[Federal Register Volume 59, Number 205 (Tuesday, October 25, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-26159]


[[Page Unknown]]

[Federal Register: October 25, 1994]


=======================================================================
-----------------------------------------------------------------------

FEDERAL EMERGENCY MANAGEMENT AGENCY

44 CFR Parts 59, 60, 64, 65, 70, and 75

RIN 3067-AC17

 

National Flood Insurance Program; Insurance Coverage and Rates, 
Criteria for Land Management, Use, Identification, and Mapping of Flood 
Control Restoration Zones

AGENCY: Federal Insurance Administration, FEMA.

ACTION: Interim final rule.

-----------------------------------------------------------------------

SUMMARY: This interim final rule establishes a new flood insurance rate 
zone for areas designated as flood control restoration zones on 
National Flood Insurance Program maps. It also establishes minimum 
floodplain management requirements and provides regulatory guidance for 
implementing statutory requirements, including procedures to identify 
and map areas as flood control restoration zones.
    The intent of the interim final rule is to permit communities to 
regulate development through minimum floodplain management requirements 
and to use flood insurance rates appropriate to the temporary nature of 
flood hazards during the period when a flood protection system no 
longer provides 100-year flood protection until it is restored.

DATES: This interim final rule is effective October 25, 1994. We invite 
your comments on this interim final rule. Comments must be submitted in 
writing on or before December 9, 1994.

ADDRESSES: Please submit any comments to the Rules Docket Clerk, Office 
of the General Counsel, Federal Emergency Management Agency, 500 C 
Street SW., Washington, DC 20472 (facsimile) 202-646-4536.

FOR FURTHER INFORMATION CONTACT: William R. Locke, Division Director, 
Hazard Identification and Risk Assessment Division, Mitigation 
Directorate, Federal Emergency Management Agency, 500 C Street SW., 
Washington, DC 20472, (202) 646-2717.

SUPPLEMENTARY INFORMATION: On April 1, 1994, FEMA published for comment 
in the Federal Register, 59 FR 15351, a proposed rule. The proposed 
rule contained provisions that would establish a new flood insurance 
rate zone, Zone AR, for areas designated as flood control restoration 
zones on National Flood Insurance Program (NFIP) maps. It would also 
establish minimum floodplain management requirements and would provide 
regulatory guidance for implementing statutory requirements of Sec. 928 
of Public Law 102-550, 42 USC 4014(f), including procedures to identify 
and map areas as flood control restoration zones. Public Law 102-550 
also requires FEMA to promulgate regulations no later than October 28, 
1994.
    Following publication of the proposed rule in the Federal Register, 
copies were mailed to approximately 60 individuals and organizations 
that had previously expressed an interest in the issues that the rule 
addresses. In addition, copies of the proposed rule were sent to 
communities in the Los Angeles and Sacramento areas of California that 
had applied for designation as having flood control restoration zones 
and were sent to the Congressional delegations representing those 
areas.
    During the 45-day public comment period provided for the proposed 
rule, FEMA received a total of twelve letters. All but one of the 
letters contained multiple comments about different issues addressed in 
the proposed rule. Two letters were submitted by members of the U. S. 
House of Representatives who represent areas of Sacramento and Los 
Angeles, California. One of the letters, submitted by three sponsors of 
the legislation, was received after the close of the formal comment 
period, but the issues raised are addressed in the supplementary 
language to these final regulations. Other letters were submitted by 
representatives of seven local government agencies, legal 
representatives of two local property owners associations, and one 
private citizen. In addition, comments received from the U. S. Army 
Corps of Engineers immediately after the close of the formal comment 
period have been considered as well.
    With one exception, the letters received were from those who 
support the concept of the flood control restoration zone. One letter 
urged FEMA to include a requirement in the regulations that prohibits 
the restoration from causing an increase in flood hazards elsewhere. 
All letters were submitted from the Los Angeles and Sacramento, 
California areas, including three Congressional representatives of 
those areas.
    Major issues raised in the public comments included the maximum 
five year restoration period, the provision requiring new construction 
in developed areas to be elevated to three feet above the highest 
adjacent grade, the absence of a ``hold harmless'' provision for delays 
in meeting the restoration schedule, and the definition of 
``developed'' areas. Several comments suggested that the proposed 
regulations pertaining to these provisions be rewritten based on 
concern that the regulations do not comply with Congressional intent as 
reflected in the legislative history.
    Changes have been made since the proposed rules were published in 
April 1994. We decided that because of the changes, and because of the 
technical nature of the issues that these regulations address, the 
public and all affected parties should have another opportunity to 
review and comment on the rule before FEMA publishes a final rule. This 
interim final rule will permit FEMA to meet the statutorily mandated 
date of October 28, 1994 for promulgation of regulations, and it will 
give the public and all affected parties 45 days in which to review and 
comment on the interim final rule. When the 45-day comment period ends, 
FEMA will review and evaluate all written comments received during that 
period, and will publish a final rule in the Federal Register.

Definition of Developed Area

    Several comments were received on the definition of ``developed 
area''. One comment requested clarification on whether open space is to 
be included within the definition of ``developed area''. A related 
comment requested that the definition be expanded to include existing 
publicly-owned property that is critical to the well-being of the 
community. FEMA recognizes that there may be some confusion over 
whether publicly-owned open space is included within the definition of 
``developed area''. These areas are meant to be included in the 
definition of ``developed area'' since they generally support the 
residential, commercial, and industrial well-being of the community. 
The term ``public facilities'' in paragraph (a) encompasses publicly-
owned open space, buildings, and facilities, such as schools, 
hospitals, public parks and open space, and historic sites. FEMA 
believes that it is unnecessary to alter the regulations to clarify 
this point.
    One comment expressed concern that the 75% figure in the definition 
in which an area must be improved with residential, industrial, and 
commercial structures is an arbitrary threshold. FEMA believes that the 
75% figure in paragraph (a)(1) is a reasonable threshold for 
determining a ``developed area'' which is considered or is generally 
recognized as a city, town, or suburban area that consists of 
residential, commercial, and industrial buildings, structures, and 
streetscape and public areas that form a distinct neighborhood or 
section of a city or urban place with the basic urban infrastructure in 
place.
    A related comment concerned areas within a city in which there are 
vacant lots and parcels. Vacant land that contains no structures or 
buildings may be included within a ``developed area'' if the land had 
been previously developed and redevelopment of the site can be 
generally supported by the infrastructure in place. This vacant land is 
considered ``infill''. Land that is in a natural or undisturbed state 
or in agricultural production at the time the designation is adopted is 
not considered ``vacant'' land or an ``infill site'' within a 
``developed area''.
    One comment requested that non-residential subdivisions be given 
the same consideration as residential subdivisions at 44 CFR 59.1(c) of 
the definition which addresses ``vested rights''. The intent of this 
paragraph is to recognize areas as ``developed areas'' where the 
investment in the land and infrastructure is substantial and 
development is underway and infrastructure and structures are being 
built on an ongoing basis. FEMA agrees that the interim final rule 
should recognize and include nonresidential structures and has made 
changes to paragraph (c) to include nonresidential subdivisions. In 
addition, FEMA includes single lot-type developments, such as planned 
unit developments, that are a minimum of 20 contiguous acres.
    Concerns were raised that the proposed rule precludes all 
development in areas outside of the ``developed area''. The suggestion 
was made that the regulations allow nonresidential construction in 
these areas because of the importance of economic development to the 
community and because many local communities currently impose adopted 
floodproofing criteria in order to minimize flood damage. The 
suggestion was also made that the regulations should restrict 
residential construction in areas outside of the ``developed area''.
    The interim final rule does not preclude development in areas 
outside of the ``developed area''. The term, ``developed area'' is a 
means to determine which elevation or floodproofing requirement must be 
applied for new construction within Zone AR. The definition also does 
not classify or establish the location of residential and non-
residential construction or other land uses. The establishment of 
regulations governing the use of land is a decision that resides within 
the state and local land use authority. Nonresidential and residential 
construction can be built in areas outside of the ``developed area'' as 
long as they are built in accordance with the minimum NFIP floodplain 
management criteria and at the elevation established at the site. While 
the NFIP floodplain management criteria require the elevation of 
residential structures, nonresidential construction has the option of 
elevating or floodproofing. Criteria for floodproofing are established 
in the NFIP Regulations that the NFIP community must apply, at a 
minimum, if this option is chosen.
    Another comment asked FEMA how the boundaries of an area will be 
determined to classify it as a ``developed area''. The responsibility 
for designating and adopting an official map or legal description of 
those areas within Zones AR, AR/A1-30, AR/AE, AR/AH, AR/A, or AR/AO 
that are designated ``developed areas'' is established in the 
floodplain management criteria for flood-prone areas at Sec. 60.3(f)(2) 
and the eligibility procedures at Sec. 65.14. In accordance with these 
sections, it is the community's responsibility to submit, as part of 
the community's application for designation of flood control 
restoration zones, its proposed designation of ``developed areas'' in 
accordance with the definition at Sec. 59.1 to FEMA for approval. FEMA 
must determine that the community designations are consistent with the 
definition of ``developed area'' at Sec. 59.1. The community may use 
whatever method it deems appropriate to determine whether a particular 
parcel, tract, or lot, or subdivision is within a ``developed area'' as 
defined in Sec. 59.1 or outside of a ``developed area''. However, FEMA 
encourages communities to coordinate with the FEMA Regional Offices on 
designation of ``developed areas'' before the community adopts an 
official map or legal description of ``developed areas'' within the 
designated flood control restoration zone.

Five Year Maximum Restoration Period

    The majority of the letters received objected to the maximum five 
year restoration period contained in the proposed rule as being 
inadequate. The proposed rule limits the duration of a flood control 
restoration zone designation to a maximum five year period by providing 
that for a community to be eligible for and to maintain such a 
designation, the flood protection system must be fully restored or must 
have achieved ``adequate progress'' as defined in NFIP regulations at 
Section 61.12 within a period not to exceed five years. Comments 
specifically cited experience with the ongoing restoration of flood 
protection systems for both Los Angeles and Sacramento, California, 
which have already been in progress for more than five years without 
achieving ``adequate progress''. Most comments favored a ten-year 
restoration period for AR Zone designation as being a more reasonable 
time frame for restoring a flood protection system, particularly 
because the restoration involves Federal funding. Comments also cited 
that the statute's legislative history supported a ten year period for 
restoration.
    When establishing a time limit for the restoration of 100-year 
protection, FEMA recognizes the need to assess what would be necessary 
to provide a reasonable time frame for restoring a flood protection 
system involving Federal funds or for achieving ``adequate progress'' 
to satisfy the criteria in Sec. 61.12. The U.S. Army Corps of Engineers 
submitted comments on the proposed rule that stated that a five-year 
time frame may not be adequate to ensure that satisfactory progress is 
made on the project restoration to meet the adequate progress 
requirements of Sec. 61.12 of existing NFIP regulations. Those comments 
went on to indicate that ten years may be a more realistic expectation 
for projects that require Congressional authorization and appropriation 
of funds.
    The regulations apply specifically to communities where the 
existing flood protection system is a Federal project and the 
restoration involves Federal funds. Because the U.S. Army Corps of 
Engineers is the Federal agency most frequently involved in design and 
construction of Federal flood protection systems, FEMA believes that it 
is appropriate to give considerable weight to the guidance they have 
provided with respect to establishing a limit on the restoration 
period. Therefore, the interim final rule provides a maximum ten-year 
restoration period, rather than the five years contained in the 
proposed regulations. This revision is cited at the appropriate 
locations in Sec. 65.14 of the interim final rule.
    Comments were received that expressed the opinion that Congress 
intended that the restoration period be negotiated on a community-by-
community basis and implied that Congress did not intend for a specific 
cap or limit to be applied to the length of the restoration period.
    We respond to this latter comment by stating that, according to the 
statute, a community is to be considered to be in the process of 
restoration as long as the restoration of the flood protection system 
``* * * is scheduled to occur within a designated time period * * *''. 
The term, ``designated time period'' indicates the establishment of a 
specific, or definite period of time for restoration in order to confer 
AR Zone eligibility upon a community. Therefore, we believe that the 
proposed rule is consistent with the statute by specifying a maximum 
time frame for restoring the flood protection system that can be 
uniformly applied to eligible communities.
    Within that maximum time frame, the regulations anticipate that the 
community and FEMA will negotiate a specific restoration plan for a 
given flood protection system that will be based on the individual 
requirements for restoring that system. The plan must identify when the 
project will be completed or when the community will submit a request 
for a finding of adequate progress that satisfies the requirements of 
Sec. 61.12. These dates will be dependent upon the project which may 
not require the full ten-year maximum restoration period provided by 
these regulations.

``Hold Harmless'' Provision for Delays in Complying With 
Restoration Schedule

    Several comments objected to the absence of a ``hold harmless'' 
provision in the regulations to address delays in meeting the 
restoration schedule for any reason. It was felt that the lack of such 
a provision essentially holds the community responsible for actions 
that may be beyond its control. For example, the community may not be 
the local project sponsor of the restoration project and, as a result, 
may have limited influence as to whether the project's local and 
federal sponsors meet the restoration schedule agreed upon by the 
community and FEMA as part of the community's application for AR Zone 
designations. In addition, several comments cited that potential delays 
in Congressional authorization and appropriation of funds could affect 
a community's ability to comply with the restoration schedule, as could 
disasters and acts of nature, such as earthquakes or other natural 
hazards. These comments cite the legislative history as supporting the 
position that the regulations provide maximum flexibility for the 
community to meet the restoration schedule.
    In addition, one comment suggested that Sec. 65.14(g) of the 
proposed regulations recognized the potential for such delays in that 
it requires the community and the Federal sponsor to update the 
restoration plan and identify any ``* * * problems that will delay the 
project completion from the restoration plan previously submitted * * 
*''. The provisions in Sec. 64.14(g) provide for relatively minor 
modifications to the scheduled restoration plan, including modifying 
the time frames negotiated under an existing restoration plan. However, 
it does not imply that the maximum restoration period provided for in 
the regulations can be exceeded as a result of any modification.
    It is our position that the regulations should not include ``hold 
harmless'' provisions or provisions to extend, for any reason, the AR 
Zone designation beyond the maximum ten-year restoration period 
specified in the regulations. Central to this position is FEMA's belief 
that the flood control restoration zone is not a long-term or permanent 
flood insurance zone designation. A provision to extend the AR Zone 
designation or the inclusion of a ``hold harmless'' provision would, in 
FEMA's opinion, be contrary to the statute.

Delineation of ``Dual'' Zones

    Two comments expressed the concern that the ``dual'' zone provision 
contained in the proposed regulations is confusing and should be 
eliminated if it does not benefit property owners. This provision is 
specifically intended to benefit current and future owners of 
structures located in areas that, because of flooding from other 
sources that the flood protection system does not contain, will 
continue to be subject to flooding after the flood protection system is 
completely restored. The provision is retained in these regulations.

Limitations on AR Zone Designation

    Comments were raised concerning the requirement in Sec. 64.14(b) of 
the proposed rule, which states that ``a community may have a flood 
control restoration zone designation only once for the purposes of 
restoring a given flood protection system''. The requirement does not 
limit a community's future eligibility for the AR Zone designation in 
the event that a fully restored, certified and accredited flood 
protection system were to be decertified again. The provision prevents 
a community from seeking a second flood control restoration zone 
designation if the initial designation has been removed due to 
noncompliance with the restoration schedule or due to a finding that 
satisfactory progress is not being made to complete the restoration. 
FEMA believes that it is unnecessary to alter the regulations to 
clarify this point.

Application and Submittal Requirements

    Several comments were made pertaining to the application and 
submittal requirements contained in Sec. 65.14(e) of the proposed 
regulations.
    One comment suggested that the regulations be revised to state that 
the local project sponsor, not the community applicant be responsible 
for submitting the documentation requirements at Sec. 65.14(e) (1), 
(3), (5), (6), and (7).
    We believe that it is appropriate that the community be responsible 
for submitting documentation referenced above. In doing so, the 
community does not assume financial or administrative responsibility 
for restoration of the flood protection system. For certain submittal 
requirements, such as the restoration plan referenced at 
Sec. 65.14(e)(7), the community would be expected to work with the 
local and federal project sponsors to complete this requirement. Other 
requirements, such as a statement required of the community to 
accompany the Federal agency certification required at 
Sec. 65.14(e)(3), would be to assure FEMA that the community is aware 
of the certification being made by the Federal agency, but it does not 
imply any specific technical input or expertise on the part of the 
community.
    One comment suggested that the documentation required in 
Sec. 65.14(e) include a statement that the flood protection system 
under restoration will not increase flood hazards in surrounding areas. 
Such a provision relates directly to the design requirements for 
constructing a restoration project that is not within the scope of the 
statute or these regulations. It is appropriate that concerns about 
induced flooding be addressed by the local and Federal sponsors of the 
restoration project. Therefore, such a provision has not been included 
in these regulations.
    One comment objected to the requirement in Sec. 65.14(e)(1) that 
the community submit, as part of its application for designation of AR 
Zones, a statement whether the flood protection system is the subject 
of pending litigation or administrative actions. FEMA believes that the 
information is pertinent to FEMA's determination whether the 
restoration project is viable and likely to be completed in accordance 
with the restoration plan required in Sec. 65.14(e)(7). An affirmative 
response would not necessarily result in FEMA's denial of the 
community's application. It is imperative that FEMA be aware of any and 
all existing and potential obstacles to the timely restoration of a 
flood protection system so that the Director can accurately evaluate a 
community's application for designation of AR Zones.
    Comments were raised regarding the application requirement in 
Sec. 65.14(e)(5) that the community applicant submit a feasibility 
study performed by a Federal agency that deems that the flood 
protection system is restorable. Several comments observed that the 
term ``feasibility study'' as used by the U.S. Army Corps of Engineers 
is a specific document within the framework of the project planning 
process, and depending on the type of restoration project, a 
feasibility study may not always be performed. Other comments were 
concerned about the length of time that may be required to prepare a 
U.S. Army Corps of Engineers feasibility study and the associated delay 
in the community's eligibility for AR Zone designation. At least one 
comment suggested that for projects sponsored by the U.S. Army Corps of 
Engineers, a ``reconnaissance'' level study would provide the 
assurances that FEMA requires by demonstrating a Federal interest in 
the project that would restore a minimum 100-year level protection and 
which would identify a local sponsor for the restoration project.
    The interim final rule has been revised to delete the reference to 
``feasibility study'' at Sec. 65.14(e)(5) and instead to refer to a 
study performed by a federal agency that would demonstrate that there 
is a federal interest in the restoration of the system and that it is 
deemed to be feasible to restore the system to provide at least 100-
year protection.
    One comment suggested that the application requirement to submit a 
feasibility study would delay the community's eligibility for AR Zone 
designation which would be contrary to legislative intent. This comment 
implies that community eligibility for an AR Zone designation should 
follow immediately after the decertification of the existing flood 
protection system.
    The eligibility requirements contained in the statute refer to a 
level of activity that would not likely be in place as soon as the 
system was decertified. Therefore, FEMA anticipates that communities 
would be mapped as special flood hazard areas with flood elevations (AE 
Zones), until such time as the progress on the restoration of the flood 
protection system reached a point that would meet the eligibility 
requirements for AR Zone designation. This process is similar to the 
process used to designate A99 Zones under provisions in the NFIP 
regulations at 44 CFR 61.12.
    Several comments objected to the certification requirement in 
Sec. 65.14(e)(6) that the design and construction of the restoration 
project involve Federal funds in order for the community to be eligible 
for AR Zone designation. One specific comment noted that the statute 
does not specify a Federal flood protection system. As stated in the 
supplementary information of the proposed rule, the existing FEMA 
regulations, 44 CFR 61.12, limit A99 Zone designation to communities 
that have made adequate progress on the construction of a flood 
protection system involving Federal funds. Requiring that the 
restoration project involve Federal funds is consistent with the 
existing regulatory provisions of Sec. 61.12.
    Furthermore, the statute provided for floodplain management 
provisions that permit development in flood control restoration zones 
to take place at elevations below the base flood elevation (BFE) that 
would apply in the absence of a flood protection system. Not only will 
new structures be exposed to increased flood risk until the flood 
protection system is fully restored, but those same new structures can 
be insured at less than actuarial rates. The insurance subsidy 
established in the National Flood Insurance Program (NFIP) was 
originally intended for the benefit of those who built without 
knowledge of the risk. In contrast, the subsidy for AR Zone 
designations is extended to those who are aware, or ought to be aware, 
of the increased risk. This special consideration is granted on the 
specific assumption that the increased risk is temporary and will be 
mitigated in the near term. Therefore, in extending the subsidy in the 
AR Zones, there has to be a high degree of assurance that the 
restoration project will be completed.
    FEMA recognizes that there are local jurisdictions that may have 
the resources to build and to restore flood protection systems without 
Federal financial support. On the other hand, the subsidy and the less 
restrictive flood plain management criteria could reduce a community's 
incentive to press for timely completion of its restoration project. 
FEMA cannot compel the completion of a restoration project. Without 
Federal participation in a restoration project, the Federal government 
cannot insure that the anticipated flood protection will be achieved 
within the time allowed by the rule. FEMA concludes that a lack of 
Federal involvement in the restoration process would introduce too 
great an uncertainty that the restoration projects will be completed in 
a timely manner.
    The public policy concern is that, if restoration of the flood 
protection system is never completed, or is completed only after a 
lengthy delay, the owners and occupants of structures built during the 
restoration period at elevations below the actual 100-year flood level 
will permanently be at a greater risk of flooding than they would 
otherwise have been, and this regulation would have contributed 
directly to that greater risk. This is contrary to the basic purpose of 
the NFIP. (See 42 USC Sec. 4001(c)). Therefore, the interim final rule 
retains the requirement that a Federal agency be involved in the 
funding of the restoration in order to establish an essential assurance 
that the restoration will be completed.
    One comment requested that the regulations at Sec. 65.14(e)(8) 
allow changes to the community's adopted map or legal description that 
designates the ``developed areas'' to accommodate minor errors and 
omissions. FEMA recognizes that errors or omissions may occur in the 
drafting of a map or legal description of the designated ``developed 
areas'' that the community then officially adopts. In such cases, FEMA 
would allow the community to submit a revised map or legal description 
that identifies the error or omission. Communities would be required to 
submit evidence to FEMA that the specific land areas to be designated 
as ``developed areas'' satisfy the requirements of the definition of 
``developed areas'' at the time the initial designation was adopted. 
Communities would not be allowed to modify the map or legal description 
to redesignate ``developed areas'' at their discretion while the flood 
control restoration zone designation remains in effect.
    One comment suggested that the regulations provide for 
reconsideration when the Director determines that a community is 
ineligible for a flood control restoration zone designation under the 
provisions contained in the proposed rule at Sec. 65.14(f). The interim 
final rule provides for processing a community's application according 
to procedures specified in existing NFIP regulations at 44 CFR 65.9. 
FEMA believes that these procedures are adequate. Furthermore, there is 
no prohibition against resubmitting an application for AR Zone 
designation.
    Another comment suggested that the procedures cited in the proposed 
regulations at Sec. 65.14(i) for removing the flood control restoration 
zone designation provide for a prior written notice to the community 
and an opportunity to remedy the situation.
    FEMA agrees that the community should be given prior written notice 
of the Director's determination and an opportunity to submit 
information to support retaining the AR designation. The interim final 
rule at Sec. 65.14(i) was revised accordingly. However, the time frame 
specified in the restoration plan shall not exceed the ten year maximum 
restoration period. In addition, the interim final rule states that the 
revision of the Flood Insurance Rate Map to remove the flood control 
restoration zone designation will be accomplished in accordance with 
the existing regulations at 44 CFR Part 67. Finally, the term 
``procedures'' has been substituted for the term ``criteria'' in the 
description of Sec. 65.14 (h) and (i) since this term better describes 
the content of these sections.

Floodplain Management and Land Use Requirements in a Flood Control 
Restoration Zone

    There were several comments concerning the elevation requirements 
in the proposed rule. One comment suggested that the local community 
should be the responsible entity for determining which structures 
should be elevated and also for determining the level at which these 
structures should be elevated. There were several comments requesting 
that FEMA apply the two-foot elevation that was supported in the 
legislative history instead of the three-foot requirement as 
established in the proposed rule for ``developed areas''. Two comments 
requested that structures be allowed to be constructed at grade in deep 
flood areas because elevating to three feet will not significantly 
reduce flood damages. Concern was also expressed that the elevation 
requirement was unreasonable because of the costs associated with the 
three foot elevation requirement and that this elevation would not 
aesthetically fit in with existing structures not built at this 
elevation.
    Congress, under Section 928 of Public Law 102-550, 42 U.S.C. 
4014(f), directed FEMA to ``develop and promulgate regulations to 
implement this subsection, including minimum floodplain management 
criteria, within 24 months after the date of enactment of this 
subsection''. The law is specific in stipulating that the NFIP minimum 
elevation requirements for new construction in impacted areas subject 
to flood depths less than five feet and for infill, redevelopment and 
rehabilitation, regardless of flood depth, could not exceed three feet.
    FEMA believes the law is clear in establishing the floodplain 
management criteria in a flood control restoration zone. FEMA also 
believes that it is in the best interest of the NFIP to require 
structures to be elevated to the lower of either the AR BFE or the 
three-foot elevation permitted by the statute because of the increased 
flood risk to which properties will be exposed during the restoration 
period. Furthermore, the three-foot elevation of structures would 
afford additional protection from flood events that may exceed the 
capacity of the decertified flood protection system, which at a minimum 
must provide at least a 35-year level of protection in order to be 
eligible for a flood control restoration zone. The floodplain 
management criteria established for a flood control restoration zone 
also recognize that there is a chance that the project will not be 
restored. Consequently, the elevation requirement of three feet limits 
the exposure to the National Flood Insurance Fund if the project is not 
restored.
    The floodplain management criteria established are the minimum 
standards for the adoption of floodplain management regulations within 
those areas designated as a flood control restoration zone (Zone AR, 
AR/A1-30, AR/AE, AR/AH, AR/AO, or AR/A). Any community may exceed the 
minimum standards by adopting more restrictive requirements.
    Those seeking variances would use procedures that communities have 
established to deal with hardship and other unusual conditions. 
Communities administer the variances according to 44 CFR 60.6(a). We 
emphasize that while variances may reduce floodplain management 
requirements, they do not reduce flood insurance rates. By law, flood 
insurance rates must be charged commensurate with the risk to which a 
building is exposed. Any person seeking a variance to reduce floodplain 
management requirements should investigate the impact of the variance 
on the cost of flood insurance.
    Furthermore, the widely accepted protection techniques available 
for new construction of residential structures and non-residential 
structures provide practical and affordable alternatives that can be 
designed to be compatible with existing construction in a flood control 
restoration zone. For non-residential construction, the NFIP provides 
the option of elevation or floodproofing to resist the effects of 
flooding. Rather than specify an elevation or floodproofing method, the 
regulations give the property owner or builder the flexibility to 
choose the most appropriate technique. Similarly, there are several 
common, affordable methods of elevating residential structures, 
including elevation on earth fill, foundation walls, posts, piles, and 
piers. In some cases, it may be advantageous to use a combination of 
elevation methods.
    One comment requested that the regulations clarify the use of the 
term ``highest adjacent grade'' compared to the term ``existing grade'' 
that is used in the statute. The term ``highest adjacent grade'' is 
used in the interim final rule at paragraph 60.3(f)(3)(i). This 
paragraph establishes the elevation that must be used for applying the 
floodplain management requirements in areas within Zone AR designated 
as a ``developed area'' for new construction and in other areas in Zone 
AR where the AR flood depth is five feet or less. In these areas, the 
requirement is to apply the lower of either the AR base flood elevation 
or the elevation that is three feet above highest adjacent grade. FEMA 
used the term ``highest adjacent grade'' since it is already defined in 
the regulations. ``Highest adjacent grade'' in the NFIP regulations is 
defined as ``the highest natural elevation of the ground surface prior 
to construction next to the proposed walls of a structure''. The 
definition in the regulations provides guidance on the reference point 
from which to measure the elevation of three feet when a proposed site 
is sloped. Also, by applying a single reference point, communities can 
consistently apply the elevation requirements to structures. Therefore, 
FEMA does not believe the term ``highest adjacent grade'' is 
inconsistent with the Act.

National Environmental Policy Act

    FEMA has determined, based upon an environmental assessment, that 
this interim final rule will not have a significant impact upon the 
quality of the human environment. As a result, an Environmental Impact 
Statement will not be prepared. A finding of no significant impact is 
included in the formal docket file and is available for public 
inspection and copying at the Rules Docket Clerk, Office of the General 
Counsel, Federal Emergency Management Agency, 500 C Street, SW., 
Washington, DC 20472.

Regulatory Flexibility Act

    The Director certifies that this interim final rule is exempt from 
the requirements of the Regulatory Flexibility Act because the proposed 
flood control restoration zone is required by statute, 42 U.S.C. 
4014(f), and is required to enhance and maintain community eligibility 
in the National Flood Insurance Program during the period needed to 
restore flood protection systems to provide a minimum 100-year level of 
protection required for accreditation on National Flood Insurance 
Program maps. A regulatory flexibility analysis has not been prepared.

Paperwork Reduction Act

    This interim final rule contains collections of information as 
described the Paperwork Reduction Act that are covered by the following 
OMB Control Numbers: 3067-0020; 3067-0022; 3067-0127; and 3067-0147.

Executive Order 12612, Federalism

    This interim final rule involves no policies that have federalism 
implications under Executive Order 12612, Federalism, dated October 26, 
1987.

Executive Order 12778, Civil Justice Reform

    This interim final rule meets the applicable standards of section 
2(b)(2) of Executive Order 12778.

Executive Order 12866, Regulatory Planning and Review

    Promulgation of this interim final rule is required by statute, 42 
U.S.C. 4014(f), which also specifies the regulatory approach taken in 
the proposed rule. To the extent possible under the statutory 
requirements of 42 U.S.C. 4014(f), this proposed rule adheres to the 
principles of regulation as set forth in Executive Order 12866.

List of Subjects in 44 CFR Parts 59, 60, 64, 65, 70, and 75

    Administrative practice and procedure, Flood insurance, Flood 
plains, Reporting and recordkeeping requirements.

    Accordingly, 44 CFR Parts 59, 60, 64, 65, 70, and 75 are amended as 
follows:

PART 59--GENERAL PROVISIONS

    1. The authority citation for Part 59 is revised to read as 
follows:

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329, 43 FR 41943; E.O. 12127, 3 CFR, 
1979 Comp., p. 376.


Sec. 59.1  [Amended]

    2. Section 59.1 is amended to read as follows:
    A. The definition of Area of shallow flooding is revised to read as 
follows:


Sec. 59.1  Definitions.

* * * * *
    Area of shallow flooding means a designated AO, AH, AR/AO, AR/AH, 
or VO zone on a community's Flood Insurance Rate Map (FIRM) with a one 
percent or greater annual chance of flooding to an average depth of one 
to three feet where a clearly defined channel does not exist, where the 
path of flooding is unpredictable, and where velocity flow may be 
evident. Such flooding is characterized by ponding or sheet flow.
* * * * *
    B. The definition of ``Area of special flood hazard'' is revised to 
read as follows:


Sec. 59.1   Definitions.

* * * * *
    Area of special flood hazard is the land in the flood plain within 
a community subject to a one percent or greater chance of flooding in 
any given year. The area may be designated as Zone A on the FHBM. After 
detailed ratemaking has been completed in preparation for publication 
of the flood insurance rate map, Zone A usually is refined into Zones 
A, AO, AH, A1-30, AE, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, 
or V1-30, VE, or V. For purposes of these regulations, the term 
``special flood hazard area (SFHA)'' is synonymous in meaning with the 
phrase ``area of special flood hazard''.
* * * * *
    C. The definition of ``Special hazard area'' is revised to read as 
follows:


Sec. 59.1   Definitions.

* * * * *
    Special hazard area means an area having special flood, mudslide 
(i.e., mudflow), or flood-related erosion hazards, and shown on a Flood 
Hazard Boundary Map or Flood Insurance Rate Map as Zone A, AO, A1-30, 
AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, AH, VO, V1-30, VE, V, 
M, or E.
* * * * *
    D. A new definition, ``developed area,'' is added after 
``Deductible'' and before ``Development'' to read as follows:


Sec. 59.1   Definitions.

* * * * *
    Developed area means an area of a community that is:
    (a) A primarily urbanized, built-up area that is a minimum of 20 
contiguous acres, has basic urban infrastructure, including roads, 
utilities, communications, and public facilities, to sustain 
industrial, residential, and commercial activities, and
    (1) Within which 75 percent or more of the parcels, tracts, or lots 
contain commercial, industrial, or residential structures or uses; or
    (2) Is a single parcel, tract, or lot in which 75 percent of the 
area contains existing commercial or industrial structures or uses; or
    (3) Is a subdivision developed at a density of at least two 
residential structures per acre within which 75 percent or more of the 
lots contain existing residential structures at the time the 
designation is adopted.
    (b) An undeveloped single parcel, tract, or lot of less than 20 
acres that is contiguous on at least three sides to areas meeting the 
criteria of paragraph (a) at the time the designation is adopted.
    (c) A subdivision that is a minimum of 20 contiguous acres that has 
obtained all necessary government approvals, provided that the actual 
``start of construction'' of structures has occurred on at least 10 
percent of the lots or remaining lots of a subdivision or 10 percent of 
the maximum building coverage or remaining building coverage allowed 
for a single lot subdivision at the time the designation is adopted and 
construction of structures is underway. Residential subdivisions must 
meet the density criteria in paragraph (a)(3).
* * * * *
    3. Section 59.24(a) is revised to read as follows:


Sec. 59.24  Suspension of community eligibility.

    (a) A community eligible for the sale of flood insurance shall be 
subject to suspension from the Program for failing to submit copies of 
adequate floodplain management regulations meeting the minimum 
requirements of paragraphs (b), (c), (d), (e) or (f) of Sec. 60.3 or 
paragraph (b) of Sec. 60.4 or Sec. 60.5, within six months from the 
date the Director provides the data upon which the flood plain 
regulations for the applicable paragraph shall be based. Where there 
has not been any submission by the community, the Director shall notify 
the community that 90 days remain in the six month period in order to 
submit adequate flood plain management regulations. Where there has 
been an inadequate submission, the Director shall notify the community 
of the specific deficiencies in its submitted flood plain management 
regulations and inform the community of the amount of time remaining 
within the six month period. If, subsequently, copies of adequate flood 
plain management regulations are not received by the Director, he 
shall, no later than 30 days before the expiration of the original six 
month period, provide written notice to the community and to the state 
and assure publication in the Federal Register under part 64 of this 
subchapter, of the community's loss of eligibility for the sale of 
flood insurance, such suspension to become effective upon the 
expiration of the six month period. Should the community remedy the 
defect and the Director receive copies of adequate flood plain 
management regulations within the notice period, the suspension notice 
shall be rescinded by the Director. If the Director receives notice 
from the State that it has enacted adequate flood plain management 
regulations for the community within the notice period, the suspension 
notice shall be rescinded by the Director. The community's eligibility 
shall remain terminated after suspension until copies of adequate flood 
plain management regulations have been received and approved by the 
Director.
* * * * *

PART 60--CRITERIA FOR LAND MANAGEMENT AND USE

    4. The authority citation for Part 60 is revised to read as 
follows:

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 
376.

    5. Section 60.2(a) is revised to read as follows:


Sec. 60.2  Minimum compliance with flood plain management criteria.

    (a) A flood-prone community applying for flood insurance 
eligibility shall meet the standards of Sec. 60.3(a) in order to become 
eligible if a FHBM has not been issued for the community at the time of 
application. Thereafter, the community will be given a period of six 
months from the date the Director provides the data set forth in 
Sec. 60.3(b), (c), (d), (e) or (f), in which to meet the requirements 
of the applicable paragraph. If a community has received a FHBM, but 
has not yet applied for Program eligibility, the community shall apply 
for eligibility directly under the standards set forth in Sec. 60.3(b). 
Thereafter, the community will be given a period of six months from the 
date the Director provides the data set forth in Sec. 60.3 (c), (d), 
(e) or (f) in which to meet the requirements of the applicable 
paragraph.
* * * * *
    6. Section 60.3(f) is added to read as follows:


Sec. 60.3   Flood plain management criteria for flood-prone areas.

* * * * *
    (f) When the Director has provided a notice of final base flood 
elevations within Zones A1-30 or AE on the community's Flood Insurance 
Rate Map, and, if appropriate, has designated AH zones, AO zones, A99 
zones, and A zones on the community's Flood Insurance Rate Map, and has 
identified flood protection restoration areas by designating Zones AR, 
AR/A1-30, AR/AE, AR/AH, AR/AO, or AR/A, the community shall:
    (1) Meet the requirements of paragraphs (c) (1) through (14) and 
(d) (1) through (4) of this section.
    (2) Adopt the official map or legal description of those areas 
within Zones AR, AR/A1-30, AR/AE, AR/AH, AR/A, or AR/AO that are 
designated developed areas as defined in Sec. 59.1 in accordance with 
the eligibility procedures under Sec. 65.14.
    (3) For all new construction of structures in areas within Zone AR 
that are designated as developed areas and in other areas within Zone 
AR where the AR flood depth is five feet or less:
    (i) Determine the lower of either the AR base flood elevation or 
the elevation that is 3 feet above highest adjacent grade; and
    (ii) Using this elevation, require the standards of paragraphs (c) 
(1) through (14).
    (4) For all new construction of structures in those areas within 
Zone AR that are not designated as developed areas where the AR flood 
depth is greater than 5 feet:
    (i) Determine the AR base flood elevation; and
    (ii) Using that elevation require the standards of paragraphs (c) 
(1) through (14).
    (5) For all new construction of structures in areas within Zone AR/
A1-30, AR/AE, AR/AH, AR/AO, and AR/A:
    (i) Determine the applicable elevation for Zone AR from paragraphs 
(3) and (4);
    (ii) Determine the base flood elevation or flood depth for the 
underlying A1-30, AE, AH, AO and A Zone; and
    (iii) Using the higher elevation from (i) and (ii) require the 
standards of paragraphs (c) (1) through (14).
    (6) For all substantial improvements to existing construction 
within Zones AR/A1-30, AR/AE, AR/AH, AR/AO, and AR/A:
    (i) Determine the A1-30 or AE, AH, AO, or A Zone base flood 
elevation; and
    (ii) Using this elevation apply the requirements of paragraphs 
(c)(1) through (c)(14).
    (7) Notify the permit applicant that the area has been designated 
as an AR, AR/A1-30, AR/AE, AR/AH, AR/AO, or AR/A Zone and whether the 
structure will be elevated or protected to or above the AR base flood 
elevation.

PART 64--COMMUNITIES ELIGIBLE FOR THE SALE OF INSURANCE

    7. The authority citation for Part 64 is revised to read as 
follows:

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 
376.

    8. Section 64.3 is amended by adding an ``AR'' entry in the chart 
in paragraph (a)(1) after the ``AH'' entry and revising paragraph (b) 
to read as follows:


Sec. 64.3  Flood Insurance Maps.

    (a) * * *
    (1) * * * 

----------------------------------------------------------------------------------------------------------------
           Zone symbol                                                                                          
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                                  * * * * * * *                                                 
AR...............................  Area of special flood hazard that results from the decertification of a      
                                    previously accredited flood protection system that is determined to be in   
                                    the process of being restored to provide a 100-year or greater level of     
                                    flood protection.                                                           
                                                                                                                
                                                                                                                
                                                  * * * * * * *                                                 
----------------------------------------------------------------------------------------------------------------

 * * * * *
    (b) Notice of the issuance of new or revised FHBMs or Flood 
Insurance Rate Maps is given in part 65 of this subchapter. The 
mandatory purchase of insurance is required within designated Zones A, 
A1-30, AE, A99, AO, AH, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, V1-30, 
VE, V, VO, M, and E.
* * * * *

PART 65--IDENTIFICATION AND MAPPING OF SPECIAL HAZARD AREAS

    9. The authority citation for Part 65 is revised to read as 
follows:

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 
376.


Sec. 65.14   [Redesignated as Sec. 65.15]

    10. Part 65 is amended by redesignating Sec. 65.14 as Sec. 65.15.
    11. Part 65 is amended by adding a new Sec. 65.14 to read as 
follows:


Sec. 65.14  Remapping of areas for which local flood protection systems 
no longer provide 100-year flood protection.

    (a) General. (1) This section describes the procedures to follow 
and the types of information FEMA requires to designate flood control 
restoration zones. A community may be eligible to apply for this zone 
designation if the Director determines that it is engaged in the 
process of restoring a flood protection system that was:
    (i) Constructed using Federal funds;
    (ii) Recognized as providing 100-year flood protection on the 
community's effective Flood Insurance Rate Map; and
    (iii) Decertified by a Federal agency responsible for flood 
protection design or construction.
    (2) Where the Director determines that a community is in the 
process of restoring its flood protection system to provide 100-year 
minimum flood protection, a Flood Insurance Rate Map will be prepared 
that designates the temporary flood hazard areas as a flood control 
restoration zone (Zone AR). Existing Special Flood Hazard Areas shown 
on the community's effective Flood Insurance Rate Map that are further 
inundated by Zone AR flooding shall be designated as a ``dual'' flood 
insurance rate zone, Zone AR/AE or AR/AH with Zone AR base flood 
elevations, and AE or AH with base flood elevations and Zone AR/AO with 
Zone AR base flood elevations and Zone AO with flood depths, or Zone 
AR/A with Zone AR base flood elevations and Zone A without base flood 
elevations.
    (b) Limitations. A community may have a flood control restoration 
zone designation only once for the purposes of restoring a given flood 
protection system and must complete restoration of the system or meet 
the requirements of 44 CFR 61.12 within a specified period, not to 
exceed ten (10) years from the date of submittal of the community's 
application for designation of a flood control restoration zone. The 
community may not extend this period. The information specified in this 
section must be supplied to FEMA by the community as part of its 
request for designation of a flood control restoration zone.
    (c) Exclusions. The provisions of these regulations do not apply in 
a coastal high hazard area as defined in 44 CFR 59.1, including areas 
that would be subject to coastal high hazards as a result of the 
decertification of a flood protection system shown on the community's 
effective Flood Insurance Rate Map (FIRM) as providing 100-year 
protection.
    (d) Effective date for risk premium rates. The effective date for 
any risk premium rates established for Zone AR shall be the effective 
date of the revised Flood Insurance Rate Map showing AR Zone 
designations.
    (e) Application and submittal requirements for designation of a 
flood control restoration zone. A community must submit a written 
request to the Director, signed by the community's Chief Executive 
Officer, for a flood plain designation as a flood control restoration 
zone. The request must include a legislative action by the community 
requesting the designation. The Director will not initiate any action 
to designate flood control restoration zones without receipt of the 
formal request from the community that complies with all requirements 
of this section. The Director reserves the right to request additional 
information from the community to support or further document the 
community's formal request for designation of a flood control 
restoration zone, if deemed necessary. At a minimum, each request must 
include the following:
    (1) A statement whether, to the best of the knowledge of the 
community's Chief Executive Officer, the flood protection system is 
currently the subject matter of litigation before any Federal, State or 
local court or administrative agency, and if so, the purpose of that 
litigation;
    (2) A statement whether the community has previously requested a 
determination with respect to the same subject matter from the 
Director, and if so, a statement that details the disposition of such 
previous request;
    (3) A statement from the community and certification by a Federal 
agency responsible for flood protection design or construction that the 
existing flood control system shown on the effective Flood Insurance 
Rate Map was built using Federal funds, that it no longer provides 100-
year flood protection, but that it continues to provide at least a 35-
year level of protection;
    (4) A statement identifying the local project sponsor responsible 
for restoration of the flood protection system to the 100-year or 
greater level of flood protection;
    (5) a copy of a study, performed by a Federal agency responsible 
for flood protection design or construction in consultation with the 
local project sponsor, which demonstrates a Federal interest in 
restoration of the system and which deems that the flood protection 
system is restorable to a 100-year or greater level of flood 
protection.
    (6) A joint statement from the Federal agency responsible for flood 
protection design or construction involved in restoration of the flood 
protection system and the local project sponsor certifying that the 
design and construction of the flood control system involves Federal 
funds, and that the restoration of the flood protection system will 
provide 100-year or greater flood protection;
    (7) A restoration plan to return the system to a 100-year or 
greater level of protection. At a minimum, this plan must:
    (i) List all important project elements, such as acquisition of 
permits, approvals, and contracts and construction schedules of planned 
features;
    (ii) Identify anticipated start and completion dates for each 
element, as well as significant milestones and dates;
    (iii) Identify the date on which ``as built'' drawings and 
certification for the completed restoration project will be submitted. 
This date must provide for a restoration period not to exceed, ten (10) 
years from the date of submittal of the community's application for 
designation as a flood control restoration zone, or;
    (iv) Identify the date on which the community will submit a request 
for a finding of adequate progress that meets all requirements of 
Sec. 61.12. This date may not exceed ten (10) years from the date of 
submittal of the community's application for designation as a flood 
control restoration zone;
    (8) An official map of the community or legal description, with 
supporting documentation, that the community will adopt as part of its 
floodplain management measures, which designates developed areas as 
defined in Sec. 59.1 and as further defined in Sec. 60.3(f).
    (f) Review and response by the Director. The review and response by 
the Director shall be in accordance with procedures specified in 
Sec. 65.9.
    (g) Requirements for maintaining designation of a flood control 
restoration zone. During the restoration period, the community and the 
cost-sharing Federal agency must certify annually to the FEMA Regional 
Office having jurisdiction that the restoration will be completed in 
accordance with the restoration plan within the time period specified 
by the plan. In addition, the community and the Federal agency will 
update the restoration plan and will identify any permitting or 
construction problems that will delay the project completion from the 
restoration plan previously submitted to the Director. The FEMA 
Regional Office having jurisdiction will make an annual assessment and 
recommendation to the Director as to the viability of the restoration 
plan and will conduct periodic on-site inspections of the flood 
protection system under restoration.
    (h) Procedures for removing flood control restoration zone 
designation due to adequate progress or complete restoration of the 
flood protection system. At any time during the restoration period, the 
community may provide written evidence of certification from a Federal 
agency having flood protection design or construction responsibility 
that the necessary improvements have been completed and that the system 
has been restored to provide a minimum 100-year level of protection, or 
may submit a request for a finding of adequate progress that meets all 
requirements of section 61.12. If the Director determines that adequate 
progress has been made, FEMA will revise the zone designation from a 
flood control restoration zone designation to Zone A99. After the 
improvements have been completed and certified by a Federal agency as 
providing a minimum 100-year level of protection, FEMA will revise the 
Flood Insurance Rate Map to reflect the completed flood control system.
    (i) Procedures for removing flood control restoration zone 
designation due to non-compliance with the restoration schedule or as a 
result of a finding that satisfactory progress is not being made to 
complete the restoration. At any time during the restoration period, 
should the Director determine that the restoration will not be 
completed in accordance with the time frame specified in the 
restoration plan, or that satisfactory progress is not being made to 
restore the flood protection system to provide complete flood 
protection in accordance with the restoration plan, the Director shall 
notify the community and the responsible Federal agency, in writing, of 
the determination, the reasons for that determination, and that the 
Flood Insurance Rate Map will be revised to remove the flood control 
restoration zone designation. Within thirty (30) days of such notice, 
the community may submit written information that provides assurance 
that the restoration will be completed in accordance with the time 
frame specified in the restoration plan, or that satisfactory progress 
is being made to restore complete protection in accordance with the 
restoration plan, or that, with reasonable certainty, the restoration 
will be completed within the maximum restoration period, which may not 
exceed ten (10) years from the date of submittal of the community's 
application for designation of a flood control restoration zone. On the 
basis of this information the Director may suspend the decision to 
revise the Flood Insurance Rate Map to remove the flood control 
restoration zone designation. If the community does not submit any 
information, or if, based on a review of the information submitted, 
there is sufficient cause to find that the restoration will not be 
completed as provided for in the restoration plan, the Director shall 
revise the Flood Insurance Rate Map, in accordance with 44 CFR Part 67, 
and shall remove the flood control restoration zone designations and 
shall redesignate those areas as Zone A1-30, AE, AH, AO, or A.

PART 70--PROCEDURE FOR MAP CORRECTION

    12. The authority citation for Part 70 is revised to read as 
follows:

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 
376.

    13. Section 70.1 is revised to read as follows:


Sec. 70.1  Purpose of part.

    The purpose of this part is to provide an administrative procedure 
whereby the Director will review the scientific or technical 
submissions of an owner or lessee of property who believes his property 
has been inadvertently included in designated A, AO, A1-30, AE, AH, 
A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, VE, and V 
Zones, as a result of the transposition of the curvilinear line to 
either street or to other readily identifiable features. The necessity 
for this part is due in part to the technical difficulty of accurately 
delineating the curvilinear line on either a Flood Hazard Boundary Map 
or Flood Insurance Rate Map. These procedures shall not apply when 
there has been any alteration of topography since the effective date of 
the first National Flood Insurance Program map (i.e., Flood Hazard 
Boundary Map or Flood Insurance Rate Map) showing the property within 
an area of special flood hazard. Appeals in such circumstances are 
subject to the provisions of part 65 of this subchapter.
    14. Section 70.3(a) is revised to read as follows:


Sec. 70.3   Right to submit technical information.

    (a) Any owner or lessee of property (applicant) who believes his 
property has been inadvertently included in a designated A, AO, A1-30, 
AE, AH, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, VE, 
and V Zones on a Flood Hazard Boundary Map or a Flood Insurance Rate 
Map, may submit scientific or technical information to the Director for 
the Director's review.
* * * * *
    15. The heading and paragraphs (a) and (b) of Sec. 70.4 are revised 
to read as follows:


Sec. 70.4  Review by the Director.

* * * * *
    (a) The property is within a designated A, AO, A1-30, AE, AH, A99, 
AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, VE, or V Zone, and 
shall set forth the basis of such determination; or
    (b) The property should not be included within a designated A, AO, 
A1-30, AE, AH, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, 
VE, or V Zone and that the Flood Hazard Boundary Map or Flood Insurance 
Rate Map will be modified accordingly; or
* * * * *
    16. Paragraph (c) of section 70.5 is revised to read as follows:


Sec. 70.5   Letter of Map Amendment.

* * * * *
    (c) The identification of the property to be excluded from a 
designated A, AO, A1-30, AE, AH, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/
AH, AR/A, VO, V1-30, VE, or V Zone.

PART 75--EXEMPTION OF STATE-OWNED PROPERTIES UNDER SELF-INSURANCE 
PLAN

    17. The authority citation for Part 75 is revised to read as 
follows:

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 
376.

    18. Section 75.1 is revised to read as follows:


Sec. 75.1   Purpose of part.

    The purpose of this part is to establish standards with respect to 
the Director's determinations that a State's plan of self-insurance is 
adequate and satisfactory for the purposes of exempting such State, 
under the provisions of section 102(c) of the Act, from the requirement 
of purchasing flood insurance coverage for State-owned structures and 
their contents in areas identified by the Director as A, AO, AH, A1-30, 
AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, V1-30, VE, 
and E Zones, in which the sale of insurance has been made available, 
and to establish the procedures by which a State may request exemption 
under section 102(c).

    19. Section 75.10 is revised to read as follows:


Sec. 75.10   Applicability.

    A State shall be exempt from the requirement to purchase flood 
insurance in respect to State-owned structures and, where applicable, 
their contents located or to be located in areas identified by the 
Director as A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, 
AR/A, A99, M, V, VO, V1-30, VE, and E Zones, and in which the sale of 
flood insurance has been made available under the National Flood 
Insurance Act of 1968, as amended, provided that the State has 
established a plan of self-insurance determined by the Director to 
equal or exceed the standards set forth in this subpart.

    20. Paragraphs (a)(4), (a)(5), and (a)(7) of section 75.11 are 
revised to read as follows:


Sec. 75.11   Standards.

    (a) * * *
    (4) Consist of a self-insurance fund, or a commercial policy of 
insurance or reinsurance, for which provision is made in statute or 
regulation and that is funded by periodic premiums or charges allocated 
for state-owned structures and their contents in areas identified by 
the Director as A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/
AH, AR/A, A99, M, V, VO, V1-30, VE, and E Zones. The person or persons 
responsible for such self-insurance fund shall report on its status to 
the chief executive authority of the State, or to the legislature, or 
both, not less frequently than annually. The loss experience shall be 
shown for each calendar or fiscal year from inception to current date 
based upon loss and loss adjustment expense incurred during each 
separate calendar or fiscal year compared to the premiums or charges 
for each of the respective calendar or fiscal years. Such incurred 
losses shall be reported in aggregate by cause of loss under a loss 
coding system adequate, as a minimum, to identify and isolate loss 
caused by flood, mudslide (i.e., mudflow) or flood-related erosion. The 
Director may, subject to the requirements of paragraph (a)(5) of this 
section, accept and approve in lieu of, and as the reasonable 
equivalent of the self-insurance fund, an enforceable commitment of 
funds by the State, the enforceability of which shall be certified to 
by the State's Attorney General, or other principal legal officer. Such 
funds, or enforceable commitment of funds in amounts not less than the 
limits of coverage that would be applicable under Standard Flood 
Insurance Policies, shall be used by the State for the repair or 
restoration of State-owned structures and their contents damaged as a 
result of flood-related losses occurring in areas identified by the 
Director as A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, 
AR/A, A99, M, V, VO, V1-30, VE, and E Zones.
    (5) Provide for the maintaining and updating by a designated State 
official or agency not less frequently than annually of an inventory of 
all State-owned structures and their contents within A, AO, AH, A1-30, 
AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, V1-30, VE, 
and E zones. The inventory shall:
    (i) Include the location of individual structures;
    (ii) Include an estimate of the current replacement costs of such 
structures and their contents, or of their current economic value; and
    (iii) Include an estimate of the anticipated annual loss due to 
flood damage.
* * * * *
    (7) Include, pursuant to Sec. 60.12 of this subchapter, a certified 
copy of the flood plain management regulations setting forth standards 
for State-owned properties within A, AO, AH, A1-30, AE, AR, AR/A1-30, 
AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, V1-30, VE, and E Zones.
* * * * *
    21. The heading and paragraph (c) of section 75.13 are revised to 
read as follows:


Sec. 75.13   Review by the Director.

* * * * *
    (c) Upon determining that the State's plan of self-insurance equals 
or exceeds the standards set forth in Sec. 75.11 of this subpart, the 
Director shall certify that the State is exempt from the requirement 
for the purchase of flood insurance for State-owned structures and 
their contents located or to be located in areas identified by the 
Director as A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, 
AR/A, A99, M, V, VO, V1-30, VE, and E Zones. Such exemption, however, 
is in all cases provisional. The Director shall review the plan for 
continued compliance with the criteria set forth in this part and may 
request updated documentation for the purpose of such review. If the 
plan is found to be inadequate and is not corrected within ninety days 
from the date that such inadequacies were identified, the Director may 
revoke his certification.

    Dated: October 17, 1994.
Harvey G. Ryland,
Deputy Director.
[FR Doc. 94-26159 Filed 10-24-94; 8:45 am]
BILLING CODE 6718-03-P