President Trump’s Budget Eliminates Money for Flood Insurance Mapping

Higher Flood Insurance Rates and Unsafe Building Practices Will Result

Washington, D.C. – President Trump’s “Budget Blueprint to Make America Great Again” guts the National Flood Insurance Program’s (NFIP) mapping effort by proposing to eliminate “the discretionary appropriation for the NFIP’s Flood Hazard Mapping Program, a savings of $190 million, to instead explore other more effective and fair means of funding flood mapping efforts.”

“The maps are a critical aspect of the flood insurance program, the basis for both actuarial rates for each structure in a flood plain and for the implementation of land use policies to assure that unwise construction does not occur in high-risk flood plains,” said J. Robert Hunter, CFA’s Director of Insurance and former Administrator of the NFIP.

As to mitigation of risk, the loss of funding to create new maps will lead to either of two extremely undesirable outcomes:

  1. The maps will not be updated. As maps age they become more and more inaccurate, always on the low side because new construction fills the flood plain and water levels during a flood rise as a result.  Shortly after Hurricane Katrina, when FEMA issued 76 new maps in Jackson County, Mississippi (where the eye of the Hurricane came ashore), the average map being replaced was 20 years old and 10 feet too low.  The outdated maps led people to build homes they thought were safe but were not.  It also led people who thought they were living outside the high-risk area and a few feet above the old elevations to think that they were safe, so flood insurance was not purchased.  We know the devastation that old maps can cause.
  1. The flood insurance rates will be surcharged to pay for mapping. This is likely the only way to pay for mapping if the Budget does not pay for it.  The problem with this is that this will exacerbate the unaffordability problem that led to the pull back of many of the Biggart-Waters Act prices.  Rates are also already surcharged to try to reduce or hold off more deficits (already a whopping $24.6 billion).  Further, the affordability study FEMA was ordered to produce by Congress still has not appeared.  If affordability is a problem and the hope for repaying the debt is a vanishing, adding another layer of cost onto flood insurance buyers is problematic at best.

Flood-mapping provides important information about where development is safe and unsafe, whether flood insurance is needed or not and how to effectively price coverage from one community to the next. It is not a parochial need that can be paid for by those who buy flood insurance; it serves the whole country and should be supported in the federal budget.

CFA calls on Congress to reject this inappropriate provision of the proposed “Budget Blueprint to Make America Great Again” since it will only make American homes and businesses underwater again.

Contact: Bob Hunter, 703-528-0062

The Consumer Federation of America is an association of more than 250 non-profit consumer groups that, since 1968, has sought to advance the consumer interest through research, education, and advocacy.