Purchasing Flood-Prone Property
Release Date: August 28, 2008
Release Number: 1763-175
» More Information on Iowa Severe Storms, Tornadoes, and Flooding
DES MOINES, Iowa -- Because of the widespread interest in buyouts, disaster officials have released the following information about the process for the federal/state program.
The key points federal and state officials emphasize are these.
- Purchase of flood-prone property is a lengthy process that typically takes one year to 18 months before it is completed and the property is purchased.
- This is a hazard mitigation program, meaning it is designed to reduce the impact of future disasters.
- Acquisition projects are voluntary and homeowners are never forced to sell their property. The decision to buy damaged property is made by the local government and the property owners, not by Iowa Homeland Security and Emergency Management (HSEMD) or the Federal Emergency Management Agency (FEMA).
The federal/state program is called the "Hazard Mitigation Grant Program." It is funded 75 percent by FEMA and 25 percent by a combination of state, local or individual sources. The program requires that:
- All sales must involve willing sellers.
- The purchase price for properties must be at their pre-flood fair market value.
- Acquired property must revert to natural floodplain or be maintained as open space.
- No future disaster payments will be made for the purchased site.
Tenants who are displaced because of a buyout may receive moving and replacement rental expenses (or can use those funds toward buying a home).
The basic steps in the buyout process are as follows.
- The community submits a Notice of Interest to the Iowa HSEMD that identifies property owners who are interested in a buyout. This notice is due September 12.
- The Iowa HSEMD reviews the Notice of Interest to determine if the community is eligible. (It must have a FEMA approved Local Hazard Mitigation Plan and be in good standing with the National Flood Insurance Program.)
- The Iowa HSEMD invites (or declines) the community to complete a formal Hazard Mitigation Grant Program application.
- The application is prepared by local officials with input from the community and from affected homeowners.
- The Iowa HSEMD reviews the application and forwards those that are consistent with state mitigation objectives to FEMA for approval.
- FEMA reviews the application to ensure it
- Is consistent with the state mitigation plan,
- Provides a beneficial impact to the state,
- Is cost effective,
- Is an environmentally sound use of funds, and
- Solves a problem independently.
If FEMA grants approval, the state authorizes the local government to begin the acquisition process. The local community then identifies willing sellers, conducts appraisals, purchases properties and takes title.
After a home is purchased, it is demolished and the land is cleared. The property title is deed-restricted and the land must remain forever as public open space.
It is important to note that before any funds can be received for a project under this program, the community must have a FEMA-approved local hazard mitigation plan in place. If a community has destroyed homes and is engaged in the planning process now, it may still have an opportunity to be awarded funds.
FEMA coordinates the federal government's role in preparing for, preventing, mitigating the effects of, responding to, and recovering from all domestic disasters, whether natural or man-made, including acts of terror.
Last Modified: Friday, 29-Aug-2008 14:58:53