Climate Change Is Here and National Flood Insurance Reform Is Overdue, Fugate Says

Former FEMA Administrator Craig Fugate says it’s time look at what the future holds instead of developing mitigation plans from yesterday’s outdated data.

by Jim McKay / January 16, 2019

Former FEMA Administrator Craig Fugate says it’s time to look forward, not backward, when developing emergency management mitigation strategies, and it’s time for major changes to the way flood insurance is issued.

Fugate, chief emergency management officer at One Concern, emerged from his eight years at FEMA with some strong advice for the future. He said climate change and its effects are here, storms are more intense, even record-setting, and going on past data won’t prepare us for the future.

Regarding flood insurance, he said the troubled National Flood Insurance Program (NFIP) won’t be fixed overnight. “But why don’t we stop writing flood insurance for new construction on flood zones?” he offered when Emergency Management sat down with him at One Concern headquarters in Northern California.

“If you want to build in a flood zone, nobody is telling you not to, but you have to get private insurance. You can’t get it from NFIP.”

For the last 20 or 30 years, Fugate said, there has been a huge transfer of flood risk to the taxpayer as FEMA paid for uninsured losses. That has left NFIP some $20 billion in debt after $16 billion of debt was forgiven last year.

There have been ongoing calls to reform the NFIP, but reformation gets kicked down the road for later. “The people who don’t want to hear that are the realtors, developers, and still some of the staff in Congress who think the more policies we can write, the better we can pay off the program,” Fugate said. “[I thought], you’re never going to do that.”

Fugate also advocated for doubling how high homes are being built. Changing to building from one foot above base-flood elevation to two feet above would put properties at a 500-year risk instead of 100-year risk. And why not go to three feet for critical facilities, such as jails or 911 centers? The cost would be incremental but even a modest investment on the front end (mitigation) would yield big savings in disaster recovery costs.

Fugate said that was a plan he had while at FEMA that developed into a floodplain management standard, which got buried by the new administration.

He said streamlining the buyout process is another reform that needs to take place. “From being at FEMA, I can tell you it sucks,” he said. “It takes too long and it’s too complicated. You need to buy them out before they start making repairs. People need certainty. You leave them in limbo for months and they’re going to give up on it even though it’s good for them and good public policy.”

Investing upfront on mitigation is vital but not a popular idea. “People are afraid of it making everything unaffordable,” Fugate said. “I’m like, you just forgave $16 billion in [NFIP debt] and spent more than $160 billion in supplementals last year for disaster response.”

Fugate said there’s no time to waste, climate change is here, and extreme rainfall events and extreme drought are the norm. “We’ve lost time. We’re in a race. Can we adapt faster because the most immediate impacts will not be sea-level rise, it’s going to be extreme-weather events.”

Because of that, looking back at the past for models and data for mitigation is foolish and it’s time to change.
“Almost all of our mitigation strategies are based on looking backward,” he said. “We do cost-benefit analysis looking at 100 years of data, yet if every event is record-setting, it means past data isn’t helping us.”

Just a few years ago, sea-level rise was 50 or so years in the offing. Experts now say it’s 15 or 20 years out. “We’re already seeing this in places like Norfolk [Va.] and Miami Beach, and others are getting nuisance flooding from high tides and such. That’s going to get worse.”

Fugate pointed to the 40 inches of rain that fell in Texas during Hurricane Harvey and the 35 inches of rain that Hurricane Florence dropped on North Carolina as something other than an anomaly. “We’re seeing extreme rainfall events that are all setting records, which tells us that our meteorological data isn’t preparing us for the future,” he said.

“Too often our decisions about where and how we build are so narrowly defined [by] flood maps, which are really insurance rate maps. And with all this it’s becoming imperative: Building the way we’ve always built, we’re going to fail.”