Bill Championed by NAHB Would Address Major Flood Mapping Issue in California, Nationwide

Legislation that NAHB has been seeking for two years that would allow new housing developments to go forward in California and bring down insurance costs for home buyers and home owners was introduced in Congress today. This legislation represents an important win not only for NAHB and California home builders and home owners, but for builders and home owners nationwide.

The Keeping Homeownership Costs Down Act (H.R. 3800) — introduced by Reps. Doug LaMalfa (R-Calif.), Doris Matsui (D-Calif.), Young Kim (R-Calif.) and Brad Sherman (D-Calif.) — would allow the Federal Emergency Management Agency (FEMA) to resume processing certain floodplain map changes to allow new home building projects to advance and help ease affordability challenges.

In May 2023, FEMA suspended processing of Letters of Map Revision (LOMR) and Conditional Letters of Map Revision (CLOMR) in dozens of California counties because of a confidential legal settlement between FEMA and environmental advocates. The advocates claimed that the simple act of revising floodplain maps negatively impacts federally protected species or their designated critical habitat under Section 7 of the Endangered Species Act (ESA).

The practical effect of this suspension is that it increases the ownership costs for tens of thousands of new housing units because they are mistakenly mapped within the 100-year floodplain and therefore required under the National Flood Insurance Program to have and maintain federal flood insurance coverage.

Since FEMA acted two years ago, NAHB has been working with state and local HBAs across California to seek legislative and regulatory remedies. In short, this bill would help keep homeownership costs down by preventing home owners from being required to purchase expensive federal flood insurance for properties that are not actually located within the 100-year floodplain.

Here’s how it works: The bill directs the FEMA administrator to continue to issue LOMR/CLOMR letters while the U.S. Fish and Wildlife Service and National Marine Fisheries Service work through the required ESA Section 7 review. The provisions of the bill expire when the Section 7 process is completed. The bill would allow FEMA to issue LOMR/CLOMR letters so that developers can continue the practice of building homes on fill to elevate the structures above the base flood elevation, which then exempts the home owner from having to purchase flood insurance.

Further, this legislation would not bypass the ESA because land development and or construction activities that may disturb federally protected species or their designated critical habitat must still comply with the ESA.

Although this mapping issue has primarily affected California, this legislation would ensure similar problems are not repeated in other states that have federally protected species that reside within floodplain areas.