fugate responded by putting the floodplain map updates on hold pending development of a new procedure.

    Earlier this summer, FEMA issued the new levee mapping procedures, known as the Levee Analysis and Mapping Procedures. FEMA plans to test out the new procedure in 25 communities around the country (representing about 10 percent of the studies that have been on hold since March 2011) over the next year or two. Based on the results of those pilot studies, FEMA plans to refine the policy and then apply the final process to the remaining communities around the country.

    Earlier this month, a joint meeting was held by the King County Flood Control Zone District and FEMA Region X where FEMA explained the likely schedule for new maps in King County.

    Region X Mitigation Director Mark Carey explained that the new maps are not likely to be finalized in King County until spring/summer 2018 at the soonest. And while FEMA expects those new maps to be different than the preliminary floodplain maps issued in 2010, Carey was not able to reassure the 100-plus attendees that the new maps would necessarily show less area in the floodplain or lower base flood elevations than the 2010 maps. We will not know until the analysis is completed in the coming years.

    The city of Kent is working diligently to try to ensure that all of the levees along the Green River are reinforced before FEMA finalizes its new maps. That would enable FEMA to map the areas landward of the levees outside of the floodplain on the new maps. It remains a little murky, however, whether it will beat the deadline.

    Regulatory landscape

    Around the time FEMA began updating its floodplain maps in the Puget Sound region, the National Wildlife Federation sued FEMA Region X claiming that FEMA’s implementation of the National Flood Insurance Program (NFIP) in Washington was harming endangered salmon species. That lawsuit resulted in the National Marine Fisheries Service issuing a biological opinion under the Endangered Species Act that directed FEMA to change its standard minimum floodplain regulations to make it more difficult to develop floodplain areas.

    For property owners in a local community to be able to purchase flood insurance through the NFIP, the local government must adopt development standards at least as restrictive as FEMA’s minimum standards.

    Prior to the biological opinion, FEMA only required local governments to demonstrate that homes and businesses built in the floodplain were elevated above the flood elevation and made safe during a flood event. Since the opinion, FEMA has been attempting to require local governments to give much greater consideration to impacts to habitat; even in areas that have little or no habitat.

    While many of the provisions suggested in the biological opinion are fairly specific, the simplified summary is that FEMA has begun requiring local governments to prove that development projects in the floodplain will have “no adverse effect” on endangered salmon species or their habitat. This has resulted in FEMA sanctioning a few local communities who have issued permits for new or replacement bulkheads, and reviewing other approved permits more strictly.

    This change has raised the cost and difficulty of development — even in floodplain areas that are already developed or otherwise slated for commercial or residential development.

    Even with FEMA implementing these new more restrictive standards, the National Wildlife Federation again sued FEMA in the fall of 2011 asserting that these new standards are not restrictive enough and seeking to suspend the sale of NFIP flood insurance in the region until FEMA implements more even more restrictive regulations, such as 150- to 250-foot “no touch” buffers along Puget Sound and the region’s inland rivers.

    It is unclear how such restrictive standards would ever work with the region’s ports and other existing shoreline development. That litigation is still ongoing and a decision is not expected until sometime next year.

    Flood insurance

    Adding to the complexity and consequences of the current situation, Congress last year adopted the Biggert-Waters Flood Insurance Reform Act of 2012, which significantly changed the rules that apply to flood insurance sold through the National Flood Insurance Program. For decades, flood insurance through the program had been highly subsidized, particularly for properties constructed before its inception. In 2012 — with FEMA facing an $18 billion shortfall after Hurricane Katrina — Congress decided to eliminate nearly all flood insurance subsidies and phase out the grandfathering rules.

    As a result, stating this summer, property owners around the country have begun to see significant increases in their flood insurance premiums. Combined with the new flood insurance maps, it has been common for owners to receive insurance bills as much as four times, and in some cases closer to 10 times, higher than the rates paid just the year before. One company contacted me because its rates went from around $500 a year to more than $6,000 a year.

    With new floodplain maps having been issued in Louisiana after Katrina and for much of the Northeast after Hurricane Sandy, many property owners are crying foul and asking Congress to roll back insurance rates. But as of yet, Congress has not responded.

    Overall, the confluence of these events — new floodplain maps showing larger areas within the floodplain, new more restrictive floodplain development regulations, and new higher flood insurance premiums — are combining to significantly change the floodplain landscape in the Puget Sound.

    On a bright note, the Nature Conservancy has begun a new program in the Puget Sound region called Floodplain by Design, which leverages available federal, state and local funds and programs to create a more comprehensive approach to floodplains aimed at restoring important habitat areas (those typically flooded every one to five years), while also improving flood protection.

    More information can be found about Floodplain by Design on the Nature Conservancy’s web page: http://tinyurl.com/NCFBD.

    Molly Lawrence is a land-use attorney at VanNess Feldman Gordon Derr in Seattle. For the last five years, Lawrence has represented the nonprofit Property Owners for Sensible Floodplain Regulations, which is made up of local industry groups and private property owners interested in finding a balanced way to regulate floodplain development.

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