BERLIN — Despite the flood-control benefit of four hydro-power dams on the Androscoggin River, the Federal Emergency Management Agency's new floodplain maps now include even more of the "City That Trees Built," affecting more than nine times as many Berlin properties as before.
Although the new floodplain maps were unveiled in February 2013, questions about them, and their consequences are still a subject of much interest, said Pamela Laflamme, the city's community development director. That interest includes Jennifer Gilbert, floodplain management program coordinator with the New Hampshire Office of Energy and Planning.
The bottom line, Gilbert said, is that the federal Flood Insurance Program, which is administered by FEMA, has taken a huge financial hit, beginning in 2005 with the aftermath of Hurricane Katrina and is about $24 billion in debt.
To ensure the program's sustainability, Congress in 2012 approved legislation that would gradually phase-out some subsidies and bring flood-insurance premiums to true costs. Gilbert said that 214 Granite State communities are part of the FIP, adding that although President Barack Obama on March 21 signed legislation that would delay some of the reforms, they are coming nonetheless.
Established in 1968 when private insurers decided they didn't like the risk-return ratio, FIP lets communities agree to adopt certain floodplain regulations and in turn FEMA provides flood insurance.
When someone wants to buy a property and needs to finance the purchase, the lending institution is required to look at the floodplain maps, she said, and if it's determined that the property is in a floodplain, the lender — not FEMA — then requires the buyer to enter the FIP.
Anyone who can pay cash to buy a property or whose mortgage is already paid off doesn't need to have federal flood insurance, Gilbert said, although there could be difficulties if the property owner ever wants to sell the property.
There are private providers of flood insurance, but they're very few in number — representing about one percent of the total market by Gilbert's estimate — and their rates are typically more expensive than through the 100 companies providing it under the FIP banner.
As of mid-March, there were 9,460 flood-insurance policies in total and the number is likely to increase, said Gilbert, a fact attested to by Laflamme who estimated that where Berlin had a dozen properties in the FEMA floodplains, there are now about eight times as many.
Both she and Gilbert said the changes are making some people hesitant about buying properties in floodplains. Gilbert advised anyone with an existing flood policy to talk to their insurance agent and counseled would-be property buyers to "take a look at the maps just so they know what they're up against."