[Federal Register: October 31, 2007 (Volume 72, Number 210)]
[Rules and Regulations]
[Page 61545-61552]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr31oc07-18]
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DEPARTMENT OF HOMELAND SECURITY
Federal Emergency Management Agency
44 CFR Part 78
[Docket ID FEMA-2007-0003]
RIN 1660-AA00
Flood Mitigation Assistance
AGENCY: Federal Emergency Management Agency, DHS.
ACTION: Final rule.
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SUMMARY: The Federal Emergency Management Agency (FEMA) is adopting as
final, without substantive change, an interim rule that implements
sections 553 and 554 of the National Flood Insurance Reform Act of
1994. Section 553 authorizes a flood mitigation assistance program
through which FEMA is authorized to provide grants to States and
communities for planning assistance and for mitigation projects that
reduce the risk of flood damage to structures covered under contracts
for flood insurance. Section 554 establishes the National Flood
Mitigation Fund to fund assistance provided under section 553.
DATES: Effective Date: November 30, 2007.
FOR FURTHER INFORMATION CONTACT: Cecelia Rosenberg, Mitigation
Directorate, Federal Emergency Management Agency, 500 C Street, SW.,
Washington, DC 20472, (phone) 202-646-3321, (facsimile) 202-646-2719,
or (e-mail) cecelia.rosenberg@dhs.gov.
SUPPLEMENTARY INFORMATION:
I. Background
Sections 553 and 554 of the National Flood Insurance Reform Act of
1994 (NFIRA) (Pub. L. 103-325, enacted September 23, 1994) (also known
as Title V of the Riegle Community Development and Regulatory
Improvement Act of 1994) amended the National Flood Insurance Act of
1968 (42 U.S.C. 4101 et seq.). Specifically, section 553 authorized the
Director (now Administrator) of the Federal Emergency Management Agency
(FEMA) to carry out a flood mitigation assistance program, known as the
Flood Mitigation Assistance Program (FMA). Through the FMA Program,
FEMA is authorized to provide grants to States and communities for
planning assistance and mitigation projects that reduce the risk of
flood damage to structures covered under contracts for flood insurance.
Section 554 required FEMA to establish the National Flood Mitigation
Fund (NFMF) to provide funds for flood mitigation program assistance
described in section 553. On March 20, 1997 (62 FR 13346), FEMA
published an interim rule implementing section 553 and 554 of the
National Flood Insurance Reform Act.
This final rule adopts, without substantive change, the regulations
established by the March 20, 1997 interim rule. It addresses the
comments received from the public in response to the interim rule, and
finalizes the regulations contained in 44 CFR part 78.
Records Management
The Regulation Identifier Number (RIN) listed in the March 20, 1997
interim final rule was 3067-AC45. Since FEMA became a component of the
Department of Homeland Security (DHS), FEMA's RINs were renumbered and
3067-AC45 became 1660-AA00.
II. Discussion of Public Comments
FEMA received seven public comments on the interim rule. The seven
commenters included five States, one local government, and one
association. The comments received, together with FEMA's responses, are
set forth below.
The Community Rating System. One commenter wrote that while it is
good that the Community Rating System (CRS) criterion may be a basis
for a floodplain management plan, CRS communities with repetitive loss
or floodplain management plans developed prior to the publishing of 44
CFR part 78 in March 1997 may not realize that their plans will require
modification to meet the new criteria of 44 CFR 78.5, and States and
regions should be counseled to closely review these older plans. The
commenter wrote that the CRS plan reviewer for the Insurance Services
Organization (ISO) should be consulted before any FEMA region approves
any CRS plans developed prior to 1997 for the purpose of receiving FMA
project funds unless the region or State carefully reviews them to see
that they meet FMA criteria. The commenter wrote that the States and
regions should accept nothing less than plan adoption by resolution of
the community's governing board. The commenter also wanted FEMA not to
accept as evidence of adoption a letter from the Mayor stating that the
community will follow the plan since the CRS criterion requires full
adoption by the governing board. The commenter thought that FMA should
be consistent with the CRS plan adoption process and require that all
local elected officials see the proposed plan and ratify it.
FEMA's Response: The CRS program is a voluntary program that
predates these regulations and creates an incentive for communities
that participate in the National Flood Insurance Program (NFIP) to
implement floodplain management practices that exceed NFIP minimum
requirements. The CRS program, which was established in 1993, provides
credit for communities in the form of lower flood insurance premium
rates for property owners. The CRS has been and is currently operated
by FEMA through an agreement with ISO. The schedule of creditable
activities is described in its reference guide, the CRS Coordinator's
Manual available through http://www.fema.gov/business/nfip/intnfip.shtm.
One of the approved CRS activities that communities may
receive credit for is to develop a flood mitigation or repetitive flood
loss plan.
FEMA has addressed CRS plans developed prior to 1997 by
coordinating with CRS staff to ensure that all review criteria are
consistent with FMA and CRS plans. As a result, FEMA has accepted CRS
plans based on guidance provided in FEMA Publication No. 299: The FMA
Program Guidance (August 1997), as meeting the requirements of Sec.
78.5 as approvable local Flood Mitigation Plans. Further, ISO continues
to review CRS plans submitted by local communities against the
requirements of Sec. 78.5 if requested by a local
[[Page 61546]]
community. Such plans would then be forwarded to the State and FEMA for
approval as FMA plans.
Further, Sec. 201.6(c)(5) states that the planning process shall
include, documentation ``that the plan has been formally adopted by the
governing body of the jurisdiction requesting approval of the plan
(e.g. City Council, County Commissioner, Tribal Council).'' FEMA has
provided implementation procedures in the Multi-Hazard Mitigation
Planning Guidance under DMA2000 (Disaster Mitigation Act of 2000)
located at http://www.fema.gov/plan/mitplanning/index.shtm, which
describes how local executives and governing bodies can facilitate plan
approval according to local laws and procedures consistent with Sec.
201.6(c)(5).
Insurable structures. One commenter wrote that Sec. 78.1(b)
discusses assisting State and local governments in funding cost-
effective actions on ``insurable'' structures, while Sec. 78.12
discusses eligible types of projects as being ``insured structures.''
The commenter asked whether the regulation covers ``insurable''
structures or ``insured'' structures. Another commenter wrote that
since the State plan must be in place to address insurable structures,
this limits the State's eligibility for project money for State
agencies who do not have public buildings to protect or whose mission
does not involve the protection of private structures. A third
commenter asked if States that participate in the self-insurance
program are eligible for FMA project monies that affect State owned
facilities insured under their program.
FEMA's Response: The terms ``insurable'' and ``insured'' were used
in part 78 interchangeably. FEMA realizes it made a technical error in
using insurable and insured interchangeably as the two terms have
different definitions. FEMA intended to mean ``any structure covered by
an insurance policy underwritten by the NFIP.'' FEMA has revised Sec.
78.1(b) in this final rule by replacing ``insurable'' with ``insured.''
The authorized purpose for the FMA program is to reduce the risk of
flood damage to structures covered under contracts for flood insurance.
Furthermore, activities funded under FMA must be cost-beneficial to the
NFMF. Thus, self-insured structures within States participating in the
self-insurance program are not eligible to receive FMA project funds.
Use of Planning Grants. One commenter wrote that under Sec.
78.1(b), planning grants can be used to ``assess the flood risk and
identify actions to reduce that risk'' but the supplementary
information section of the interim rule on planning grants states that
the ``purposes of the planning grants is to develop or update a Flood
Mitigation Plan.'' The commenter asked if the State or the community
could receive a planning grant without actually developing a Flood
Mitigation Plan.
FEMA's Response: FEMA will only fund planning activities that will
result in a completed project, which in this case is a FEMA-approved
State or local flood mitigation plan. The language in Sec. 78.1(b)
states that FMA planning grants are intended to help State and local
communities assess the flood risk and identify actions to reduce risk.
The local mitigation plan is the process FEMA uses for the community to
assess flood risk and identify actions to reduce flood risk. Sections
78.4 and 78.5 define eligible planning grant activities. States may
only use FMA planning funds to develop State and local Flood Mitigation
Plans, which must be adopted by the governing body of the jurisdiction.
Definition of the term ``community.'' One commenter wrote that as
written, Sec. 78.2's definition of ``community'' could be interpreted
to mean that any jurisdiction, city, or county that does not have the
authority to adopt a building code or require zoning, even if that
jurisdiction, city, or county has a good floodplain management program
would not be eligible for participation in FMA. The commenter wrote
that numerous States do not give ordinance-making authority to county
level government. For example, in Texas, counties can participate in
the NFIP, and some have very strong floodplain management programs, but
without the ability to adopt building codes or regulate land use
through zoning, would this exclude them from FMA participation?
Additionally, the City of Houston has an active floodplain management
program with over 45,000 flood policyholders who pay over $16.5 million
annually in premiums; however, the city has no zoning (although they
have adopted a building code). Does a literal interpretation of the
regulation exclude the City of Houston from FMA eligibility?
One commenter wrote that although no one has explicitly included
regional agencies (e.g., regional planning commissions, urban drainage
districts, metropolitan sewer or sanitary districts, and similar
agencies) within the definition of ``communities,'' regional agencies
often manage sizable floodplain management programs and have their own
mitigation programs; thus, FEMA should consider regional agencies as
eligible applicants for grant funds. The commenter wrote that regional
agencies can also provide a great deal of planning and technical
assistance support to eligible communities.
FEMA's Response: FEMA has historically been flexible in providing
FMA planning and project subgrants to local flood control districts
that have the capacity to plan for and implement mitigation measures
but that may not have the delegated authority from the State to adopt a
building code or zoning ordinances. Local flood control districts
acting on behalf of one or more local communities would meet the
requirements of Sec. 78.3(b)(2) for the purpose of receiving FMA
subgrants. Further, FEMA would consider plans developed by local flood
control districts to be multi-jurisdictional plans. Section 201.6(c)
requires that multi-jurisdictional plans include: (1) Identifiable
action items specific to each jurisdiction requesting FEMA approval or
credit for the plan, and (2) documentation that the plan has been
formally adopted by a governing body representing each jurisdiction
such as a City Council, County Commissioner, or Tribal Council.
Planning Grant Approval. One commenter wrote that Sec. 78.3(b)(2)
says that the State point of contact can award the planning grants, but
that it is unclear whether FEMA approves the planning grants, because
Sec. 78.3(a)(2) states that the Director of the FEMA Region will
approve the Flood Mitigation Plans.
FEMA's Response: FEMA approves all eligible FMA planning grant
applications submitted by the State. The State in turn awards funds to
local communities as subgrants. Once the local community has completed
the plan, it is forwarded to the State for review and submission to
FEMA for approval in order for the local community to become eligible
to receive FMA project subgrants.
Procedures for forwarding planning documents to FEMA. One commenter
wrote that Sec. 78.3(b), which refers to alternative procedures
outlined in Sec. 78.14 that allow the community to coordinate planning
document directly with FEMA, seems to imply that these alternative
procedures have been formulated. The commenter believes that it is
vital that the procedures be finalized and published as soon as
possible.
FEMA's Response. The alternative application procedures provided at
Sec. 78.3(b) have been seldom utilized by local communities applying
for FMA project and planning grants. However, procedures on alternative
application
[[Page 61547]]
procedures were described in more detail in the FEMA 299 (``Flood
Mitigation Assistance Guidance,'') the original FMA implementation
document.
Eligibility for Technical Assistance. One commenter wrote that
under Sec. 78.4(a), the State is eligible to apply for Technical
Assistance grants, and that FEMA Region VII has stated that the State
can pass the TA funds through to the local level (i.e., Council of
Governments) to administer the TA. Does this mean that local
jurisdictions are not eligible to directly apply for the TA funds?
FEMA's Response: States have been permitted to pass FMA technical
assistance funds through to the local level under Sec. Sec. 78.4(b)
and 78.8(c) as long as that amount does not exceed 10 percent of the
local community's project allocation from the State.
Increase Project Grant funds. One commenter wrote that the base
amount of $100,000 awarded to each State for Project Grants is
insufficient to perform any meaningful flood mitigation planning
projects. The commenter cited the project category of land acquisition
of insured structures and underlying real property, where, in many
cases, the cost of acquiring a single real property site may exceed
$50,000. As a result, the base amount of $100,000 awarded to a State
for Project Grants will only allow a State to do very small and
inexpensive projects that may not significantly impact a State's long
term goal to advance its flood mitigation program within the State.
FEMA's Response: FEMA agrees with the commenter, and will consider
removing the $100,000 base limitation in a future rulemaking.
The 5 year grant allocation of $150,000. One commenter asked if,
under Sec. 78.8(b), the State can apply once every 5 years for a
single planning subgrant of $150,000, and then carry over any
unobligated planning grant dollars to the next fiscal year until the 5-
year period expires. The commenter also asked if the State can submit
an application for a $150,000 planning grant and have FEMA make
separate subgrant awards in phases over 5 years, as long as the total
amount does not exceed $150,000 in 5 years. Another commenter wrote
that, per Sec. 78.9, if the maximum performance period for a planning
grant is 3 years, why does a State or community have to wait for 5
years to apply for another planning grant. Another commenter wrote that
since planning grants can only be issued to States once every 5 years
for an amount up to $150,000, the allocations presented to the States
will preclude most States from reaching the $150,000 ceiling if they
chose to accept the planning grant allocation in the interim final
rule. The commenter felt that the emphasis seems to be the issuance of
one grant, not the maximum of $150,000.
FEMA's Response: The State may apply for the full 5-year statutory
limit of $150,000 in one grant application if FEMA allocates that
amount to the State based on the formula provided in Sec. 78.8(a).
Further, the State may apply for multiple applications that total
$150,000 over any 5-year period. FEMA believes that the 3-year
performance period on planning grants is sufficient for completing and
gaining FEMA approval on an FMA plan, and this statutory requirement is
not related directly to the 5-year cycle on limits for FMA planning
funds. Finally, the National Flood Insurance Act of 1968, as amended
(42 U.S.C. 4104c) does not require that each State receive the maximum
$150,000 over any 5-year period.
Limits on FMA funds. One commenter asked if, under Sec. 78.8, TA
dollars are included in the $20 million maximum for project grants. Can
the $20 million be spread over 5 years? Do the awarded funds also have
to actually be spent within the 5 years? Another commenter wrote that
although he understood funding for the FMA project grant funding was
limited to $3,300,000 to any community over 5 years, setting arbitrary
limits on States or communities will only serve to stifle the overall
effectiveness of the program, and establishing such a low limit puts an
unnecessary restraint on the commenter's potential program.
FEMA's Response: The National Flood Insurance Act of 1968, as
amended (42 U.S.C. 4104c) lists the statutory limits on FMA project
funds at $20,000,000. Since the FMA technical assistance allocation is
currently 10 percent of the project grant, all technical assistance
funds must be counted as part of the 5 year $20,000,000 for States.
FEMA does consider waivers of these statutory funding limits during
major disasters or emergencies declared by the President as a result of
flood conditions consistent with the National Flood Insurance Act of
1968, as amended (42 U.S.C. 4104c).
Eligibility of mapping projects. One commenter wrote that the
limitation regarding planning grants and floodplain map updates in
Sec. 78.9 is a concern. The commenter stated that current floodplain
maps and the provision of map information in digital format are
fundamental in estimating the population and structures at risk. The
commenter felt that flood mitigation plans will suffer without the
eligibility of funding updated floodplain maps to write them. The
commenter asked that FEMA reconsider mapping projects as eligible for
FMA planning grants.
FEMA's Response: FEMA is actively engaged in the development and
update of floodplain maps under a separate authority of the NFIP (42
U.S.C. 4101), and receives separate appropriations to digitize maps
under the Map Modernization program for use by States and local
communities in their floodplain management and mitigation planning
activities. FEMA determined that mapping activities under FMA to be a
duplication of programs; therefore, mapping activities are not included
in part 78. States and local communities receive funds for flood
mapping activities under the Cooperating Technical Partners Program
(CTP). The CTP is an innovative approach to creating partnerships
between FEMA and participating NFIP communities, regional agencies, and
State agencies that have the interest and capability to become more
active participants in the FEMA Flood Hazard Mapping Program. Also,
FEMA provides States and local communities with access to flood hazards
data including Flood Insurance Rate Maps (FIRMs), Letters of Map
Changes, and other technical documents through its Map Service Center
at http://msc.fema.gov/webapp/wcs/stores/servlet/FemaWelcomeView?storeId=10001&catalogId=10001&langId=-1
.
Delay caused by FEMA final approval. One commenter wrote that under
Sec. 78.10, the project grant approval process, project applications
will be forwarded to FEMA for final approval, and FEMA will provide
funding on a project-by-project basis through a supplement to the
annual Cooperative Agreement (CA). The concern is that project-by-
project approval through the regional offices can be very time
sensitive and not conducive to accessing the FEMA dollars within the
performance period. Does project-by-project approval delay State access
to any of the 10 percent TA dollars associated with the project
dollars?
FEMA's Response: FEMA currently awards FMA grants to States using
an e-Grant system, rather than through a CA. In 1997, FEMA opted to
award most non-disaster grant funds to States under the combined
Emergency Management Performance Grant (EMPG). However, FMA and other
FEMA non-disaster mitigation grants did not fit under the EMPG
structure. This is because the EMPG process was designed for awarding
and tracking non-construction
[[Page 61548]]
grants, and most mitigation grants, including FMA grants, are awarded
and tracked as construction grants. Therefore, FEMA developed a
Mitigation e-Grant system which grantees must use to apply for FMA and
Pre-Disaster Mitigation Grant Program grants, as required by the E-
Government Act of 2002 (Pub. L. 107-347) and the Federal Financial
Assistance Management Improvement Act of 1999 (Pub. L. 106-107). States
receive one FMA grant award each fiscal year that includes project,
planning, and technical assistance subgrants. Each time a new subgrant
is awarded, the annual State grant is automatically amended in the e-
Grant system. States are awarded technical assistance funds based on
the total dollar amount of eligible FMA project applications. The e-
Grant system has facilitated the receipt of all FMA funds, including
technical assistance funds to States, in a timelier basis than at the
inception of the program.
Eligible types of projects. One commenter stated that a strict
interpretation of what encompasses an eligible structure under Sec.
78.12(a) could have a harmful effect on a community's Flood Mitigation
Plan. The commenter suggested program flexibility to allow communities
the ability to complete their plans; the commenter also suggested a
requirement that 90 percent of the properties have flood insurance.
Three commenters wrote that the phrase ``minor physical flood
mitigation'' in Sec. 78.12(g) needs a better definition. The term
``minor'' is subject to a great deal of interpretation. Commenters
suggested that FEMA establish a dollar cap ($100,000), determine a
scope of work limitation on this category of project, or further define
the term ``minor'' to clarify the type of project that is eligible for
funding. One commenter wrote that the term ``Beach nourishment
activities'' in Sec. 78.12 needs a better definition. The commenter
stated that more specific guidelines will reduce or prevent abuses of
FMA intent. Another commenter felt that the acquisition of insured
structures and the demolition and removal of insured structures on
acquired property per Sec. 78.12 should be considered as one type of
project in its entirety.
FEMA's Response: FEMA agrees that a strict interpretation of what
encompasses an eligible structure could be detrimental, and FEMA does
not dictate the definition of eligible structure. In fact, FEMA allows
local communities to conduct their own risk assessments in the process
of developing their local mitigation plans; these risk assessments can
include identifying eligible insured and non-insured properties for
future hazard mitigation projects. In response to the comment regarding
a 90 percent flood insurance requirement, if a local community chooses
to apply for an FMA project grant, all properties included in the
application must have an NFIP insurance policy in force at the time of
application. The local community can encourage an uninsured property
owner to become NFIP-insured in order to participate in an FMA
mitigation project that is otherwise cost beneficial to NFMF. In
response to the comment that ``minor physical flood mitigation'' be
better defined, the phrase is derived from the eligible mitigation
activities as stated in the National Flood Insurance Act of 1968, as
amended (42 U.S.C. 4104c):
Minor physical mitigation efforts that do not duplicate the
flood prevention activities of other Federal agencies and that
lessen the frequency or severity of flooding and decrease predicted
flood damages, which shall not include major flood control projects
such as dikes, levees, seawalls, groins, and jetties unless the
Director specifically determines in approving a mitigation plan that
such activities are the most cost-effective mitigation activities
for the National Flood Mitigation Fund.
FEMA does not place a funding limit on the amount a local community may
apply for an individual minor localized structural flood control
project, since the only limit provided by the statute is the 5-year-
statutory-funding limit of $3,300,000 on FMA projects funds for local
communities. FEMA expects to address the issue of beach nourishment as
well as the acquisition of real property and demolition or relocation
of buildings for open space in a future rulemaking.
Grant administration. Three commenters wrote that Sec. 78.13 makes
no mention about administrative costs incurred by grantees and
subgrantees as grant program participants. The commenters wrote that
this section is unclear as to whether or not State and local
governments are expected to bear these administrative costs (which can
be considerable) on their own or as part of the grant program. One
commenter recommended that this section be rewritten to state that the
administrative costs incurred by State and local governments can be
considered to be part of the non-Federal 25 percent cost share for an
eligible grant. Another commenter asked if the States received
administrative allowance funds to administer the FMA dollars, as States
do with the Hazard Mitigation Grant Program (HMGP). A commenter stated
that Sec. 78.13(a) penalizes States that may be willing to contribute
a Full Time Employee (FTE) dedicated to providing technical assistance
to other State agencies and communities. The requirement of a cash
contribution from States may prohibit many States from participating,
especially with the limited amount of funding available; the commenter
also opposes the 12.5 percent limit on in-kind contributions. One
commenter asked if time extensions are awarded under Sec. 78.13(c).
FEMA's Response: Currently, States are eligible to apply for FMA
technical assistance funds to pay State Program Manager salaries as
long as those amounts are directly allocable to the FMA program and do
not duplicate costs allowed under a State's indirect cost agreement.
Any amount reimbursed for salaries requires a 25 percent non-Federal
cost share, half of which must be provided as cash. The FMA cost-share
requirement for planning and project activities and management costs
remains consistent with current statutory requirements under the
National Flood Insurance Act of 1968, as amended (42 U.S.C. 4104c):
The Director may not provide mitigation assistance under this
section to a State or community in an amount exceeding 3 times the
amount that the State or community certifies, as the Director shall
require, that the State or community will contribute from non-
Federal funds to develop a mitigation plan under subsection (c) and
to carry out mitigation activities under the approved mitigation
plan. In no case shall any in-kind contribution by any State or
community exceed one-half of the amount of non-Federal funds
contributed by the State or community.
FMA grant performance periods may be extended consistent with the
guidelines provided in Sec. 13.23(b) and implemented in annual program
guidance at http://www.fema.gov/government/grant/fma/index.shtm and
consistent with statutory time limitations on FMA planning grants
provided in the National Flood Insurance Act of 1968, as amended (42
U.S.C. 4104c). Generally, the performance period of FMA project grants
may be extended twice if work is in progress and if financial and
programmatic progress reports are current. FMA planning grants may be
extended one time within the maximum statutory 3-year performance if
work is in progress and if financial and programmatic progress reports
are current.
Fund rollover. One commenter requested additional information
regarding the appropriations rollover for FMA dollars to the next
fiscal year.
FEMA's Response: If Congress appropriates funds, States are awarded
FMA grants annually based upon State
[[Page 61549]]
target allocations. Congress historically has appropriated FMA funds
with a 2-year period of availability. FEMA will carryover FMA funds,
including technical assistance funds, once during the 2-year period of
availability, if the State has eligible projects that require further
benefit cost, engineering, or environmental review and that could not
be obligated during the first fiscal year. Eligible project, planning,
and technical assistance grants must be obligated within the 2-year
period of availability. The maximum recommended performance period for
FMA project and technical assistance grants is 4 years, and the maximum
statutory performance period for FMA planning grants is 3 years.
The Catalog of Federal Domestic Assistance number. A commenter
asked for the Catalog of Federal Domestic Assistance (CFDA) number.
FEMA's Response: The current CFDA number for FMA grants awarded
under part 78 is 97.029. The FEMA Assistance Officers and their State
counterparts are notified of the current CFDA number through annual
program guidance at http://www.fema.gov/government/grant/fma/index.shtm
.
Plan revisions. A commenter asked if a community has to follow the
same procedure for developing and adopting the initial flood mitigation
assistance plan in order to submit a revision to the plan. One
commenter asked if an administrative revision to the local plan would
require public participation. Another commenter asked if the State can
approve a revision to the local plan or if FEMA must approve the
revision.
FEMA's Response: Under part 78, revisions to flood mitigation plans
are not required after initial approval of the plan. Further, there is
no FEMA requirement for public participation in administrative
revisions to flood mitigation plans. However, States may establish
their own policies and procedures on requiring and approving local plan
updates and/or administrative revisions.
Communities that have pre-existing plans. A commenter asked whether
communities that already have developed a flood mitigation plan can
obtain a planning grant to update or revise its flood mitigation plan
to fit FMA requirements.
FEMA's Response: States and local communities can apply for FMA
planning funds every 5 years for the purpose of plan updates and can
reapply for funds during the same 5-year period if the State or local
community has not exceeded the State limit of $150,000 or the local
limit of $50,000.
Approval time. One commenter asked for the amount of time that the
FEMA has to approve a revision to the plan.
FEMA's Response: Under the terms of the National Flood Insurance
Act of 1968 as amended, (42 U.S.C. 4104c), FEMA has 120 days to approve
any revisions or updates to the original FEMA-approved plan if such
revisions or updates are funded with FMA program funds.
The scope of mitigation planning. One commenter wrote that all
flood mitigation projects are, in fact, local projects, and that the
interim final rule places too much emphasis on community flood
mitigation planning as opposed to planning on an entire watershed
basis. The commenter wrote that the flood mitigation program should
encourage the development of a flood mitigation planning approach that
will take into consideration all relevant flood mitigation factors and
impacts within a watershed. The commenter wrote that FEMA can take the
lead in promoting a much more comprehensive solution to the nation's
flood mitigation problems.
FEMA's Response: Flood mitigation plans developed to meet the FMA
planning requirements may be multi-jurisdictional, such as a watershed-
based approach. Multi-jurisdictional plans include local planning
objectives submitted from each community or jurisdiction that would
have its local governing body adopt the plan for the purpose of
receiving FMA project funds.
State distribution of grant funds. One commenter wrote that States
should not have full discretion for determining the distribution of
available grant funding unless FEMA establishes and enforces clear,
specific, and objective criteria for rating and prioritizing the grant
applications, and that criteria is available to potential grant
applicants prior to development of their mitigation plans. In addition,
the commenter wrote that eligible jurisdictions turned down for a grant
by their State should be given the opportunity to appeal the decision
to FEMA and/or submit the application directly to FEMA for
consideration.
FEMA's Response: FMA is a State-administered program, meaning that
States work with local communities to identify, select, and forward to
FEMA projects and planning activities that will reduce the risk of
flood damage to NFIP-insured structures based on detailed annual
program guidance provided at http://www.fema.gov/government/grant/fma/index.shtm.
Further, FEMA regional offices oversee the adherence of
States to the annual program guidance when awarding grants to
communities. FEMA does not use an appeals process for local communities
whose FMA subgrant applications are declined by their State. However,
if a State requests that FEMA review an FMA grant determination, FEMA
would re-examine prior planning grant decisions made by the State.
Furthermore, local communities are able to resubmit, the next fiscal
year, subgrant applications that have been declined.
Cost-effective mitigation measures. One commenter wrote that the
interim rule limited certain structure retrofitting that can be
employed as part of cost-effective mitigation measures. For example,
examinations of flood insurance claims histories for repetitive loss
structures may suggest minimal retrofitting efforts such as elevating
the electrical panel may remove repetitive loss and be more cost
effective and practical than elevating the entire structure.
FEMA's Response: FMA project grants may only be used to fund cost-
effective mitigation measures for individual properties, such as
acquisition or elevation, which provide a 100-year level of flood
protection. FEMA has determined that mitigation actions not resulting
in a 100-year level of flood protection for individual properties are
inconsistent with the requirements of the FEMA floodplain management
regulations provided in Sec. 60.3. Therefore, elevation and dry-
floodproofing activities, such as minimal retrofits for repetitive loss
properties recommended by the commenter, are not considered eligible
for FMA project funds if they do not result in a 100-year flood
protection for residential and non-residential properties.
Premiums. One commenter asked whether insurance premiums would be
reimbursable under the FMA program, as they are under the Hazard
Mitigation Grant Program. The commenter stated that reimbursed
insurance premiums were perceived as an incentive for maintaining
insurance during the acquisition program after the 1993 floods in order
to get property owners to accept FEMA buyouts.
FEMA's Response: Insurance premiums are not reimbursable under the
FMA program. For acquisition projects, HMGP provides States with the
opportunity to allow local communities to reimburse flood insurance
premium amounts to property owners. However, States and local
communities are not allowed to reimburse flood insurance premiums
amounts to participants in FMA acquisition projects because the flood
insurance policy is a requirement for program participation.
[[Page 61550]]
Tracking repetitive loss structures. One commenter wrote that the
Federal Insurance Administration should establish a method to track
acquisition of repetitive loss structures so that FEMA can adjust
allocation formulas to reflect the actual number of structures at risk.
The commenter wanted to ensure that FEMA is both tracking the number of
new repetitive loss properties as well as the number of mitigated
properties, so that target allocation amounts are computed in a fair
manner.
FEMA's Response: Since the inception of the Community Rating System
in 1990, FEMA has been tracking both new and mitigated repetitive loss
properties present in NFIP participating communities. New repetitive
loss properties are added through the FEMA insurance databases which
track claims data on all NFIP insured structures. Repetitive loss
properties are mitigated by several means including acquisition,
elevation, floodproofing, and structural flood control projects. FEMA
tracks these mitigated properties through the Bureau and Statistical
Agent (BSA) developed by the NFIP within its data mainframe to capture
and record both the reported mitigation action and the reported funding
sources used to achieve that mitigation action. As of June 30, 2007,
13,477 repetitive loss properties have been identified as mitigated in
some manner by the use of local, State, and Federal funds. This number
includes 1,372 mitigated properties which were partially or completely
demolished by fire, wind, flood, or other natural disasters for which
FEMA or another local, State, or Federal agency provided funds in order
to complete the removal of the original structure. FEMA tracks
mitigated and demolished repetitive loss properties in order to ensure
an accurate count of the remaining repetitive loss properties in need
of mitigation. Previously mitigated structures are not counted when
determining the need for future mitigation activities. FEMA uses the
most current data available on unmitigated repetitive loss structures
in order to determine FMA target allocations each fiscal year for
States and territories.
III. Regulatory Requirements
A. Executive Order 12866, Regulatory Planning and Review
FEMA has prepared and reviewed this rule under the provisions of
Executive Order 12866, Regulatory Planning and Review. OMB has
determined that this rule is not a significant regulatory action. OMB
has not reviewed this rule. Under Executive Order 12866, a significant
regulatory action is subject to the Office of Management and Budget
(OMB) review and the requirements of the Executive Order. The Executive
Order defines ``significant regulatory action'' as one that is likely
to result in a rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities;
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
The interim rule published on March 20, 1997 at 62 FR 13346
established the regulations that this document makes final. FEMA
calculates the annual economic impact of the interim rule to be
approximately $40,000,000. As this final rule makes no significant
change to the interim rule, FEMA is adopting the $40,000,000 annual
economic impact estimate of the interim rule as the annual economic
impact of this final rule. The following paragraphs provide a more
detailed explanation of the economic impact of the rulemaking.
This rulemaking establishes the FMA grant system. States receive
one FMA grant award each fiscal year that includes three types of
subgrants: Project, Planning, and Technical Assistance subgrants. FMA
Project Grants are available to States, and NFIP-participating
communities and Indian tribal governments, to implement measures to
reduce flood losses. Up to 10 percent of the Project Grant may be given
to States as a Technical Assistance Grant. These funds may be used to
help administer the program. FMA Planning Grants are available to
States, and NFIP-participating communities and Indian tribal
governments, to prepare Flood Mitigation Plans.
The development of community flood mitigation plans is required as
a condition of receiving FMA project grants under Section 553 of the
National Flood Insurance Reform Act of 1994, Title V, (Pub. L. 103-
325). Section 553 mandates that FEMA approve plans before awarding any
project grants to a community or State applicant. The purpose of the
planning requirement is to encourage communities and States to evaluate
the flood hazards in their jurisdiction(s) and devise a feasible
mitigation strategy to reduce the impacts of the hazard. As communities
implement these strategies, fewer flood losses to insured structures
will occur, resulting in reduced costs to the National Flood Insurance
Fund. There is no renewal requirement with respect to FMA plans, and
only communities are required to have approved FMA plans. There is no
such requirement for States.
There are 660 communities with approved plans. There were
approximately 60 approved per year from 1997-2005, with an annual
increase to 120 in 2006 after Hurricanes Katrina and Rita. For the
purpose of this analysis, FEMA is estimating that there will be 120
local plans that are developed and reviewed for approval each year.
FEMA estimates that it takes an average of 2,080 hours per local plan
to develop, resulting in 249,600 hours of work. The hours of work is
calculated as follows: 120 x 2080. In addition, all States must review
the local plans submitted. Assuming 120 local plans are submitted
annually and it takes 8 hours to review each plan, the total annual
burden for both States, local, and tribal governments would be 250,560
hours. Total annual burden is calculated as follows: ((120 x 8) +
249,600). Using wage rates from the May 2004, U.S. Department of Labor,
Bureau of Labor Statistics (BLS), Standard Occupation Classification
(SOC) System, the median hourly wage for urban and regional planners
(SOC Code Number 19-3051) is $26.31 per hour. Adding 30 percent to the
BLS figure to account for benefits, FEMA has calculated the burden
using a wage rate of $34.20 per hour. Therefore, the total cost to
respondents to collect the information required in flood mitigation
plans in this rule is $8,569,152 annually. The total cost to
respondents is calculated as follows: (250,560 x $34.20).
The next cost implication of this rule is on the submission of FMA
grant applications. There are over 18,000 communities participating the
NFIP, however, the limited funding of the program will not permit
approval of a large number of applicants. The number of respondents
used to calculate the burden hours was, therefore, estimated to be 56
States and Territories x 4 subgrants per State = 224 + 56 States to
review, coordinate and forward grant applications to FEMA for approval
= 280 total respondents. Using wage rates from the May 2004, BLS SOC
System, the median hourly wage for urban and regional planners (SOC
Code Number 19-3051) is $26.31 per hour. Adding 30 percent to the BLS
figure to account for
[[Page 61551]]
benefits, FEMA has calculated the burden using a wage rate of $34.20
per hour. Using the Paperwork Reduction Act calculations approved by
OMB for ``FEMA Emergency Preparedness and Response Directorate Grants
Administration Forms'' (OMB 1660-0025) and ``Flood Mitigation
Assistance (eGrants) and Grant Supplemental Information'' (OMB 1660-
0072), the burden hours for the collection of information for FMA
grants with supplemental information are estimated at 6,642 hours.
Therefore, the total cost to respondents to apply for Flood Mitigation
Assistance is $227,156 annually (6,642 x $34.20).
The total Federal appropriations available for the FMA program,
which establishes the annual award amounts, began at $12,600,000 in FY
1997/1998 and has slowly risen to $31,000,000 for FY 2007/2008. As the
March 20, 1997 interim rule established the FMA program, FEMA is
counting the $31,000,000 awarded as an economic impact of this rule, as
it represents a ``transfer'' from the Federal government. Therefore,
the annual economic impact of this regulation, including the cost to
prepare local plans, apply for grants, and the actual grant funds
awarded is $39,796,308, or approximately $40,000,000. The economic
impact is calculated as follows: ($8,569,152 + $227,156 + $31,000,000).
B. Regulatory Flexibility Act
Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA),
as amended by the Small Business Regulatory Enforcement Fairness Act of
1996 (Pub. L. 104-121, 110 Stat. 857), FEMA is not required to prepare
a final regulatory flexibility analysis for this final rule because the
agency has not issued a notice of proposed rulemaking prior to this
action.
C. National Environmental Policy Act
The National Environmental Policy Act of 1969 (42 U.S.C. 4321 et
seq.) (NEPA) implementing regulations governing FEMA activities at 44
CFR 10.8(d)(2)(ii) categorically exclude the preparation, revision, and
adoption of regulations from the preparation of an environmental
assessment or environmental impact statement, where the rule relates to
actions that qualify for categorical exclusions. Actions to be
implemented under program regulations revised or adopted by this
rulemaking include structural mitigation measures. These activities are
categorically excluded under 44 CFR 10.8(d)(2)(xv) and (xvi). Thus, the
preparation, revision, and adoption of regulations related to these
actions are also categorically excluded.
D. Executive Order 12898, Environmental Justice
Under Executive Order 12898, ``Federal Actions to Address
Environmental Justice in Minority Populations and Low-Income
Populations'' (59 FR 7629, published February 16, 1994), FEMA
incorporates environmental justice into its policies and programs. The
Executive Order requires each Federal agency to conduct its programs,
policies, and activities that substantially affect human health or the
environment in a manner that ensures that those programs, policies, and
activities do not have the effect of excluding persons from
participation in programs, denying persons the benefits of programs, or
subjecting persons to discrimination because of race, color, or
national origin.
FEMA believes that no action under this rule will have a
disproportionately high or adverse effect on human health or the
environment. This rule is intended to provide grant funding to States
and local communities to assist them with efforts to mitigate against
flooding. This rulemaking is intended to assist States and local
communities in reducing the adverse affects on human health or the
environment from flooding. Accordingly, the requirements of Executive
Order 12898 do not apply to this rule.
E. Congressional Review of Agency Rulemaking
FEMA has sent this final rule to the Congress and to the Government
Accountability Office under the Congressional Review of Agency
Rulemaking Act, (``Congressional Review Act,'') Public Law 104-121.
This rule is not a ``major rule'' within the meaning of the
Congressional Review Act. This rule will not result in a major increase
in costs or prices for consumers, individual industries, Federal,
State, or local government agencies, or geographic regions. It will not
have ``significant adverse effects'' on competition, employment,
investment, productivity, innovation, or on the ability of United
States-based enterprises to compete with foreign-based enterprises. The
rule is not an unfunded Federal mandate within the meaning of the
Unfunded Mandates Reform Act of 1995, Public Law 104-4, and any
enforceable duties that FEMA imposes are a condition of Federal
assistance or a duty arising from participation in a voluntary Federal
program.
F. Unfunded Mandates
Title II of the Unfunded Mandates Reform Act of 1995, enacted as
Public Law 104-4 on March 22, 1995, requires each Federal agency, to
the extent permitted by law, to prepare a written assessment of the
effects of any Federal mandate in a proposed or final agency rule that
may result in the expenditure by State, local, and tribal governments,
in the aggregate, or by the private sector, of $100 million or more
(adjusted annually for inflation) in any one year.
The rule is not an unfunded Federal mandate as any enforceable
duties that FEMA imposes are a condition of Federal assistance or a
duty arising from participation in a voluntary Federal program.
G. Executive Order 13132, Federalism
Executive Order 13132, entitled ``Federalism,'' (64 FR 43255,
published August 10, 1999), sets forth principles and criteria that
agencies must adhere to in formulating and implementing policies that
have federalism implications; that is, regulations that have
substantial direct effects on the States, or on the distribution of
power and responsibilities among the various levels of government.
Federal agencies must closely examine the statutory authority
supporting any action that would limit the policymaking discretion of
the States, and to the extent practicable, must consult with State and
local officials before implementing any such action. This rulemaking
creates an entirely voluntary grant program that may be used by States
and local governments to receive Federal grants for mitigation
projects, plans and technical assistance. States and local governments
are not required to seek grant funding and this rulemaking does not
limit the States' policymaking discretion. This final rule involves no
policies that have federalism implications under Executive Order 13132.
H. Paperwork Reduction Act
As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
et seq.), an agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless the
collection of information displays a valid control number. This final
rule does not impose any new reporting or recordkeeping requirements
under the Paperwork Reduction Act. The regulations finalized by this
rule contain requirements for the submission of information contained
in OMB-approved collection titled ``Flood Mitigation Assistance--Flood
Mitigation
[[Page 61552]]
Plan,'' OMB approval number 1660-0075.
I. Executive Order 13175, Consultation and Coordination With Indian
Tribal Governments
FEMA has reviewed this rule under Executive Order 13175,
``Consultation and Coordination with Indian Tribal Governments'' (65 FR
67249, published November 9, 2000). In reviewing the portion of the
rule which streamlines the mitigation planning requirements affecting
Indian tribal governments, FEMA finds that, while it does have ``tribal
implications'' as defined in Executive Order 13175, it will not have a
substantial direct effect on one or more Indian tribes, on the
relationship between the Federal Government and Indian tribes, or on
the distribution of power and responsibilities between the Federal
Government and Indian tribes.
J. Executive Order 12630, Governmental Actions and Interference With
Constitutionally Protected Property Rights
FEMA has reviewed this rule under Executive Order 12630,
``Governmental Actions and Interference with Constitutionally Protected
Property Rights'' (53 FR 8859, published March 18, 1988) as
supplemented by Executive Order 13406, ``Protecting the Property Rights
of the American People'' (71 FR 36973, published June 28, 2006). This
rule will not effect a taking of private property or otherwise have
taking implications under Executive Order 12630.
K. Executive Order 12988, Civil Justice Reform
FEMA has reviewed this rule under Executive Order 12988, ``Civil
Justice Reform'' (61 FR 4729, published February 7, 1996). This rule
meets applicable standards to minimize litigation, eliminate ambiguity,
and reduce burden.
List of Subjects in 44 CFR Part 78
Flood insurance, Grant programs.
0
Accordingly, for the reasons stated in the preamble, the interim rule
amending 44 CFR part 78 which was published at 62 FR 13346 on March 20,
1997, is adopted as final, with the following changes:
PART 78--FLOOD MITIGATION ASSISTANCE
0
1. The authority citation for part 78 is revised to read as follows:
Authority: 6 U.S.C. 101; 42 U.S.C. 4001 et seq.; 42 U.S.C.
4104c, 4104d; Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR,
1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 Comp., p.
376; E.O. 12148, 44 FR 43239, 3 CFR, 1979 Comp., p. 412; E.O. 13286,
68 FR 10619, 3 CFR, 2003 Comp., p. 166.
Sec. 78.1 [Amended]
0
2. In Sec. 78.1, paragraph (b), remove the word ``insurable'' and add,
in its place, the word ``insured''.
Dated: October 24, 2007.
Harvey E. Johnson, Jr.,
Deputy Administrator/Chief Operating Officer, Federal Emergency
Management Agency.
[FR Doc. E7-21263 Filed 10-30-07; 8:45 am]
BILLING CODE 9110-41-P