Recent FEMA CRS Retrogrades in Florida and How Forerunner Can Help

Last week, FEMA Region 4 retrograded five Florida communities out of the Community Rating System (CRS) due to concerns about SI/SD tracking and enforcement after Hurricane Ian. The retrograde was immediate, with CRS premium discounts for NFIP policies ending October 1st. For context, Hurricane Ian (2022) was the third costliest hurricane in U.S. history, with damages estimated at approximately $113b and rebuilding efforts that continue to this day. Residents in the communities that were retrograded were receiving up to 25% discounts in flood insurance premiums and those discounts played an important role in enabling recovery after the hurricane. With the retrograde, property owners in the region will be losing tens of millions of dollars in discounts until their communities are allowed to regain their CRS classes. 

What Happens Next? 

FEMA will expect retrograded communities to take steps to address the identified issues  and reevaluate the communities in six months. If the communities are making sufficient progress in addressing the issues identified by FEMA, they will be able to rejoin CRS in April 2026. FEMA may decide to place those communities on NFIP probation if they are not addressing the issues identified.

As of April 8, 2024: FEMA announced a 30-day pause and each of the five communities will have an additional 30 days to gather requested documentation to help retain their standing in the Community Rating System. If they are able to gather the requested documentation, they will not be penalized.

What does NFIP probation mean for a community? 

‍When the FEMA Regional Office attempts to resolve compliance issues through community assistance or consultation fails, they may place a community on probation. The probationary period lasts until all violations have been remedied to the maximum extent possible, and it may be extended for one additional year. While probation does not affect the availability of flood insurance, an additional charge of $50 will be added to each policy’s premium for at least one year. 

When a community is given the 90-day written notice of probation, the affected Congressional delegation is also notified, each flood insurance policyholder in the community is given 90 days' notice about the $50 surcharge, and local media receives a 60-day notice in the form of a press release.

If violations are not remedied while a community is on probation, the FEMA Regional Director may recommend a community’s suspension from the NFIP.

What are common challenges in enforcing and tracking SI/SD?

We wrote about some of the challenges to post-disaster recovery and data collection after Hurricane Ian struck here. Post-disaster, municipalities and counties are tasked with the difficult job of assessing damages across their jurisdictions. Structures that are deemed substantially damaged are required to meet present-day floodplain management regulations in order to be rebuilt. This requirement helps communities ensure that these structures are not as vulnerable to future flooding events but, practically speaking, enforcing substantial damage regulations can result in a significant investment for property owners. As a result, it’s important that damage assessments are done correctly but doing so can be onerous for a number of reasons including documentation challenges, difficulty accessing impacted areas, and limited access to internet. Compounding this, the permitting backlog can become huge when damages at the scale of Hurricane Ian are sustained – making sure that structures are built compliant to floodplain standards while also tackling an immense amount of post-disaster rebuilding is often a huge lift.

How can Forerunner help? 

FEMA’s enforcement action underscores a growing need for communities across the country to develop robust Substantial Improvement/Substantial Damage enforcement and tracking processes so that they’re prepared well before a hurricane hits. If you work in a community currently using Forerunner, some features that can assist in your work include: 

• Preliminary Damage Assessments: Forerunner’s Preliminary Damage Assessments (PDAs) help our partners compile robust information about damages rapidly after hurricanes. The goal is to make capturing PDAs quick and efficient, since conducting damage assessments can often be one of the biggest hurdles for communities after big disasters. 
• Mobile App: Our recently launched mobile app offers an offline mode that enables users to seamlessly collect data (like PDAs) in the field for office review later. The offline mode can be especially impactful in post-disaster scenarios where internet connectivity is hard to come by.
• Property-Level Damage Warnings:  Damage data that is collected with Forerunner can be displayed geospatially with a warning, allowing other Forerunner users in your community to know if a property was impacted. Warnings can also be shown on your public website, which can help inform the public that their property has been reviewed and flagged for damages.
• SI/SD Tracking: Forerunner’s SI/SD feature enables users to track Substantial Improvement and Substantial Damage costs on every individual property in your community. As damages are added, Forerunner can let you know if the total damage costs exceeds the 50% threshold, requiring a Substantial Damage Letter.  If you have a cumulative SI/SD ordinance, your account can be adjusted to account for a longer tracking period or lower percentage.
• Letter Generation: Our recently launched Letter Generation feature can help you generate and store Substantial Damage Letters for any properties that have been impacted – allowing you to get information about damage assessments to your residents and property owners faster. 
• Post-Disaster Resident Communication: Your Forerunner public website can be a great resource for surfacing flood risk information, regulatory requirements, and damage warnings post-disaster. The website’s Get Help form can also add a easy-to-use path to seeking support from your team.

Please don’t hesitate to reach out to us for support in using any of these features – we’re happy to provide refresher trainings or chat about how the software can meet your needs. If your community doesn’t currently use Forerunner, we’re always eager to offer insight into how our partners manage their SI/SD workflows. You can also utilize a free software pilot license to take advantage of these features quickly without obligation. Feel free to get in touch. 

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Other helpful resources

We interviewed floodplain administrators nationwide to understand how they create ordinances, track property costs, and communicate with residents - and what other resources are available to help. Our findings are consolidated in a recently published SI/SD white paper, and the different resources we identified are listed below: 

• FEMA provides multiple resources outlining SI/SD requirements, including the SI/SD Desk Reference, Answers to Questions About Substantially Improved/Substantially Damaged Buildings, and the Substantial Damage Estimator Tool.
• This Addendum to the 2017 CRS Coordinator’s Manual was issued by FEMA instead of producing a fully revised edition at this time. The Addendum includes new opportunities for communities to earn CRS credit for protecting threatened and endangered species, mitigating substantial damage, and promoting flood insurance and the Substantial Damage Estimator Tool.