FEMA 50% rule could affect homeowners
City urges residents to wait before repairing older homes
Trending
City of Cape Coral officials are advising residents that own homes built before 1981 to not make repairs until Dec. 1.
Officials said FEMA’s 50% Rule, a regulation of the National Flood Insurance Program, requires that structures with damage exceeding 50% of their market value be rebuilt consistently with the current flood elevation and Florida Building Code.
“Cape Coral’s City Council is expediting the approval of an ordinance that may remove regulations, to make it easier on the homeowner when determining calculations for the 50% rule,” Cape Coral officials stated in a release.
The 50% Rule prohibits improvements to a structure exceeding 50% of its market value unless the entire structure is brought into full compliance with current flood regulations. This may include elevating the structure, using flood resistant materials, and proper flood venting.
Eric Feichthaler, a Cape Coral attorney and former city mayor, said if a project meets the definition of substantial damage, which is defined by each county and city differently, the entire building must be elevated to or above the Base Flood elevation and otherwise made fully flood compliant.
“This can be extremely burdensome to a homeowner as a typical homeowner's policy only covers replacement value, and a typical flood policy limits efforts to raise the property elevation to $30,000.00,” Feichthaler said. “As regulations change from city to city, the method by which the value is calculated can also change. Most cities use the property appraiser's assessed value, which can be below market value, but alternate valuation methods can be used. This rule has particular application to many houses in the Yacht Club area and throughout Southeast Cape Coral.”
He added that it is important that a homeowner speak with counsel to discuss their specific situation and whether or not the 50% rule will apply prior to commencing significant repairs and renovations.
Councilmember Gloria Tate said the city has a 5-year rule that comes into play when calculating structure worth. After discovering what 50% of the home costs (structure-only, does not include pool, lanai, etc.), the monetary value of any improvements made in the last 5 years is deducted from the 50%.
She said City Council is looking to get rid of, or deduct that 5-year rule to help homeowners recoup as much as possible.
The process could take some time, as council needs to present an ordinance in multiple settings.
The larger picture for the entire city Tate and her colleagues are weighing is how a possible change would impact the entire city. The city’s FEMA Community Rating System score could drop if that rule is tweaked.
“It’s not just one aspect,” Tate said.
To top it all off, new FEMA maps are set to arrive Nov. 17 that are expected to have adjustments in floodplain zones, meaning houses would have to be built higher.
“It’s information people are going to need when deciding whether to remodel and how much their flood insurance is going to be,” Tate said.
The city is hosting a Town Hall with subject matter experts from FEMA on Nov. 3 at 6 p.m. in City Council Chambers (1015 Cultural Park Blvd.)
FEMA representatives will be present and answer questions on topics including but not limited to: the 50% Rule, flood insurance, Small Business Administration, and individual assistance. Doors open at 5 p.m. The Town Hall will be aired live on CapeTV and streamed on YouTube and Facebook.
The city is asking homeowners to call 311 before making repairs.
--Connect with this reporter on Twitter: @haddad_cj