The Three F's: FEMA, Flood Insurance and...Frustration in Madison County, IL

By
Real Estate Agent with RE/MAX Alliance in St.Louis' Illinois suburbs 475.122155

Levee Map

UPDATE: Monday, January 4, 2010, FEMA announced that new flood insurance maps for the St. Louis area will be delayed until at least 2011.

That means property owners in low lying parts of Madison County won't be faced with steep increases in flood insurance premiums for at least another year.  <!--[endif]-->

Senator Dick Durbin and Congressman Jerry Costello had asked FEMA for the delay to give officials more time to devise a plan for the levees and to begin any needed repairs.   

Following is the original blog post:

There's not much reason to think about the mightly Mississippi River during the course of daily, modern life here in St. Louis' Illinois suburbs,

My 93-year-old mother-in-law grew up on a farm on Chouteau Island in the midst of the Mississippi. In those days the rushing river was a constant companion -- a threat you respected. To this day she still doesn't care for water.

But today we don't often consider that America's greatest river is flowing by as our western border. Protecting our county's flood plain communities from that force of nature is a series of levees that could be de-certified in 2010 by the Federal Emergency Management Agency (FEMA). 

SO WHO IS WATCHING THE LEVEES AND HOW DID THIS HAPPEN?

(For the purposes of this blog post, I am writing only about Madison County. St. Clair and Monroe counties have issues too, but they are a bit outside of my area. Click the map to the right to go to a larger version of the East-West Gateway map and their very good FAQ site. The map shows the levees in question.)

FEMA was tasked with re-drawing the flood plain maps for our region and other portions of the U.S. after the gulf hurricanes brought the issue top of mind.

The levees in our area were built in the 1940s and 50s and some work was done on them again in the 1960s. The new FEMA maps are expected to show that nearly all the land between the river and IL-157, where the bluffs begin, are in a flood hazard area. That's where FEMA and local officials begin to butt heads. (By the way, you'll likely hear much more public discontent from St. Louis-based media when the FEMA map changes begin to affect Missouri.)

The new FEMA maps are expected to be drawn with the assumption that the levees would not be adequate for flood control and would need to be de-certified. A new alliance of local governments -- headed by the capable Les Sterman who led the East-West Gateway Coordinating Council of Governments for many years -- says not so fast.  His organization, the Southwestern Illinois Flood Protection District Council, is beginning engineering studies to determine the levees' strengths and weaknesses based on real information, not assumptions.

I've attended public meetings in Granite City and hundreds of other citizens have attended hearings and meetings throughout the region. The majority of these meetings end with people still confused and the biggest questions they have -- of course -- revolve around their homes. "Will my home be worthless?" they ask, "And will I have to buy expensive flood insurance that I cannot afford?"

UNFORTUNATELY THE ONLY FIRM ANSWER FOR NOW IS -- MAYBE

If the new maps are released and the levees are decertified, homeowners who have a federally backed mortgage may have to pay annual flood insurance premiums of something in the vicinity of $1,000 to $1,200 for a home valued at $100,000. (By way of comparison, a $100,000 home in a low risk area would be able to get flood insurance for an annual premium of between $300 and $400.) Note that if you own your home outright you are not required to carry flood insurance. I am not suggesting that no insurance is a good idea, but this blog post is for informational purposes.

New Federal rules also are expected to limit new construction in a high risk flood zone and could possibly ban construction altogether. So, beyond residential concerns, what does this mean for the county's future economic development? What happens to existing and future business sites such as the distribution warehouses we have seen spring up over the past decade in Madison County? Flood insurance would be required, but beyond that, no one seems to be sure. Would businesses agree to relocate to or build in a "high risk" area?

To be considered as "certified," levees are now required to be judged capable of protection at the 100-year flood level. The U.S. Army Corps of Engineers has said that our area's levees may need as much as half a billion dollars worth of work before they will reach that status. Madison, St. Clair and Monroe counties are now collecting a quarter-cent sales tax to pay for levee repairs, but the collections to date have only been a drop in the bucket compared to what is needed.

WELL, WHO IS DOING SOMETHING ABOUT THIS?

Congressman Jerry Costello has introduced a bill titled H.R. 3415 which is designed to block the new flood plain maps. His bill also would allow property owners to choose between low risk insurance coverage or carrying no coverage. Neither Senator Durbin nor Senator Burris has signed on to support the plan in the Senate. Get bill details here at Costello's site.

FEMA has a plan of its own which requires flood insurance but holds down the premiums somewhat for a 10-year period while local authorities work to improve the levees. This is called an AR designation and each affected community needs to apply for it.

WHILE ALL THIS IS BEING SORTED OUT, WHAT CAN YOU DO?

Some officials have suggested buying flood insurance now while your home is still considered to be in a low risk area and then carrying over your lower rates once the area is deemed high risk. This smacks of the inevitability of the situation, but it could save you $700 or $800 per year. Talk with your insurance agent to find out what types of premiums he or she is offering and if your rate would be grandfathered in should the risk assessment change.

Tell your elected officials what you think about this issue. Here are links to a few of their sites:

Congressman Jerry Costello

Congressman John Shimkus

Senator Dick Durbin

Senator Roland Burris

Madison County Board Chairman Alan Dunstan (scroll down for his contact information)

You can see existing flood maps by clicking www.floodsmart.gov, FEMA's consumer site.

You can see a status report prepared by the Southwestern Illinois Flood Prevention Initiative.

Here is the site for the local governmental group working toward a solution.

Additionally, the St. Louis Post-Dispatch, Belleville News-Democrat, Alton Telegraph and the St. Louis Beacon have been keeping track of the situation.

To get up-to-the-minute information as developments occur, consider setting a Google alert that will send details directly to your email as your own personal news service. I'd suggest plugging the words "FEMA, "Madison County," "Flood" and "Illinois" into the alert for the best specific results. Learn more about Google alerts here.

Questions will remain for the forseeable future, but I hope this information and these links will provide resources for my real estate clients, friends and family members who will be impacted by this situation in 2010 and beyond.

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Here's a January 2010 update from the St. Louis Post-Dispatch.

 

Jan 19, 2010 02:42 AM #1
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