RisQ Issues Public Comment on FEMA Notice

WASHINGTON, July 28 -- risQ Inc., Boston, Massachusetts, has issued a public comment on the Federal Emergency Management Agency notice entitled "Request for Information on FEMA Programs, Regulations, and Policies". The comment was posted on July 21, 2021:

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The executive summary points from a full publication can be found below. The full publication can be found here: https://risq-inc.medium.com/economic-and-racial-inequality-in-fema-sfha-flood-zone-designations-450b3019a78d - ~76% of Single-Family Residential flood risk in the US is not covered by the FEMA Special Flood Hazard Assessment (SFHA) 100-year flood zones that are also used to determine residential flood insurance requirements for government-backed home loans.

- Populations that spend the most relative income on housing are ~1.5x more likely than the least housing cost-burdened to be exposed to flood risk not covered by FEMA SFHAs. SFHAs in their current form are financially regressive with respect to flood risk and resilience.

- Even after accounting for housing cost-burden, non-white populations are significantly more likely to face flood risk that is not captured in FEMA SFHAs -- at every level of flood risk. Asian, Black, Native American, and Latino populations are only ~29%, ~65%, ~70%, and ~72%, respectively, as likely as white-alone populations to have flood risk accounted for by FEMA SFHAs.

- With no evidence for correlation between race/affluence and NFIP insurance policy take-up rates, SFHA disparities result in poorer people and communities of color bearing a disproportionate burden of uninsured flood risk and, all other things held equal, a disproportionate amount of mortgage delinquency and wealth destruction.

- Climate change without any change in SFHA approach is set to enhance inequality in the US, with a ~19% increase in expected annual losses to 2050 in inland areas, which are where the greatest SFHA inequality exists.

- Risk Rating 2.0 (RR2.0), which is designed in large part to make the NFIP more equitable, only addresses premium re-pricing in existing FEMA SFHAs. We clearly show that it will still fall short of achieving that goal given historical preferential investment in generally whiter and more affluent neighborhoods.

- Government Sponsored Entities (GSEs) -- Fannie Mae, Freddie Mac, and Ginnie Mae -- which have a mandate to make home ownership possible and affordable to lower- and middle-income populations, are reliant on SFHA, creating regressive architecture in programs intended to be the opposite.

- To build a more equitable and sustainable program, FEMA should focus on restorative investment in terms of immediate action on floodplain modeling in historically disadvantaged areas, thereby making flood insurance much more accessible, in particular to these communities that have been left behind.

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The notice can be viewed at: https://www.regulations.gov/document/FEMA-2021-0011-0001

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