Audit Criticizes FEMA for Poor Management of SRL Properties

FEMA is not adequately managing severe repetitive loss (SRL) properties covered by the National Flood Insurance Program (NFIP) and doesn’t have an effective program to reduce or eliminate damage to SRL properties and the disruption caused by repeated flooding.

Those were the findings of detailed in a report issued last week by the Department of Homeland Security’s Office of the Inspector General following an audit conducted between August 2018 and December 2019.

Findings

As of March 31, 2019, FEMA’s SRL list contained 37,786 properties, of which 27,415 (73 percent) were reportedly not mitigated and 10,371 (27 percent) were reportedly mitigated. To verify the accuracy of the SRL list, the OIG visited 837 properties in four of FEMA’s 10 regions and determined the list contained incorrect information.

Specifically, 140 (17 percent) of the 837 properties visited had been mitigated, but were incorrectly classified as non-mitigated. Of these, 29 were vacant lots and 111 were elevated structures. In one example, FEMA had acquired and demolished an SRL property in 1993 to protect it from future flood losses, but it remained classified as non-mitigated on the SRL list.

As a result, the OIG issued two key findings:

• First, FEMA does not have reliable, accurate information about SRL properties. This deficiency occurred because of ambiguous FEMA forms to request removal of SRL designation, poor organizational structure, and unassigned roles for ensuring data integrity.
• Second, FMA, which aims to mitigate flood damage for NFIP policyholders, provides neither equitable nor timely relief for SRL applicants. OIG attributed this inefficiency to decentralized FMA grant application requirements and inadequate enforcement of grant requirements.

The report did not come as a surprise to ASFPM as we have long been concerned with the slow progress in getting more properties mitigated to increase the accuracy of the SRL data.

Recommendations

The report outlined three recommendations to FEMA:

• Devise a plan to strengthen its management of SRL properties and ensure the accuracy of the SRL list;
• Revise its approach to ensure equitable and timely distribution of mitigation funding; and
• Strengthen its approach for mitigating SRL properties by promoting communities’ use of the Increased Cost of Compliance repetitive loss provision available under NFIP.

FEMA did not dispute the report and stated it agreed with the recommendations.

Download a copy of the report titled FEMA is Not Effectively Administering a Program to Reduce or Eliminate Damage to Severe Repetitive Loss Properties.