BARRISTER'S BRIEFING: HUD Proposes ‘Resilience Standard’ To Protect Communities From Flooding

On Oct. 27 the U.S. Department of Housing and Urban Development proposed new elevation standards to be known as a “resilience standard” for all HUD-supported properties. These higher elevation standards specifically pertain to properties seeking HUD assistance or Federal Housing Administration (FHA) mortgage insurance.

The proposed rule from HUD would mandate that properties considered to be “non-critical” would be elevated two feet above the site’s “base flood elevation” (e.g. 100-year floodplain), a term often found in flood plain management. Properties deemed “critical” by HUD such as hospitals, police/fire facilities, and nursing homes would have to be elevated three feet above the site’s base flood elevation, or the 500-year floodplain, whichever is greater.

Not only is HUD proposing higher vertical elevation standards for its assisted and insured properties, but the federal agency is also seeking to enlarge the horizontal floodplain area around the site for certain types of federally-supported properties. In addition, the proposed regulation would also update HUD’s Minimum Property Standards for both public housing developments as well as single-family homes with mortgages insured through the Federal Housing Administration.

Specifically, the regulation would seek that that the lowest floor in both newly constructed and substantially improved structures located within the 100-year floodplain be built at least two feet about the base flood elevation, but would not consider the same issue as to horizontal flooding. Worthy of note is that elevation standards for manufactured (colloquially known as “pre-fab”) homes receiving mortgage insurance through the FHA are not covered in the proposed regulation.

HUD Secretary Julian Castro remarked regarding the proposed regulatory change, “Our nation is faced with mounting and compelling evidence that future flooding events will be increasingly costly and frequent. If we’re serious about protecting people and property from flooding, we have to think differently than we did 40 years ago. Today we begin the process of aligning our regulations with the evidence to make sure taxpayer dollars are invested in the most responsible and resilient manner possible.”

As an aside, licensees should be aware that homes and buildings in high-risk flood areas with mortgages from federally regulated or insured lenders must carry flood insurance. For homes and businesses situated in moderate- to low-risk areas that have mortgages from federally-regulated or insured lenders-flood insurance is usually not mandated.

Persons and businesses outside of mapped high-risk flood areas file more than 20% of all National Flood Insurance Program flood insurance claims. They also receive one-third of federal disaster assistance for flooding. If available, disaster assistance is typically a loan to be repaid with interest. A private mortgage lender can require flood insurance, even if it is not required by the federal government. If Licensees are seeking more information on the National Flood Insurance Program administered through the Federal Emergency Management Agency (FEMA), they may visit www.floodmart.gov.

Editor’s Note: The foregoing is for information purposes only and does not confer an attorney/client relationship. For a legal opinion or advice specific to your situation, please consult with a private attorney at law.

Leon Cameron, Esq.
Leon Cameron, Esq., is Director of Legal Services & Professional Standards Administrator for the Hudson Gateway Association of Realtors.