Appendix 2. NFIP CRS Biennial Report to Congress
1660-0022_Appendix 2_CRS_Biennial_Report_to_Congress.doc
Community Rating System (CRS) Program-Application Worksheets and Commentary
Appendix 2. NFIP CRS Biennial Report to Congress
OMB: 1660-0022
Report to Congress
On the National Flood Insurance Program’s -
Community Rating System
October 2004
National Flood Insurance Program
Community Rating System
Biennial Report to Congress
Executive Summary iii
Introduction 1
Part 1. CRS Facts and Figures 2
How the CRS Works 2
Participating Communities 5
Dollars and Cents 7
Part 2. Program Management 9
The Players 9
Program Activities 9
Program Improvement 10
Part 3. Progress Toward Goals 13
Support for Mitigation Programs 13
Class Improvement 15
Encouraging Participation 17
All-Hazards Planning 17
Conclusions 19
Executive Summary
The National Flood Insurance Program’s (NFIP) Community Rating System (CRS) is administered by the Department of Homeland Security’s Federal Emergency Management Agency (FEMA). The CRS was implemented in 1990 to recognize and encourage community floodplain management activities that exceed the minimum NFIP standards. The National Flood Insurance Reform Act of 1994 codified the Community Rating System in the NFIP. Under the CRS, flood insurance premium rates are adjusted to reflect the reduced flood risk resulting from community activities that meet the three goals of the CRS: (1) reduce flood losses; (2) facilitate accurate insurance rating; and (3) promote the awareness of flood insurance.
There are 10 CRS classes: Class 1 requires the most credit points and gives the largest premium reduction; Class 10 receives no premium reduction. The CRS recognizes 18 creditable activities, organized under four categories numbered 300 through 600: Public Information, Mapping and Regulations, Flood Damage Reduction, and Flood Preparedness.
As of October 1, 2004, there are 1006 communities receiving flood insurance premium discounts based on their implementation of local mitigation, outreach, and educational activities that go well beyond minimum NFIP requirements. Although premium discounts are one of the benefits of participation in the CRS, it is more important that these communities are carrying out activities that save lives and reduce property damage. These 1006 communities represent a significant portion of the nation’s flood risk as evidenced by the fact that they account for over 66% of the NFIP’s policy base. Communities receiving premium discounts through the CRS cover a full range of sizes from small to large, and a broad mixture of flood risks, including coastal and riverine.
The CRS was developed and implemented with the benefit of advice and effort by federal, state, and local officials; professionals with expertise in floodplain management and insurance; and academics. A multidisciplinary approach led to successful implementation of the program and this same approach has been employed in reviewing and refining the CRS over the last 12 years.
Part 1 of this report provides summary statistics on community participation in the CRS and on the costs of administering the program. Part 2 reviews how the CRS operates and how the program activities have been implemented. Part 3 describes progress toward the four strategic goals that were posed in prior reports.
The major highlights of this report are:
The 1006 participating CRS communities represent two-thirds of all flood insurance policies.
Participation in the CRS is well distributed across the country, although it is higher in Florida where policy counts are greater and in those states that are more active leaders in floodplain management.
In addition to the benefits of the CRS’s basic approach of encouraging and crediting floodplain management activities, the CRS also helps reduce disaster losses in a wide variety of ways, such as acting as a model for communities, supporting research into mitigation activities, emphasizing stronger multi-hazard building codes, and encouraging all-hazards planning.
The program has been steadily growing over the past five years and CRS communities are improving their floodplain management programs and receiving better CRS classifications in return.
The costs borne by communities in implementing activities credited under the CRS are justified by the reduction in losses to property and lives in the communities. These benefits accrue to all the residents, whether they have flood insurance or not. The CRS provides two important benefits: national recognition of local flood mitigation efforts, and premium reductions for those prudent enough to purchase flood insurance.
Introduction
This is the fifth biennial Report to Congress on the Federal Emergency Management Agency’s (FEMA’s) Community Rating System. It is submitted pursuant to Section 541(4) of the National Flood Insurance Reform Act of 1994 (the Riegle Community Development & Regulatory Improvement Act of 1994).
The previous Reports (1996, 1998, 2000, and 2002) contained extensive sections on the history of the Community Rating System (CRS), the role of the Community Rating System Task Force, how insurance premium credits are provided, the 18 floodplain management activities that the CRS recognizes, the evaluation of the CRS, and the resulting revisions in crediting and scoring activities.
This biennial report will review the main activities of the past two years, how the program has made refinements to the creditable activities and points, and how the program has fared in its efforts to accomplish its strategic goals. The report is in three parts:
Part 1 provides a summary of the CRS, its history, current statistics on community participation, and the costs and benefits of the program.
Part 2 addresses management issues, including routine operational activities and how the scoring system is monitored and improved.
Part 3 looks at progress toward four strategic goals:
Support FEMA’s pre-disaster mitigation emphases.
Encourage CRS communities to improve their classes.
Encourage the communities not in the CRS to join.
Encourage an all-hazards planning approach.
More details on the topics covered here are available from FEMA. Most of the publications referenced can be found at the Community Rating System Resource Center on FEMA’s website, http://training.fema.gov/emiweb/CRS/index.htm
Part 1. CRS Facts and Figures
How the CRS Works
Communities that regulate new development in their floodplains are able to join the National Flood Insurance Program (NFIP). In return, the NFIP provides federally backed flood insurance for properties in participating communities. Today over 20,000 communities are in the NFIP and there are over 4.4 million policies in effect.
The Community Rating System (CRS) is a part of the NFIP. The CRS reduces flood insurance premiums to reflect what a community does above and beyond the NFIP’s minimum standards for floodplain regulation. The objective of the CRS is to reward communities for what they are doing, as well as to provide an incentive for new flood protection activities.
In order to recognize community floodplain management activities in this insurance rating system, those activities must be described, measured, and evaluated. A community receives a CRS classification based upon the credit points it receives for its activities. The criteria for CRS classification, the application procedures, and the credit points and calculations used to determine and verify CRS credit are all contained in the CRS Coordinator’s Manual.
Community
Rating System
Premium
Discounts
Premium
Discount
1 45% 10% 2
40% 10% 3
35% 10% 4
30% 10% 5
25% 10% 6
20% 10% 7
15% 5% 8
10% 5% 9
5% 5% 10
0 0
*
Special Flood Hazard Area. Non-SFHA premium reductions apply to B,
C, D, X, A99, and AR Zones.
Class
SFHA* Non‑SFHA
Community application for the CRS is voluntary. Any community that is in full compliance with the rules and regulations of the NFIP may apply for a CRS classification better than Class 10. The applicant community submits documentation that it is doing activities recognized under the CRS. A community applies by sending completed application worksheets with appropriate documentation to its FEMA Regional Office.
A community’s CRS classification is assigned on the basis of a field verification of the activities described in its application.
Activities Credited. The CRS recognizes 18 creditable activities, organized under four categories numbered 300 through 600 (see table, next page). The credit points are based upon how well an activity meets the goals of the CRS. Formulas and adjustment factors are used to calculate credit points for each activity.
Communities that are affected by one or more of eight special hazards, such as coastal erosion, tsunamis, or ice jams, have the opportunity to earn additional credit under several activities. These credit criteria are explained in a separate publication, CRS Commentary Supplement for Special Hazards Credit.
Credit Points Awarded for CRS Activities
ACTIVITY |
MAXIMUM POSSIBLE POINTS |
AVERAGE POINTS EARNED |
MAXIMUM POINTS EARNED |
PERCENTAGE OF COMMUNITIES CREDITED |
300 Public Information Activities 310 Elevation Certificates 320 Map Information 330 Outreach Projects 340 Hazard Disclosure 350 Flood Protection Information 360 Flood Protection Assistance
400 Mapping & Regulatory Activities 410 Additional Flood Data 420 Open Space Preservation 430 Higher Regulatory Standards 440 Flood Data Maintenance 450 Stormwater Management
500 Flood Damage Reduction Activities 510 Floodplain Management Planning 520 Acquisition and Relocation 530 Flood Protection 540 Drainage System Maintenance
600 Flood Preparedness Activities 610 Flood Warning Program 620 Levee Safety 630 Dam Safety |
162 140 315 81 66 71
1,373 900 2,720 231 670
309 3,200 2,800 330
225 900 175 |
72 138 80 21 22 57
56 113 100 66 105
79 140 43 261
101 154 66 |
142 140 290 81 30 71
430 954 766 218 446
220 2,084 384 330
200 520 100 |
100% 96% 79% 54% 85% 42%
26% 86% 78% 68% 79%
14% 9% 5% 77%
29% 1% 91%
|
Year
1987 First
Community Rating Task Force appointed by Federal Insurance
Administrator.
1988 Insurance
Services Office tasked with a major role in developing the CRS.
First
Schedule
drafted, modeled on ISO’s community fire insurance rating
system.
1989 CRS
Commentary
expands on the Schedule.
Field tests conducted. “Weighting
Forum” sets basis for points and scoring system.
1990 FEMA
mails CRS announcement notice to all NFIP participating
communities. CRS
Coordinator’s Manual
published, combining the Schedule
and the Commentary
in one guidebook for the local official.
75
workshops held around the country. Week-long CRS courses begin
at FEMA’s Emergency Management Institute. Example
Plans,
first of the “model programs” series, is published
to provide more guidance on how communities can implement and
score their activities. NFIP/CRS
Update
initiated to provide periodic news, helpful hints to local
officials. 324
communities apply by December 15 deadline.
1991 First
verification visits conducted.
293
cities and counties become Class 9 CRS communities on October 1.
1992 1990
initial applicant communities’ verified classes take
effect on October 1; 280
of the 1991 applicants become Class 9.
1993 The
3- and 5-year cycle verification system is formalized.
1994 The
Short
Form Application
is published, providing a streamlined way for communities to
apply, evolving into the CRS
Application –
single application procedure. The
Schedule
includes
new credits for protecting natural and beneficial functions and
for coastal erosion programs. The
National Flood Insurance Reform Act codifies the CRS.
1995 FEMA
begins three-year evaluation of the CRS with a Call for Issues
and a survey of local CRS Coordinators.
1996 Revised
annual recertification format provides more information to help
communities implement their activities.
Single
annual deadline and self-certified Class 9 approach dropped.
Communities may apply at any time. Verified classifications take
effect on May 1 and October 1.
1998 Evaluation
continues with focus groups and surveys. “Weighting
Review Forum” held to tie the evaluation’s
conclusions to credit criteria and the scoring system.
1999 New
CRS
Coordinator’s Manual
reflects the conclusions of the evaluation. Major changes
include increased credit points for several activities,
classifications tied to the effectiveness of local building
codes, and more recognition of locally designed activities that
better meet local conditions.
2002 FEMA
publishes revised CRS
Coordinator’s Manual.
Major changes include new credit points for structural flood
control protects protecting existing development, encouraging
adoption of International Building Code series (IBC), promotion
of websites for risk communication, prohibiting/limiting coastal
enclosures, and recognizing officials who become Certified
Floodplain Managers (CFMs).
2003 FEMA
introduces new CRS Web Resource Center
2004 Developed
new CRS video to better explain and market the CRS.
Community Rating System Timeline
Major
Activity
Participating Communities
As of October 1, 2004, there are 1006 communities in the CRS. Their class distribution is shown in the chart to the right. It can be seen that over half of all CRS communities are Class 8 or better.
Tulsa, Oklahoma; King County, Washington; and Fort Collins, Colorado, are the three best-rated CRS communities in the nation. On October 1, 2002, Tulsa became the first Class 2 (40% premium discount), while King County and Fort Collins remain the only Class 4 communities (30% premium discount).
There are over 20,000 communities in the NFIP. The 1006 CRS-participating communities represent 5% of all NFIP communities. However, these cities and counties account for over 66% of all flood insurance policyholders. CRS communities have the bulk of the nation’s flood challenges.
Distribution by State. Distribution of participation is shown on the next page. Participating communities are well distributed across the country. Participation is particularly high in Florida, which has more flood insurance policies than any other state and a high level of awareness of its exposure to flooding. Relatively high participation rates in Florida, North Carolina, California, New Jersey, and Colorado are also due to active state programs that help promote the CRS.
Readers can also see how the state’s community scores compare to the national averages (see example graph at right). This helps identify state training needs, etc.
CRS Participation by FEMA Region and State
Region I
CT 9
ME 20
MA 13
NH 4
RI 4
VT 3
53
Region II
NJ 44
NY 27
71
Region III
DE 7
MD 6
PA 13
VA 16
WV 1
43
Region IV
AL 13
FL 209
GA 24
KY 16
MS 19
NC 75
SC 30
TN 7
393
Region V
IL 28
IN 16
MI 15
MN 3
OH 13
WI 11
86
Region VI
AR 12
LA 35
NM 10
OK 11
TX 42
110
Region VII
IA 2
KS 4
MO 2
NE 2
10
Region VIII
CO 42
MT 12
ND 1
SD 1
UT 10
WY 5
71
Region IX
AZ 25
CA 61
HI 1
NV 8
95
Region X
AK 3
ID 19
OR 27
WA 25
74
Dollars and Cents
Administrative Costs. The annual costs for implementing the CRS program, like all other administrative expenses of the NFIP, are funded from policyholder premiums. The costs fall into two categories: staff resources and operating costs.
The staffing category covers the investment of time by state, federal, and associated Task Force staff involved in direct program management and implementation of the CRS. That time is summarized into an average annual total cost of $720,000, for 11.4 FTEs.
The total contracted operating costs are $3.6 million annually and include office and field review of all community applications, program oversight and quality control, preparing and printing various CRS publications, and other miscellaneous program costs. Other direct FEMA operating expenses are about $505,000 and include program travel, subsidizing community and state participation at three annual CRS classes at FEMA’s Emergency Management Institute; printing the CRS Application and Coordinator’s Manual, and other miscellaneous costs.
The total staffing and operating costs for administering the CRS program are currently estimated to be over $4.8 million for the 2004 calendar year.
Insurance and Mitigation Savings and Benefits. The CRS strategy has been twofold: to recognize floodplain management and insurance activities that meaningfully distinguish one class of community from another; and to act as a catalyst to encourage communities to initiate new activities. Since 1990, 50% of all CRS communities have improved their CRS classes (see graph on page 16), indicating that more flood loss reduction activities are being undertaken. Since 1996, there has been a steady increase in the number of communities in the better CRS classes. In that year, 32% of CRS communities were Class 8 or better; in the year 2000, over 50% were so classified; and today, over 68% of the CRS communities are rated Class 8 or better. Over the long term, this increases the benefits of the CRS and justifies the added administrative expense of having these classifications in the flood insurance rating system.
Further, the CRS has become an important tool for mitigation as well as a mechanism for integrating mitigation with insurance. This is consistent not only with grading systems that have been successfully employed for many years in the insurance industry, but also with new industry initiatives for relating insurance premiums to community efforts to reduce losses from natural hazards. In addition, a community that implements these mitigation activities provides benefits to all its residents—insured or not—and thereby reduces the need for taxpayer-funded flood response and recovery efforts. The overwhelming responses from various surveys of local officials and floodplain residents indicate that the CRS is a strong catalyst for communities to undertake new activities. And, we have calculated that the loss reduction value of only 60 CRS points per community associated with new activities more than offsets the federal expenses of the CRS.
The costs borne by communities in implementing activities credited under the CRS are justified by the reduction in losses to property and lives in the communities. These benefits accrue to all the residents, whether they have flood insurance or not. The full costs and benefits of undertaking activities can only be assessed by the individual communities. The CRS provides a partial benefit in two ways: national recognition of local flood mitigation efforts, and premium reduc-
tions for those prudent enough to purchase flood insurance. The latter benefit totals over $ 140 million annually in what policyholders pay for purchasing coverage in the 1006 participating CRS communities, compared to what they would pay in non-CRS communities.
Taken together, the above results provide evidence that the federal and community costs of implementing the CRS are more than justified by the benefits being obtained.
The best way to view the benefits of the CRS is to list how they impact communities and FEMA. Community benefits include:
The activities credited by the CRS result in enhanced public safety, a reduction in damage to property and public infrastructure, the avoidance of economic disruption and losses, reduced human suffering, and protection of the environment.
A community can evaluate the effectiveness of its flood program against a nationally recognized benchmark.
Residents save on flood insurance premiums.
Technical assistance in designing and implementing some activities is available.
A CRS community’s flood program benefits from having an added incentive to maintain its flood mitigation programs over the years. The fact that the community’s CRS status could be affected by the elimination of a flood-related activity or weakening of the regulatory requirements for new development should be taken into account by the local governing body when considering such actions. A similar system used in fire insurance rating has strongly affected local government support for fire protection programs.
Communities that participate in the CRS find that their floodplain management activities are better organized and more formalized. They are administered better and remain in operation after personnel changes.
Implementing some CRS activities, such as floodplain management planning, can help a community qualify for certain federal assistance programs.
FEMA and the federal taxpayers benefit from the CRS in several ways, too. These include:
Credited floodplain management activities have been shown to reduce flood losses and, therefore, flood insurance claims, disaster assistance payments, lost tax revenue, etc.
Communities publicize flood insurance and help insurance agents get rating information.
Loss reduction activities benefit all residents, insured or not. Flood insurance policy holders are the catalyst for community-wide programs that help everyone.
The CRS has been a sort of laboratory, providing data to FEMA on different ways to implement floodplain management activities. New initiatives by FEMA can be based on how communities have tried them on their own, as measured by CRS credits.
Part 2. Program Management
The Players
Task Force Membership
1
– Chair: retired insurance executive
6
– FEMA, Mitigation Division
3
– FEMA, Regional Offices
2
– Insurance industry
1
– Association of State Floodplain Managers
1
– National Emergency Management Association
1
– National Association of Flood and Stormwater
Management
Agencies
2
– Local community CRS Coordinators
1
– National Oceanic and Atmospheric
Administration
Task Force. Because of the many disciplines required to develop and monitor the CRS, FEMA created the Community Rating System Task Force. Its members bring together the fields of actuarial science, engineering, floodplain management, insurance underwriting, and property insurance inspection and rating services.
The Task Force is the focal point for all discussions about the CRS and the primary advisor to FEMA on the program. Key FEMA staff are also Task Force members.
Insurance Companies. The companies that write flood insurance policies are responsible for explaining the CRS and its benefits to its policyholders. Their representatives on the Task Force ensure that the program’s insurance aspects are manageable and provide a business perspective to operational issues.
Insurance Services Office, Inc. ISO has an arrangement with FEMA and insurance companies to process applications and provide technical assistance to FEMA, states, and communities.
States and Communities. These players implement the activities credited by the CRS. Most of the activities are undertaken by local governments. However, communities can receive credit for activities implemented at the state, county, or regional level. It is estimated that 10%–20% of the credited activities are implemented by a state or regional agency or because of a state or regional mandate. State and regional agencies also provide technical assistance to communities.
Program Activities
Here is a list of the activities undertaken during 2003. This list demonstrates the number and breadth of projects implemented pursuant to administering the CRS.
Community Review.
Reviewed 20 new community applications and conducted verification visits.
Reviewed 15 modifications to existing community programs, including verification visits.
Conducted 136 cycle verification visits (each community is reviewed every 3/5 years).
Publications and Software.
P
Technical Assistance Publications
CRS technical assistance publications, known as “model programs,” cover the following topics:
Floodplain management planning
Higher regulatory standards
Dam failure response planning.
Drainage system maintenance
Flood Warning programs
Outreach projects
Stormwater management
CRS record-keeping
Other technical publications cover the mapping and management of areas subject to special hazards:
CRS Credit for Protecting Coastal Dunes and Beaches
CRS Credit for Management of Coastal Erosion Hazards.
Developed or updated and printed technical assistance publications (see box).
Released updated PC software, “Computerized Calculations for the Community Rating System” and “Elevation Certificates.”
Published NFIP/CRS Update newsletter.
Community Training.
Conducted or made presentations at 37 local, state, or national workshops.
Conducted two week-long training courses at the Emergency Management Institute.
Conducted two all-day floodplain management planning workshops.
Community Outreach.
Distributed thousands of color brochures, The National Flood Insurance Program’s Community Rating System.
Displayed a CRS booth at three national conferences of professional associations.
Made presentations at five conferences of professional associations.
Introduced a new CRS website, which includes all CRS publications, guidance, tools, and samples to help communities apply to the CRS or improve their classifications.
Program Improvement
The Process. The CRS has a system to continually analyze, clarify, and improve its credit criteria, scoring, and operations. Valuable feedback on needed changes and improvements is obtained through:
Feedback from communities at workshops, meetings, and verification visits;
Feedback from states and FEMA regional staff;
Questionnaires and draft policy papers that are circulated for comment; and
“Calls for Issues” periodically sent out by FEMA.
A variety of concerns and suggestions are derived from these sources. CRS staff prepare memos, issue papers, and draft responses, which are sent to the Task Force for consideration at one of the three meetings it holds each year. The Task Force members, especially those who represent local, state, and FEMA Regional Offices, have their own direct sources of information.
The Task Force meetings are rotated among the ten FEMA regions in order to obtain input from experienced field personnel from different parts of the country. Each Task Force meeting is attended by representatives of the host FEMA Regional Office. Local officials and CRS Coordinators from communities in the area are invited to provide their comments on the program.
The in-stream changes that result from this ongoing process have varied from adjusting the points of an individual element in the grading schedule to major changes in the CRS Coordinator’s Manual. All of the landmark changes listed in the CRS Timeline (see page 4) were developed through this process.
The Results. The CRS Task Force is reviewing changes to the 2002 CRS Coordinator’s Manual. Specific changes to the 2005 Manual will include:
Increased recognition for community actions that address the NFIP’s repetitive loss properties such as acquisition, elevation, or relocation; properties outside the special flood hazard areas now receive credit, and those within the floodplain receive double credit;
As part of FEMA’s Map Modernization initiative, under Section 410, there will be a major update of how the CRS encourages and recognizes Cooperating Technical Partners (community, state, and regional agency efforts to keep their flood risk mapping up to date);
Revisions to website credit under Activity 350 (Flood Protection Information) for community websites to reflect changes in technology and increased use of the internet to better communicate flood & all-hazard risks;
Revisions to Activity 410 (Additional Flood Data) to incorporate Map Modernization initiatives;
Revisions to Activity 540 (Drainage System Maintenance) to clarify how a community’s drainage system is mapped and how to properly credit community efforts on private property and other sensitive areas not in public ownership;
Revisions to Activity 510 (Floodplain Management Planning) to clarify and identify linkages with Pre-Disaster Mitigation Planning;
Incorporation of “all hazards mitigation” approaches into applicable parts of the Schedule;
Increased credits for activities in applicable parts of the CRS for activities that reduce repetitive flood losses;
R
The CRS recognizes local websites that provide flood risk communication.
evisions to credits for managing special flood-related hazards, such as tsunamis and coastal erosion;Simplification of the documentation that communities must provide;
Promotion of all hazard risk management by promoting community adoption of the International Building Code series (IBC);
Encouragement for communities to recognize unmapped coastal hazards by extending V-Zone requirements into coastal A Zones and for limiting or prohibiting enclosures below BFE in these areas;
Continued support for the recently established floodplain manager certification program (CFM) and increased the credit points for staff training;
CRS floodplain management planning criteria have been changed to better meet the planning requirements of the Disaster Mitigation Act, allowing communities to adopt one plan for multiple FEMA programs; and
The scoring has been revised to encourage better local dam safety programs.
Outreach and Technical Assistance. Some improvements made since the last Report included the following:
Promoted separate brochures explaining the CRS to residents, community officials, and elected officials;
Introduced the CRS Web Resource Center, resulting from community responses to a needs assessment asking what CRS communities want for training;
Produced a new CRS video that features three CRS communities telling their success stories to better explain and market the CRS; and
Continued implementation of the previously mentioned State Profiles.
Part 3. Progress Toward Goals
Past CRS Reports to Congress identified four “overall and strategic issues.” The reports recommended that the following be “pursued in future years.”
Supporting FEMA’s all hazard pre-disaster mitigation emphasis.
Encouraging officials of communities already in the CRS to engage in activities that will improve their CRS class, thereby increasing protection for the lives and property of their citizens.
Encouraging the local officials of communities not in the CRS to join.
Encouraging local officials to use an all-hazards planning approach.
This part reviews the progress made toward these four goals since the 2002 Report to Congress.
Support for Mitigation Programs through FEMA’s Pre-Disaster Emphasis
FEMA helps communities protect themselves from the devastating effects of natural disasters by taking actions that dramatically reduce disruption and loss. The CRS has served as a model for all-hazards pre-disaster activities. Several local officials have reported that the CRS was their blueprint for organizing their program to build a more disaster-resistant community.
In addition, the CRS provides a financial and political incentive to undertake mitigation activities. CRS mitigation activity numbers and their measures include:
320, 410, 440—Developing and/or providing accurate hazard information;
330, 360—Advising people on mitigation measures they can take to protect their properties;
420, 450—Preserving hazardous areas as open space;
430—Enacting and enforcing higher regulatory standards for new development;
510—Preparing and adopting comprehensive mitigation/floodplain management plans;
520—Acquiring and relocating floodprone buildings;
530—Protecting existing floodprone buildings; and
540—Maintaining drainage systems to prevent flooding from debris jams and obstructions.
Often communities initiate such mitigation activities either because the CRS provides an incentive or because the CRS provides information and guidance on how to do them (or both). There are many examples of such success.
The CRS has taken the following specific actions to promote all-hazards mitigation:
Communities cannot become better than a CRS Class 8 unless they have an up-to-date, all-hazards building code and an enforcement program recognized by the Building Code Effectiveness Grading Schedule (BCEGS).
There are additional credits and prerequisites for higher CRS classes based on the community’s BCEGS class.
The Land Development Regulations component encourages communities to treat flooding as one of several hazards that they must mitigate to safely guide wise development decisions.
Local dam safety programs are emphasized through increased points in the 2002 CRS Coordinator’s Manual.
There are now more credits for programs that deal with flood-related hazards, such as coastal erosion.
The Additional Map Data component credits community Geographic Information Systems and the like to manage flood and other hazards within their community.
Building Codes. Building codes ensure the health and safety of citizens in the built environment. It has been FEMA’s experience, in responding to disasters of all types in all parts of the country, that communities with adequate codes and adequate code enforcement have survived far better and recovered far more quickly than communities without adequate building codes. With the rise of disaster costs in the United States, communities cannot afford to continue business as usual when it is within their power to be more disaster resistant. The cornerstone of mitigation is community adoption and enforcement of strong building codes.
For these reasons, FEMA fully supports building codes such as the model International Code Series (I-Codes) that address most natural hazards on a consistent, rational basis that allows mitigation of the effects of those natural hazards that are found within each jurisdiction’s boundaries. Because of these advantages, the CRS program encourages community adoption of the I-Codes (or like codes) through provision of increased credit points (Activity 430).
However, adoption of building codes is not enough. The CRS has also tied credits to updating and enforcing a building code. The CRS relies on ISO to provide community classifications under the insurance industry’s BCEGS program. The better the BCEGS class, the more CRS points (Activity 430).
Further, a community cannot progress beyond a CRS Class 8 without a good BCEGS class or beyond a CRS Class 5 without a better one. This has encouraged several communities to improve their building codes and enforcement so they can improve their CRS classes.
Mitigation Research. The CRS provides a wealth of information on the communities with flood problems and the floodplain management activities they are implementing to reduce those problems. The data and local materials collected have helped many research projects. For example, staff provided copies of local plans and technical review for a recent University of North Carolina study on the impact of state and local mitigation plans.
After Hurricanes Bertha, Fran, and Floyd, the effectiveness of CRS-credited mitigation activities was evaluated in an effort to measure the dollar benefits of certain mitigation measures. One study demonstrated that a 1986 state building code change that required deeper pilings on the coast resulted in “an overall reduction in damage as a percent of the [building’s] value from 37% to 15%.” The higher code standard was credited under the section in Activity 430 (Higher Regulatory Standards) on special hazards.
Another report measured the benefit of preserving floodplains as parkland (Activity 420, Open Space Preservation). Damage to parks in two North Carolina cities was compared to the damage suffered in neighboring developed areas. “The average damage prevented by preserving 86.4 acres as open space in three City parks in the flood fringe areas of the Tar River in Rocky Mount is estimated at about $4.1 million, or about $47,500 per acre. . . . In Wilson, the open space preserved in 50.5 acres in two City parks prevented an estimated $5.6 million in damage. This is an average savings of more than $111,000 per acre.”
Repetitive Losses. Repetitively flooded properties make up 1% of the NFIP policies but account for over 30% of the claims payments. Repetitive losses have been a priority for existing FEMA efforts for years, but the programs did not have the ability to mitigate enough properties to reverse the trend. However, Congress now has passed the Bunning-Bereuter-Blumenauer Flood Insurance Reform Act of 2004, which has created expanded program authority and grants to make significant inroads to reducing repetitive loss structures through individual and community projects that acquire, relocate, elevate, or floodproof these repeatedly flooded properties.
The CRS currently helps these efforts in two ways. First, every CRS community must research its repetitive losses, identify the causes of the problem(s), and distribute flood protection information to property owners in repetitive loss areas. The CRS-managed Repetitive Loss Update Center refines the database by working with communities who provide additional mitigation information on each property, thereby helping FEMA get a better handle on the extent of the problem.
The second way the CRS supports FEMA’s efforts to reduce repetitive losses is through the mitigation measures that communities undertake for CRS credit. For instance, repetitive loss properties acquired, retrofitted, or relocated outside the special flood hazard areas now receive credit, and those within the floodplain receive double credit.
Supported by the passage of the 2004 Reform Act, the CRS Task Force is reviewing various recommendations for new activities and enhancements to existing ones, to further encourage communities to mitigate these repetitively flooded properties.
Class Improvement
The second strategic issue posed in the last Report to Congress dealt with “encouraging officials of communities already in the CRS to engage in activities that will improve their CRS class.” As noted in the issue statement (“thereby increasing protection for the lives and property of their citizens”), the better the class, the more the community is doing to reduce flood losses and accomplish the other goals of the CRS.
Class Improvement Activities. We are doing many things to encourage and assist communities to improve their programs and apply for the additional CRS credit. Over the last two years, these have included:
Continuing to simplify the documentation needed and removing other impediments to applying for additional credits;
Preparing new and updating existing publications on various floodplain management activities;
Putting many publications on FEMA’s website where they are readily accessible;
Conducting training programs at the Emergency Management Institute and field-deployed locations;
Providing more guidance and assistance to local officials during community verification visits;
Publicizing CRS communities’ success stories and placing them in the new CRS Video and in a periodic newsletter to communities;
Encouraging communities to improve their staff capabilities and breadth of interest through the floodplain manager certification program; and
Linking CRS credit to initiation of other new mitigation programs, including StormReady, the BCEGS and the International Codes Series.
Results. As a result of this work (and the basic desire by communities to do better), there has been a steady improvement in community classifications. A pattern has been seen—first a community does just enough to join as a Class 9. Then during verification visits, help is provided to local officials to show them how they could start new activities or modify existing ones. The local officials receive newsletters, publications, and other information or attend workshops on CRS activities and they become motivated to do more.
CRS
Classes over Time
This pattern is shown in the chart. Over the last 12 years, the number of “entry-level” (Class 9) CRS communities has decreased and more and more communities have moved up to the better classifications. Although it is too small to show up on the graph, the CRS awarded its first Class 2 to Tulsa, Oklahoma, in 2002.
Encouraging Participation
The third strategic goal set forth in the last Report to Congress is to get more communities into the CRS. This goal is not just to increase the numbers. As noted in the previous section, once they are in, there is a propensity for communities to work toward improving their floodplain management programs.
CRS participation increased greatly during the first five years of the program when the most active communities applied. Then, growth leveled off from 1996 to 1999, when communities received their first “cycle” visit leading to a number of communities dropping out voluntarily or being removed because they no longer met the program requirements. However, various marketing and technical assistance efforts have resulted in moderate growth in the CRS since 1999.
Participation Activities. As with class improvement, FEMA and its partners are doing many things to encourage and assist communities to both join and remain in the CRS. Because of these efforts, total participation increased by 47 communities since 2002. Annual increases have doubled from 10 per year to more than 20. Over the last two years, activities to encourage more participation have included:
Simplifying the documentation needed and removing other impediments to applying;
Providing color brochures that explain the CRS to non-participants;
Putting CRS information and publications on FEMA’s website;
Conducting training programs on applying to the CRS;
Making presentations about the CRS at local officials’ workshops;
Experimenting with new approaches for state officials and others to complete the applications for smaller communities;
Promoting uniform minimum credit and master applications in states and counties that administer their own programs with higher standards, and
Including articles on the benefits of the CRS in newsletters of professional organizations and local officials’ associations;
Showing the CRS video containing community success stories.
All-Hazards Planning
The fourth strategic goal for 2002 was to encourage local officials to use an all-hazards approach to planning and mitigation.
The primary purpose of all-hazards mitigation planning is to identify community policies, actions, and tools for implementation over the long term that will result in a reduction in both the level of risk and the potential for future losses community-wide. All-hazard mitigation planning is most successful when it increases public and political support for mitigation programs, results in actions that also support other important community goals and objectives, and influences the community’s or state’s decision making to include hazard reduction considerations.
The planning process can support a sustainable planning effort by assuring that land use planning and development regulations guide development in directions that facilitate many goals simultaneously. Sustainable development principles, therefore, can provide a framework within which state and local governments can link mitigation to other goals. For example, sustainable communities often emphasize open space planning by promoting greenways, parks, and landscaping. Effective use of open space can prevent development from encroaching into floodplains, active fault zones, landslide areas, and other disaster-prone areas.
The CRS is particularly helpful in doing this, because it encourages communities to tackle their problems in a variety of ways, including developing comprehensive flood hazard mitigation plans. Once local officials have their flood mitigation activities in operation, it is easy to start addressing other hazards with the same people and programs. This approach has been followed in many communities, CRS and non-CRS alike. Local officials report that the CRS planning guidance and the program in general gave them ideas about where to start and how to organize their mitigation programs.
FEMA Regional Offices and several states have used the CRS planning guidance to help develop the mitigation plans required for disaster assistance funds, even for non-flood disasters. The U.S. Army Corps of Engineers now requires a floodplain management plan as a condition of flood control assistance and has noted that CRS-approved plans would qualify.
Last, the CRS floodplain management planning criteria has been updated to meet the planning requirements of the Disaster Mitigation Act of 2000, allowing communities to adopt one plan for multiple FEMA (and other federal agency) programs. There are continuous efforts to review the lessons learned from the various FEMA planning programs, including the CRS, and revise and coordinate their criteria. As a result, national guidance and model programs encourage “one plan does it all.” More and more communities are developing plans that receive CRS credit and qualify them for FEMA mitigation funds and Corps of Engineers’ projects.
We are also seeing many communities initiate all-hazard mitigation plans because of the FEMA requirements. During their planning processes, they discover the true extent of their flooding problems, learn about the CRS, and begin reducing their repetitive losses.
Conclusions
The CRS has made significant progress toward meeting the four strategic goals set out in the 2002 Report to Congress. Communities that have applied for classification under the CRS are achieving higher classes, indicating that more of the sophisticated flood loss reduction activities are being undertaken. Over the long term, this will increase the benefits of the CRS and justify the added expense of these classifications in the flood insurance rating system. The CRS has become an important tool for mitigation as well as a mechanism for integrating mitigation with insurance. This is consistent not only with grading systems that have been successfully employed for many years in the insurance industry, but also with new industry initiatives for relating insurance premiums to local community efforts to reduce losses due to natural hazards.
A key component of the FEMA Mitigation Division’s mission is to lead national efforts to encourage all-hazards risk management and to recognize those types of activities with regard to natural hazards in insurance rating systems. We promote a multi-hazard approach at the local level that leads to reduced losses by building disaster-resistant communities. Adoption and enforcement of strong building codes as measured by the insurance industry’s Building Code Effectiveness Grading Schedule integrates local community building code enforcement into the industry’s premium rates. The CRS of the NFIP is an important component of this trend in mitigation.
This report has provided an overview of how the CRS operates, where it stands now, and how well it is progressing toward its goals. The main findings can be summarized as follows:
The 1006 participating CRS communities represent two-thirds of all flood insurance policies.
Participation in the CRS is well distributed across the country. It is higher in Florida, North Carolina, California, and other states where policy counts are greater and in those states that are more active leaders in floodplain management.
In addition to the benefits of the CRS’s basic approach of encouraging and crediting floodplain management activities, the CRS also helps reduce disaster losses in a wide variety of ways, such as acting as a model for FEMA’s all-hazards risk approach for communities, supporting research into mitigation activities, emphasizing stronger multi-hazard building codes, and encouraging all-hazards planning.
The program has been steadily growing over the past five years and CRS communities are improving their floodplain management programs and receiving better CRS classifications in return.
The costs borne by communities in implementing activities credited under the CRS are justified by the reduction in losses to property and lives in the communities. These benefits accrue to all the residents, whether they have flood insurance or not. The CRS provides two important benefits to communities: national recognition of their flood mitigation efforts, and premium reductions for those prudent enough to purchase flood insurance.
The following strategies will be implemented by FEMA to guide the CRS until the next biennial Report to Congress:
The CRS will continue to be closely coordinated with and be mutually supportive of FEMA’s all-hazards risk management strategy.
Efforts to promote the benefits of joining the CRS will be continued.
CRS communities will continue to be assisted and encouraged to improve their floodplain management programs and thereby receive better CRS classifications.
Revisions to CRS policy as published in the CRS Coordinator’s Manual will be considered for the 2005 edition, to continue to refine the CRS and meet the above-mentioned strategies, in addition to any new ones on the horizon.
| File Type | application/msword |
| File Title | Naitonal Flood Insurance Program |
| Author | Bret Gates |
| Last Modified By | clim |
| File Modified | 2007-05-11 |
| File Created | 2007-05-11 |
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