[Federal Register Volume 67, Number 218 (Tuesday, November 12, 2002)]
[Notices]
[Pages 68668-68671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-28623]


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

FEDERAL EMERGENCY MANAGEMENT AGENCY


Agency Information Collection Activities: Submission for OMB 
Review; Comment Request

ACTION: Notice and request for comments.

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

[[Page 68669]]

SUMMARY: The Federal Emergency Management Agency has submitted the 
following proposed information collection to the Office of Management 
and Budget for review and clearance in accordance with the requirements 
of the Paperwork Reduction Act of 1995 (44 U.S.C. 3507).
    Title: Inspection of Insured Structures by Communities.
    Type of Information Collection: Revision of a currently approved 
collection.
    OMB Number: 3067-0275.
    Abstract: The purpose of the inspection procedure and need for the 
community inspection report is to:
    (1) To help the communities of Monroe County, City of Marathon, the 
Village of Islamorada, Florida, and any other community in Monroe 
County that incorporates after January 1, 1999, verify and document 
that post-FIRM structures in their communities comply with the 
community's floodplain management ordinance; and
    (2) To ensure that property owners pay flood insurance premiums 
commensurate with their flood risk due to the increased exposure to 
flood damages.
    The final rule (published in the Federal Register on June 27, 2000, 
65 FR 39726) and the interim final rule (published in the Federal 
Register on March 8, 2002, 67 FR 10631) established an inspection 
procedure in Monroe County, City of Marathon, the Village of 
Islamorada, Florida and any other community in Monroe County that 
incorporates after January 1, 1999, that would be built around the 
flood insurance policy renewal process. The requirement that a building 
be inspected by the community, as a condition of renewing the flood 
insurance policy on the building, would only apply to NFIP insured 
buildings in Special Flood Hazard Areas that are identified as possible 
violations by the community in which the property is located. The 
Special Flood Hazard Areas (SFHA) is an area that is based on a flood 
that would have a 1-pecent chance of being equaled or exceeded in any 
given year, referred to as the 100-year flood.
    Policyholders that have a flood insurance policy with a renewal 
effective date on and after the implementation date of the pilot 
inspection procedure would receive, along with their policy renewal 
notice, an endorsement established in appendices (A)(4), (A)(5), and 
(A)(6) of 44 CFR part 61. The endorsement would provide that an 
inspection by the community may be required before a subsequent renewal 
of the flood insurance policy. Policies issued as new policies after 
the effective date for implementing the pilot inspection procedure 
would also contain the endorsement established in appendices (A)(4), 
(A)(5), and (A)(6). The endorsement amended all flood insurance 
policies (pre-FIRM and post-FIRM) on buildings in Monroe County, City 
of Marathon, and the Village of Islamorada, Florida (there are 
approximately 28,771 flood insurance policies in these communities at 
the time of this submission). Pre-FIRM insured buildings are included 
for the endorsement since there may be some policies within this 
category that should be rated post-FIRM because they were misrated or 
substantially improved after the effective date of the community's 
FIRM. A notice describing the purpose of the inspection procedure would 
accompany the new endorsement to the Standard Flood Insurance Policy 
regarding the inspection procedure.
    Monroe County, City of Marathon, and the Village of Islamorada 
would identify possible violations and forward the list to FEMA. There 
are an estimated 2,000-4,000 number of insured buildings within the 
three communities that may be subject to an inspection based on the 
identification as possible violations. This estimate was reported to 
FEMA from the communities. Based on FEMA's review of floodplain 
development in these communities, FEMA is comfortable with this 
estimate. Monroe County, City of Marathon, and the Village of 
Islamorada would identify possible violations through a review of the 
pre-FIRM and post-FIRM flood insurance policies provided by FEMA and 
from a visual street inspection of the building, from tax records, and 
through a review of other documents on file in the community pertaining 
to the property and through other community procedures. For buildings 
identified by Monroe County, City of Marathon, and the Village of 
Islamorada as possible violations, the insurer of the flood insurance 
policy would send a notice to policyholders approximately six months 
before the policy expiration date. This notice would state that the 
policyholder must obtain an inspection from the community and submit 
the results of the property inspection as part of the renewal of the 
flood insurance policy by the end of the renewal grade period (30 days 
after date of the policy expiration). The insurer would send a reminder 
notice to the policyholder with the renewal notice about 45 to 60 days 
before the policy expires.
    The policyholder would be responsible for contacting the community 
to arrange for an inspection. The community would inspect the building 
to determine whether it complies with the community's floodplain 
management ordinance and document its findings in an inspection report. 
The community would provide two copies of the inspection report to the 
policyholder.
    If the policyholder obtained a timely inspection and sent the 
community's inspection report and the renewal premium payment to the 
insurer by the end of the renewal grace period, the insurer would renew 
the flood insurance policy whether or not the building has been 
identified as a violation by the community. The insurer would review 
the insurance policy for rerating upon review of the community 
inspection report. If the building was not properly rated to reflect 
the building's risk of flooding, the policy would be rerated to reflect 
that risk. If the community's inspection found a violation, the 
community would undertake an enforcement action in accordance with its 
floodplain management ordinance.
    If the policyholder did not obtain an inspection and submit an 
inspection report with the renewal premium payment by the end of the 
renewal grace period (30 days after date of expiration), the flood 
insurance policy would not be renewed. The insurer would send a notice 
to the insured that the flood insurance policy expired and cannot be 
re-issued without the community inspection report.
    The communities will not be using a FEMA designed form in 
documenting the inspection of an insured structure. FEMA consulted with 
local officials from the communities participating in the inspection 
procedure on the type of existing building inspection reports they use 
to implement their floodplain management ordinance and we determined 
that the current community inspection documents could be used for 
purposes of implementing the inspection procedure and for purposes of 
determining whether the building's flood insurance policy needs to be 
rerated by insurer.
    The community inspection report is critical to the effective 
implementation of the inspection procedure. Without the inspection 
procedure, the Village of Islamorada, City of Marathon, and Monroe 
County would continue to have limited ability to inspect properties for 
illegal enclosures that violate their floodplain management ordinance 
and as a result, both communities would be unable to undertake 
appropriate actions to remedy the violations. There are several 
potential serious consequences if these structures continue to be in

[[Page 68670]]

violation of the community's floodplain management ordinance.
    Allowing uses other than parking of vehicles, building access, or 
storage in the enclosed area below the Base Flood Elevation (elevation 
of the 100-year flood) significantly increases the flood damage 
potential to the area below the lowest floor of the elevated building. 
Improperly constructed enclosure walls and utilities can tear away and 
damage the upper portions of the elevated building exposing the 
building to greater damage. Improperly constructed enclosures can also 
result in flood forces being transferred to the elevated portion of the 
building with the potential for catastrophic damage. If a flood 
disaster occurs, the impact will go beyond the building itself. If the 
ground level enclosure is finished with living spaces, there is an 
increased risk to lives. Residents who live in these ground level 
enclosures may not be fully aware of the flood risk.
    Furthermore, there is limited coverage in this area for elevated 
post-FIRM buildings, as provided for in the Standard Flood Insurance 
Policy (SFIP) under article 6--Property Not Covered. This provision of 
the SFIP, effective since October 1, 1983, limits coverage for 
enclosures, including personal property contained therein. FEMA does 
not cover such items as finished enclosure walls, floors, ceilings, and 
personal property such as rugs, carpets, and furniture. In 1983, FEMA 
limited the coverage for enclosed areas below elevated buildings due to 
the financial losses experienced in the NFIP when FEMA provided full 
coverage in these areas. Consequently, property owners and residents 
that may live in these lower enclosed areas may have significant 
uninsured losses in the event of a flood for finished items and 
contents below the lowest floor.
    However, in spite of the limited coverage afforded for these 
enclosed areas, they do affect the rating of the policy. Because of the 
increase in flood damage potential to the building resulting from flood 
forces being transferred to the elevated portion of the building, the 
damage potential must be recognized in the rates by adding rate 
loadings based on the size of the enclosure. In addition, the rates 
must also reflect whether the enclosure contains essential building 
elements which are covered, namely, sump pumps, well water tanks and 
pumps, electrical junction and circuit breaker boxes, elevators, 
natural gas tanks, pumps or tanks related to solar energy, cisterns, 
stairways and staircases attached to the building, and foundation 
elements that support the building. The collection of information from 
the policyholder in the inspection procedure will ensure that the 
policyholders of buildings with enclosures are paying premiums 
commensurate with their flood risk.
    Along with significant flood damages to the building and the 
potential for loss of life, the community, the State, and the Federal 
Government will be faced with costly outlays for flood fighting and 
rescue operations, response, and recovery as well as taxpayer funded 
disaster assistance.
    Under the inspection procedure, the policyholder will be required 
to obtain an inspection in order to renew the policy. This will be a 
one-time collection of information during the period of time for which 
the inspection procedure is to be implemented. Since the primary 
purpose of the inspection is to provide communities with a mechanism to 
ensure compliance with the floodplain management ordinance and for FEMA 
to verify flood insurance rates, less frequent collection of the 
information through the inspection report is not possible.
    Affected Public: Individuals or households and business or other 
for-profit.
    Number of Respondents: 1,500.
    Estimated Time per Respondent:

----------------------------------------------------------------------------------------------------------------
                                          Frequency of
   No. of respondents/type of response      response            Burden hours              Total burden hours
----------------------------------------------------------------------------------------------------------------
4,000 policyholders to receive & read a             1   15 minutes (total for both   1000 hours.
 notice that an inspection is required                   notices).
 in order for the flood insurance policy
 to be renewed. These 4,000
 policyholders will also receive a
 reminder notice about 45-60 days before
 the policy expires.
4,000 policyholders contact respective              1   1-2.5 hours*...............  10,000 hours.
 community to arrange for an inspection
 of the property. Local official
 inspects the property with the
 policyholder or his/her designee.
 (Note: in any given year we expect
 several hundred policyholders to
 receive the notice and contact their
 community.) Compliant buildings should
 take less time to inspect compared to
 an insured building that is non-
 compliant.
 
  *FEMA has estimated that the amount of time to contact the community to arrange for the inspection and for the
 policyholder or his/her designee to be available to let the community official into the building to conduct the
                                 inspection will range from 1 hour to 2.5 hours.
 
4,000 policyholders submit a copy of the            1   8 minutes..................  533 hours.
 inspection report with the renewal
 premium payment.
800 estimated no. of respondents that               1   8 minutes..................  107 hours.
 did not obtain an inspection These
 respondents will be sent a notice at
 time of policy expiration that their
 flood insurance policy expired. (FEMA
 estimates that less than 20% of the
 4,000 respondents will not obtain an
 inspection and as a result their flood
 insurance policy will not be renewed.).
----------------------------------------------------------------------------------------------------------------

    *Total number of Burden Hours to implement the inspection procedure 
over a multi-year period: 11,640.
    Annual (one-time) total burden hours for each policyholder is 
approximately: 3 hours.
    Total annual burden for approximately 500-700 inspections per year 
in Monroe County: 2,100 hours.
    Total annual burden for approximately 200-400 inspections per year 
in the Village of Islamorada: 1,200 hours.
    Total annual burden for approximately 200-400 inspections per year 
in City of Marathon: 1,200 hours.
    Estimated Total Annual Burden Hours: 4,500 hours.
    Frequency of Response: One time.
    Comments: Interested persons are invited to submit written comments 
on

[[Page 68671]]

the proposed information collection to the Desk Officer for the Federal 
Emergency Management Agency, Office of Information and Regulatory 
Affairs, Office of Management and Budget, Washington, DC 20503 within 
30 days of the date of this notice.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the information collection should be made to Muriel B. 
Anderson, Chief, Records Management Branch, Information Resources 
Management Division, Information Technology Services Directorate, 
Federal Emergency Management Agency, 500 C Street, SW., Room 316, 
Washington, DC 20472. Facsimile number (202) 646-3347, or email 
address: [email protected].

    Dated: October 21, 2002.
Edward W. Kernan,
Division Director, Information Resources Management Division, 
Information Technology Services Directorate.
[FR Doc. 02-28623 Filed 11-8-02; 8:45 am]
BILLING CODE 6718-01-P