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![Flood Insurance - National Flood Insurance Program](/peth04/20041102185207im_/http://fema.gov/graphics/nfip/bn_nfip.gif)
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Water Conservation Association Mid-Year
Technical Conference Speech by Jo Ann Howard June 10, 1999
INTRODUCTION - I would like to thank
Bill West and Dean Robbins for inviting me to join you today.
- Being
here on South Padre Island, with its wide ocean and rich shore life, brings back
memories of summers long ago.
- It reminds me how beautiful
and varied a place Texas is -- from Big Bend to the Big Thicket and the Red to
the Rio Grande.
- As a "temporarily displaced"
Texan, it gives me a dose of the beauty and hospitality that Texans are known
for.
FAGAN BOOK - Being
in "the water business" whether we are trying to conserve it
or prepare for too much of it -- we share a common interest in helping our citizens
prepare for periods of drought and flood.
- And they are
inevitable. As Brian Fagan points out is his new book, "Floods, Famines and
Emperors", anomalies in the climate have been disrupting weather patterns
throughout history, and taking their toll on civilizations.
- The
book was given to me when I spoke at a recent River Authority meeting in San Marcos.
I would recommend it to all in this field, as it puts what we do in a larger historical
context.
- Fagan plots major climatic events against historical
events and finds that those cultures that learn to adapt successfully are sustained.
He shows that climate shifts have been a major -- and hitherto unrecognized
force in history, claiming, for example, that El Nino-driven weather patterns
have brought on the collapse of dynasties in Egypt; caused historic famines in
India; and destroyed whole civilizations in Peru.
TEXAS FLOODING
- We here in Texas know that, while water may be an essential
part of our planets biosphere, it is possible to have too much of a good
thing!
- Texas is one of the highest risk states for flooding:
-- In the last 10 years, there have been 19 Presidentially-declared disasters
for weather events, costing FEMA almost $480 million. -- The three flooding
events of last fall alone Tropical Storms Charlie and Francis and the October/November
Floods destroyed or damaged almost 23,000 homes. -- These storms resulted
in the provision of over $168 million in disaster relief. The State of Texas and
local jurisdictions also spent substantial sums for emergency response and repair.
-- As could see from the news photos from Del Rio where there was little
insurance coverage -- the families of too many flood victims were torn apart because
they lost: -- a loved one; -- their home and personal
possessions, some of which can never be replaced; -- or their lifes
hopes and dreams. -- Unfortunately, these events will continue
to occur in Texas and elsewhere, with ever-mounting losses, for:
-- scientists expect more dramatic meteorological events, and -- the population
boom here in Texas, especially in Coastal areas, exposes more people and property
to the hazards. - These periods of
shortage and excess come and go. We have little control over that. But we do have
some control over how we prepare for and respond to them.
MAJOR
SHIFT IN EMERGENCY PREPAREDNESS AND FLOODPLAIN MANAGEMENT - We
are now celebrating the 30th Anniversary of the National Flood Insurance
Program. It has been a time to look back at what we have learned, how the field
of emergency management has changed, and look forward to the millennium.
- I
am fortunate to serve as Federal Insurance Administrator with James Lee Witt at
the helm of FEMA. Under his leadership, the Agency has changed from what was once
referred to as a "patient in triage" to, in the words of the Vice President,
"a model of effectiveness in serving the American people".
- It
is truly an exciting time for there has been a "sea change" in
how we are looking at flooding and other natural hazards.
- There
is a growing concern about the cost of natural disasters and what can be done
about it. A National Science Foundation-funded study recently estimated total
dollar losses from natural hazards during the past two decades to be $500 billion
over 80% of which resulted from climatic events.
- Although
this includes all natural hazards, whether they rise to the level of a "disaster",
it is a staggering figure!
- The U.S. Army Corps of Engineers
estimates that floods cost the nation an average of $5.1 billion in damage each
year.
- There is a growing consensus that:
-- Rather
than simply picking up the pieces after disasters, we can adopt policies to prevent
or "mitigate" damage beforehand. -- And that mitigating
damage from natural disasters can goes hand in hand with wise management of our
natural resources and economic and social resiliency. This is the concept of "sustainable
hazard mitigation". -- Structural approaches to flood control, so prevalent
in the past, building dams and levees and channelization, are giving way to non-structural
approaches such as buying out repeatedly flooded homes and returning floodplains
to their natural state. These non-structural approaches are now viewed as more
effective over the long term. -- There is a coming together of interests,
and a recognition that we can prevent people from becoming disaster victims and
protect our environment at the same time. -- It is this resiliency that Brian
Fagan found to have protected people throughout history from the vagaries of weather.
Successful civilizations were able to adapt to the natural changes. FEMAs
PROGRAMS - With that said as context, I would like
to highlight 5 major FEMA programs that assist those at risk of, or damaged by,
floods.
- Handout provides greater detail.
- The
first two are grant programs that contribute to flood mitigation:
-- The Flood
Mitigation Assistant Program, funded by policyholders premiums, designed
to reduce or eliminate the frequency and severity of NFIP claims. -- The Hazard
Mitigation Grant Program, which comes into play after a disaster in order to reduce
the risk of damage and loss in the NEXT one. - Together,
these programs are the main tools we have to deal with repetitive loss properties
one of the major challenges we face in the Flood Program.
- While
the Hazard Mitigation Grant Program may be used for all hazards, the Flood Mitigation
Assistance Program is specifically targeted at flooding since it is supported
by our policyholders premiums and is used to mitigate insurable structures.
- Although
the allocation of funds differs, the process of getting funds to the communities
is similar:
-- The State puts a plan in place, establishes funding priorities,
and provides technical assistance to applicants -- After applications are
received by communities, the State selects projects based on the plan and priorities,
and submits them to FEMA. -- FEMA reviews the proposed projects for eligibility,
cost-effectiveness and environmental requirements, and approves them. -- FEMA
transfers funds to the State for approved projects and oversees their completion.
- These programs are an investment in the future.
- They
are our principal vehicles to address repetitive losses one of the Agencys
top priorities.
- Repetitive loss properties represent a
small proportion of our properties about 80,000 out of 4 million
have accounted for a third of our losses. They drain the Flood Fund of about $200
million per year and increase the need for borrowing.
- The
State of Texas has the second highest number of repetitive loss properties in
the Nation, with 10% of the total.
- Many Texans experience
devastation time and time again. These grant programs give them a way out, voluntarily.
They have provided funding for elevation, acquisition, relocation and demolition
of 23,000 homes nationwide and 500 here in Texas.
- Our experience
has shown that dollars expended save at least $2 in reduce future disaster losses.
THE
NATIONAL FLOOD INSURANCE PROGRAM - There are about 316,000 policies
in force in Texas, with over $38 billion in coverage. This makes Texas the fourth
largest State in terms of policies -- behind Florida, California and Louisiana.
- The
average cost of a policy here in Texas is about $380.
- More
Texans need to protect themselves. Only 1/3 of structures in Special Flood Hazard
Areas are insured. And you dont have to be in a high risk area to need insurance;
about 25% of our claims come from low- to moderate- risk areas.
- To
make their citizens eligible to purchase the insurance, about 19,000 communities
Nation-wide and 976 communities in Texas participate in the program.
- Participating
communities agree to adopt and enforce a floodplain management ordinance to regulate
new development in flood hazard areas. In exchange, policyholders subsidize insurance
on existing buildings, built before flood hazards were known (so-called "Pre-FIRM"
buildings). Owners of new buildings, built after FEMA has identified the flood
hazards ("post-FIRM"), pay actuarial rates for insurance that fully
reflect the risk.
- Through the Community Rating System,
premium discounts are available to residents of communities that go beyond these
minimum floodplain management requirements.
- The program
depends on accurate mapping of flood hazards to support flood hazard determinations
and set insurance rates a continuing challenge!
- Maps
must be continually updated to reflect changed conditions and new areas that will
be undergoing development.
- The maps are aging 45%
are at least 10 years old, and 70% are 5 years or older.
-- For example, the
tremendous development in Texas within 60 miles of the Gulf Coast and along the
Rio Grande Valley as a result of NAFTA, and the subsidence that has occurred in
Harris County, are not fully and accurately reflected on the flood maps. --
They are not up to date with current in Geographic Information Systems (GIS) technology.
- FEMAs has a Map Modernization Initiative will use state-of-the-art
digital engineering, mapping, information technology to improve the accuracy and
utility of the maps.
- We dont have enough money to
do the job that needs to be done. Current rates of funding support updating only
2 3% of the map panels a year.
- To date, the costs
of flood mapping have been born by flood policyholders. We are looking for the
broader group of users to bear more of the costs in the future.
- We
hope to obtain more resources from Congress. While there is broad consensus that
something needs to be done about the maps, there is not yet consensus on how to
pay for it.
- In the meantime, partnership is key. We are
looking to work with community and State organizations to facilitate the conduct
of flood studies.
-- We have recently initiated a major re-study of Harris
County watersheds, using the latest in sensing technology (LIDAR), surveying technology
(GPS), and computer software (GIS). -- FEMA is also working closely with the
North Central Texas Council of Governments on a major initiative called "The
Common Vision" to revise the maps for Denton, Dallas and Terrence Counties.
- FEMA takes applications
by phone, with a single application used for all types of assistance.
-- Under
FEMAs temporary housing program, assistance is available for transient accommodations,
home repair and mortgage and rental assistance. -- After FEMA inspectors verify
the loss, temporary housing checks are sent to recipients within 7 10 business
days. - FEMA submits applications to the Small
Business Administration to determine if applicants qualify for home or business
loans.
-- If they do, and the applicant agrees, SBA processes the loan application,
prepares a loan agreement, and issues a check. - If
declined for a loan, individuals may qualify for an Individual Family Grant for
medical or funeral expenses, transportation, home repair, replacement of personal
property, or other serious needs caused by the disaster.
- The
average IFG grant is $2,500. IFG checks are sent out by the State, which administers
the program.
- We are trying to get people to accept greater
responsibility for insuring themselves against loss. The National Flood Insurance
Reform Act has given impetus to this by strengthening the "Mandatory Purchase
Requirement". It requires recipients of Federal disaster assistance in Special
Flood Hazard Areas to purchase and maintain flood insurance in order to qualify
for future assistance.
- To assist those who may not be able
to afford the insurance, a three-year Group Flood Insurance is purchased on behalf
of recipients of Individual and Family Assistance.
- Public
Assistance the final program I will discuss was redesigned by FEMA
last year to improve customer service and expedite assistance.
- It
provides for the repair of infrastructure and public facilities and emergency
measures to save lives and protect health, safety and property.
-- [Examples
are debris removal, emergency protective measures, and repair of road systems
and bridges, water control facilities, public buldings, utilities and parks and
recreational facilities.] - After the Presidential
declaration:
-- applicants submit a request to the State Division of Emergency
Management, which administers the program. -- A FEMA Public Assistance Coordinator
is assigned to manage the case. -- Applicants prepare Project Worksheets detailing
the work to be done and the cost. These Worksheets are validated by FEMA and/or
State officials. -- The worksheets are sent to FEMA by the State. -- FEMA
reviews and approves the Worksheets, and has the FEMA Regional Office in Denton
allocate funds to the State. - The State sub-grants
and transfers funds to the applicant, and oversee the project through to completion.
PROJECT IMPACT - No discussion
of FEMA programs would be complete without mentioning Project Impact.
- This
initiative is aimed at making the Nation disaster resistant one community at a
time.
- At the core of Project Impact are two concepts:
-- The first is preventing damage by building stronger, safer communities before
disaster strikes. -- The second is partnership. No community can successfully
become disaster resistant without everyone getting involved. Citizens, community
organizations, business and industry, all levels of government and the media all
are working together to make Harris County and other Project Impact communities
safer places to live. - We now have 118 Project
Impact communities and more than 680 corporate and business partners supporting
the approach.
- Harris County and the cities of Houston,
Bellaire and Webster (with about half of the States repetitive loss properties)
have recently been designated as a Project Impact community.
BLUE
RIBBON PANEL
- Good coordination enables us to deal with flood risks in a
comprehensive and integrated fashion, and better serve our customers.
- The
Legislature recognized this, passing Senate Concurrent Resolution No. 68 calling
for a Blue Ribbon Study to:
-- examine ways to improve coordination in mitigating
damage before, and providing damage assistance after, flooding and other natural
disasters; and, -- streamlining the provision of disaster assistance, including
the use of cost-effective technologies to facilitate service.
- The Resolution calls for involvement in the Study by each of
these agencies of State Government, with the LBJ School as a resource.
- We
look forward to the results of the Study. It should make a real difference not
only here in Texas, but nationwide.
CLOSING REMARKS
- These assistance programs are the principal vehicles by
which FEMA helps communities adapt -- to use Brian Fagans terminology
to the vagaries of the weather.
- We cant stop
the storm, but we can reduce the risk. Lets work together to fix it.
- For
more specific information on them, you are invited to visit our website at: WWW.FEMA.GOV/NFIP.
- You are
also invited to our next annual National Flood Conference in Austin, May 7
10, 2000. It will be an opportunity to learn more about the National Flood Insurance
Program, as well as have a great time!
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