NAHB Helps Soften the Impact of New Flood Risk Standards

In an important victory for NAHB and the housing community, the U.S. Army Corps of Engineers will pull in the reins on sweeping new standards that could have had a dramatic impact on home building and development.

NAHB talks with the Corps have produced results that will blunt the impact of the new Federal Flood Risk Management Standard, which greatly expand the 100-year floodplain, placing tighter limits on where homes can be built.

In January, President Obama issued an executive order establishing the new Federal Flood Risk Management Standard expanding the floodplain beyond the 100-year floodplain to either the climate-informed science floodplain,  the 500-year floodplain,  or the 100-year floodplain plus an additional 2 to 3 foot freeboard.

Given the language of the executive order, NAHB was concerned that the new floodplain definition could adversely affect residential housing projects and homes that get HUD funding, require EPA permits and participate in the National Flood Insurance Program (NFIP), making housing more expensive for consumers.

NAHB members and staff spoke in listening sessions, submitted comments and continually pushed federal agencies to limit the applicability of the new standard. These efforts worked.

• In June, FEMA confirmed that the new standard will not affect the standards or rates of the NFIP or the minimum floodplain management criteria for communities. FEMA will also continue to use the 1% annual chance floodplain as the basis for the Flood Insurance Rate Maps and the overall NFIP.
• This week, the Army Corps of Engineers released a fact sheet stating that Clean Water Act Section 404 wetland permits will not be subject to the expanded floodplain standard.
• Also this week, HUD confirmed to NAHB that the standard would not apply to newly constructed homes financed with FHA-insured mortgages. It had already determined that the standard would not apply to existing homes purchased with an FHA-insured mortgage.

However, the standard will apply to multifamily properties using FHA insurance for new construction or substantial rehabilitation. It will also apply to FHA 203(k) rehabilitation loans.

NAHB will continue to meet with the agencies as they update their regulations. We’ll monitor the development of the various documents and participate as needed to ensure our members’ concerns are addressed.

As a member of the HBA of Greenville, part of your dues go towards your NAHB membership so that they can continue to fight for fair regulations on your behalf.