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Long-Awaited Details Arrive on Flood Risk Executive Order

Flood Risk

FEMA issued long-awaited guidance to federal agencies on Oct. 8 on how to implement President Obama’s executive order establishing a Federal Flood Risk Management Standard. The order will update existing building standards for federally funded projects, helping ensure that those projects are more resilient to potential flooding caused by climate change and rising sea levels. The parameters greatly expand the scope of the original order from 1977. Many argue that they have the potential to significantly increase the cost of construction and impact more areas and projects.

The implementation parameters leave many questions unanswered for the apartment housing industry. But we have received key pieces of information that are helpful:

  • The order will have no impact on the National Flood Insurance Program nor will it impact the cost or availability of federal flood insurance for policyholders;
  • Projects financed through Fannie Mae and Freddie Mac do not need to comply with the new standard; and
  • Permitting through the Army Corps of Engineers will not be impacted as it relates to Clean Water Act Section 404 wetland permits.

The executive order requires agencies like HUD to ensure projects they fund using federal dollars, such as Federal Housing Administration (FHA) multifamily properties, be built to meet one of three standards: the best available climate-informed science; the free board approach (that is, adding two or three feet of clearance above the base flood elevation of the 100-year floodplain); or the 500-year floodplain defined as areas that have a 0.2% annual chance of flooding. All the standards would provide for much higher requirements than currently exist. 


NAA/NMHC and our industry partners are monitoring this situation very closely because the prospective standards leave room for significant uncertainty and inconsistency. But we will have an opportunity to provide comments since HUD and other key federal agencies will now move forward with issuing their own standards.


Ultimately, the goal of our comments will be to help prevent disruption when it comes to FHA multifamily construction and rehabilitation, and programs like HOME and CDBG.


Provided by NMHC has part of the NAA/NMHC Joint Legislative Program